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PTC’s ‘Things of the Internet’ Strategy
Andrew Borg, Aberdeen Group
JUN 19, 2014 14:41 PM
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Earlier this week, in the opening address of PTCLive 2014, CEO Jim Heppelmann challenged us to think about The Internet of Things (IoT) – a vision for an interconnected world where products are enhanced and transformed by the seamless interconnectivity of devices and sensor-enabled objects. While I am not as dismissive of IoT as my colleague Kevin Prouty, I agree that the concept is certainly not new. Like Kevin, I first heard about IoT in the 90’s (although, we didn’t call it that back then; and come to think about it, I am still waiting for my refrigerator to automatically re-order milk!) In fact, the doom-sayers have been predicting IP Address exhaustion (driven by the connectivity of devices) as far back as the early ’90’s. Yes, we connect things to the internet and have been doing so for a long time (as referenced in the Aberdeen Research report Smart Machines Lead to Smarter Service: Remote Intelligence Signals Profitable Resolution.)

Why are CEO’s all of a sudden excited by IoT?

IoT, and all that it represents, is a grand unifying theme. As companies grow, both organically and through acquisitions, corporate strategies risk looking like congressional districts that have been “gerrymandered” to include the best and most promising products, markets and capabilities. When faced with this situation, a CEO has no choice but to find a grand unifying theme that begins to pull these bits together. An interconnected “IoT” vision is under-pinned by technology and capabilities, which currently exists and is widely used today. These include Mobile, Social, Sensors, Location and Data (discussed extensively in Robert Scoble and Shel Israel’s, The Age of Content). At Aberdeen, we have been researching and publishing on the impact of Social-Mobile-Cloud (SoMoClo™) technologies for several years. No, there is nothing inherently new about IoT, but it a useful strategic unifier for the system and service approach to design.

If it’s not new, why aren’t consumers reaping greater benefits from IoT

Engineers, engineer; marketers, market; and consumers will continue to consume incremental innovations that strike their fancy and solve problems. It’s simple; IoT is not a technology problem, or even a product problem. It’s a business-model problem. In any new paradigm, the old are generally not welcoming of the new. PTC’s challenge will be to convince its user base and partner ecosystem to rapidly adopt these capabilities.

One automotive supplier commented to an Aberdeen analyst, “IoT is interesting, but we aren’t even closed to being organized enough to do anything about it. This is ten-year out kind of stuff.” Another customer, a heavy equipment OEM, illustrates the pragmatism that many users exhibit when attending a user conference: “our more advanced design group has been doing this stuff for a while. I am not sure what PTC brings beyond some software lifecycle tools. It is cool that they have a focus on that part though. I really came here to get an update on CREO.”

Given its expansive nature, it’s not surprising that the IoT vision is compelling to some and confusing to others. PTC’s challenge will be to satisfy the base while earning brand permission to be the leader in IoT enabled product and service lifecycle management.

Implications for PTC’s Customers / Prospects

It is easy to be dismissive about an all-encompassing theme such as IoT.  In Jim’s word’s, IoT is not about the ‘internet’, but rather ‘things’.  As a manufacturer, your job is to design, build, deliver and service ’things’ your customers want to buy. PTC’s job is to help you do that. As your customers want greater control, higher performance and automation, your ‘things’ will increasingly be connected or tied into the internet. We’re not suggesting that you need to blindly embrace and adopt a grand IoT strategy, we’re merely mentioning that the ’Things of the Internet’ is an increasingly prevalent reality for manufactures. With the ThingWorx acquisition in December and the IoT strategy outlined yesterday, PTC has committed to doing the heavy lifting (and shouldering much of the risk) of figuring out what IoT can truly mean for manufacturers

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