As cable and TV operators are losing subscribers to new competition, including streaming platforms like Netflix and Amazon Prime, as well as pay-TV providers like HBO and Showtime, operators must look for fresh revenue streams that will improve dismal churn rates and set a course for improving the bottom line for the coming years.
Many operators are rightly looking at the internet of things as the much-needed lifeline.
Estimates vary somewhat, but IoT numbers are staggering. Some 34 billion devices will be connected to the internet by 2020, up from 10 billion in 2015. IoT devices will account for 24 billion, while traditional computing devices (for example, smartphones, tablets and smartwatches) will make up the remaining 10 billion.
Advantages for operators
Operators are the primary provider of internet services for consumers. Many operators are also extending these internet services into Wi-Fi support, helping consumers install and maintain their internet connectivity throughout the home. As those consumers increase their adoption of IoT devices, they will become ever more attached and dependent on their internet connections — and by extension, the companies that provide them.
This puts operators in a prime position as the keepers of the keys to connectivity. Even better news? Operators already have a tremendous customer base, along with marketing and billing systems, call centers for support and trucks on the road. Some operators are already deploying security services bundled with other service subscriptions. The set-top box is the gateway for these service offerings, effortlessly connecting numerous home sense-and-control devices in one integrated set of smart home applications.
But there’s much more potential here. Smart home services like remote control doors, thermostats and lighting, all centrally monitored and controlled by the set-top box or gateway, represent enticing opportunities for cable and service operators.
These new, high-value services can provide increased customer loyalty along with additional revenues. By offering a turnkey solution, operators can position themselves as providing relatively inexpensive services — just a few additional dollars on top of the monthly fee already paid by subscribers.
Examples of smart home IoT services
Think of smart home IoT services as a smart home butler that assists residents in living their lives securely, more efficiently and comfortably. More than just a network of connected devices, this is an entire intelligent service that combines information from a diverse variety of sensing and input devices in a house, and enables easy management and control of the home’s systems and appliances.
The first step in creating this interconnected home is the use of various sensors that provide data to the cloud regarding the home’s environment, as well as the whereabouts of the individuals in the household. In addition to the immediate family members, grandparents, visitors and even pets can be included. This data is uploaded to an algorithm in the cloud, stored and analyzed via data analytics to create behavior patterns so the system learns how the residents live — where they normally are during specific times, who is present and when.
If the kids get home from school at 3:00 p.m., and the system senses someone entering the home at 11:00 a.m., the anomaly is recognized and will send an alert to the parents. If the system knows that everyone is out of the home by 8:00 a.m. and doors are left unlocked, it can automatically close and lock them. If the heating system has been left on and the home is empty, the smart home system recognizes the issue and turns it off, improving energy efficiency.
Suppose the water heater in the basement springs a leak. In addition to recognizing the problem and sending an alert to the homeowner, the system can turn off the water flow, limiting the damage and the expense of wasting water and energy. The list of potential services goes on and on.
Nothing comes for free
To capitalize on their advantages, operators must invest in their wireless networks to keep pace with the increased data usage and transmission from connected devices. They must also learn how to deal with data and understand data analytics. Finally, operators must retrain installation and support crews to not only place set-top boxes, but convert consumers’ homes into smart homes.
Setting the course for long-term success
In short, IoT represents tremendous opportunities for operators. It enables them to retain more current subscribers, attract new subscribers and provide new services.
There are also less tangible benefits. By digging into IoT services, operators will increase their customer knowledge, leading to ideas for new services. Operators will be known as innovators, leaders and early adopters, which will increase loyalty and set the stage for longer-term success.
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