Cisco Live: How the IoT is changing products to services
July 26, 2016
The internet of things is not about the internet, and it is not really about the things. What it is about, according to Rowan Trollope, general manager of Cisco’s IoT group, is the transition from selling just products to selling a service.
Speaking at last week’s Cisco Live conference in Las Vegas, Trollope (pictured above) said that over the years there had been a lot of expectations with the IoT.
“But now,” he said, “vertical by vertical, there are real implementations. One of the biggest transformations in IT today is the IoT. It is at the vanguard. It is the biggest single thing that is driving Cisco today. IT now has a seat at the table with the CEO.”
Looking back, he said the 1960s and 1970s were all about computers making businesses more efficient. Likewise, the 1980s and 1990s were all about the internet.
“Those 40 years were all about changing the way we run businesses,” he said. “But the products we made didn’t really change. Companies still made toasters even though the back end of the business was more efficient. But the next wave is digitalisation. It is moving into the products themselves.”
This is why he thinks IoT is a misleading term. “We are making products smarter,” he said. “It is a transformation from a product to a service. This is where the magic happens.”
Cars, he said, were good examples. “We are going from a car being a mechanical object to the smart connected car,” he said. “Tesla is more a service than a car. Look at how the car has evolved. Part of the car is a service that runs in the cloud.”
However, to do all this, security needed to be tackled, and from the beginning.
“You cannot take a system that was not designed to be secure and make it secure after the fact,” he said. “You have the design the things to be secure and not have security added as an afterthought. As we take the new protocols and low-power connections to the edge of the networks, we are looking at security first. Many of these are mission critical; they are not just nuisances. We are talking about threats to life and limb.”
David Goeckeler, Cisco senior vice president, added: “Security has to be integrated from the start. We can’t build a perimeter and keep everything out. The way we think about security has to fundamentally change.”
Karen Walker (above), senior vice president at Cisco, said technology was helping solve major problems and unlocking possibilities. “Not ten years from now,” she said, “but today, right now. There has never been a better time.”
And Chuck Robbins (above), who became Cisco CEO less than a year ago, added: “Technology can help solve some of the largest problems in the world, but we have to deal with some of the core issues in each country.”
He said the service providers played a vital role in that they added value on top of their connections.
“We have a deep understanding of the service provider environment and of the enterprise environment and we can help bridge between the two,” he said.
That, he said, was why Jasper was an important acquisition for the company.
“There are 31 million devices connected to Jasper,” he said. “We are adding a million a month. There are eight million connected vehicles on the Jasper network. Jasper is an incredibly important part of our IoT strategy going forward.”
Jahangir Mohammed (above), founder of Jasper and now general manager for Cisco’s IoT cloud business, said: “We are not selling a product, we are capturing a relationship. What we are doing at Cisco is sharing the problem. We are not doing this alone, we are doing it with partners.”
However, the hype of the IoT means nothing if it is not helping companies solve problems for their businesses, according to Sandy Hogan, Cisco’s vice president of digital transformation.
“People want to know how to use technology to transform their businesses,” said Hogan (above). “The IoT removes all the boundaries. When things get connected, it changes all the businesses.”
She said that businesses were not buying the IoT, they were buying capabilities, one of which was personalising the customer experience.
“This can affect their survival,” she said. “Another capability is enabling workforce transformation. The IoT transforms everything. It is all about culture and productivity.”
A third capability is optimising business operations. “When you connect machines, the productivity enhancements are amazing,” she said. “By 2020, one million new things will be connected every hour. And the moment these things get connected, it creates new opportunities. The IoT is one of the largest transformations we will see in our time.”