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Future Internet Business Strategies - Digibiz'09


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Future Internet Business Strategies - Digibiz'09

  1. 1. Future Internet Markets and Business Strategies An Analysis and a Proposal Man-Sze Li [email_address]
  2. 2. The Internet of Today Adapted from A Zwegers, 2008 Free email RaaS SaaS Sharing files Social & Professional networks Communication Information Content Resources Search engines Instant messaging Mobile Public Internet Satellite PSTN VPN Cable The Internet of Today Broadcast Other content-related services Business Services Virtual Worlds
  3. 3. All the World is Internetable and Serviceable Network Core Internet of Services Connectability Identifiability Locatability Searchability Embeddability Participatory Triggered by & trigger actions Intelligent? Authoritative? Transformative? Characteristics of Things Traceability Properties of Things Sensors, actuators, microsystems, mechatronic systems, fixed and mobile readers, PDAs and their variations, “blogjects”, smart dust ….
  4. 4. Understanding where we are today Content IT Communications Network / Physical Social Layer Content Layer Logical Layer Physical Layer
  5. 5. Remembrances of Things Past
  6. 6. Terminology and Concepts <ul><li>The “Internet” is …. </li></ul><ul><ul><li>A technical construct </li></ul></ul><ul><ul><li>A business opportunity </li></ul></ul><ul><ul><li>A social machine </li></ul></ul><ul><ul><li>? </li></ul></ul><ul><li>The “Future Internet” is … </li></ul><ul><ul><li>The Future + The Internet? </li></ul></ul><ul><li>Whatever is happening in the world, we can see at least fragments of that on the Internet </li></ul>
  7. 7. The Internet Landscape <ul><li>Supply </li></ul><ul><ul><li>(Commercial) network providers </li></ul></ul><ul><ul><li>ISPs </li></ul></ul><ul><ul><li>Content providers </li></ul></ul><ul><ul><li>Equipment providers </li></ul></ul><ul><ul><li>Service providers </li></ul></ul><ul><li>Demand </li></ul><ul><ul><li>“ Users” </li></ul></ul><ul><ul><ul><li>People in different roles </li></ul></ul></ul><ul><ul><ul><li>Intermediary users – entities to which users belong, communicating devices and things, software-based or software-enabled services </li></ul></ul></ul>
  8. 8. “ Internet Markets” and “Internet-based Markets” Internet Technology Market(s) Markets Facilitated by Internet Technologies A flourishing technology market does not automatically create prosperity in other markets it facilitates, let alone the economy as a whole
  9. 9. Impact on Market Structures and Mechanisms <ul><li>Addition of market channel </li></ul><ul><li>A new kind of intermediary </li></ul><ul><li>A new form of marketplaces > a new type of market </li></ul>Perspective and Arguments Generative vs Tethered Appliances Ecosystems: generic technologies, partnerships, new worlds Services Universality & Utility
  10. 10. Business Strategies <ul><li>Intellectual property </li></ul><ul><ul><li>Patents and trade secrets </li></ul></ul><ul><li>Bundling </li></ul><ul><ul><li>“ A superior offering” </li></ul></ul><ul><li>Standards </li></ul><ul><ul><li>Openness, interoperability and market as arbiter </li></ul></ul><ul><li>Open source </li></ul><ul><ul><li>Collective intelligence, added value, management of development process </li></ul></ul><ul><li>Long tail </li></ul><ul><ul><li>Market niches, smaller customers, customisation, choice </li></ul></ul><ul><li>The power of “Free” </li></ul><ul><ul><li>“ 0.0 business”, race to the bottom? </li></ul></ul>
  11. 11. A Utility-based Approach to Future Internet Markets <ul><li>“ Universal Service” </li></ul><ul><ul><li>Affordability, accessibility, availability and quality </li></ul></ul><ul><ul><li>“ Right” </li></ul></ul><ul><li>Maximisation of utility </li></ul><ul><ul><li>Market efficiency vs Nobody is left behind </li></ul></ul><ul><li>Resources: </li></ul><ul><ul><li>Scarcity vs Abundance </li></ul></ul><ul><ul><li>Substitution, inelastic demand, “natural” monopoly and SMP </li></ul></ul><ul><ul><li>Cost of provision </li></ul></ul><ul><li>Utility services beyond broadband </li></ul>
  12. 12. Interoperability Service Utility - ISU Source: Enterprise Interoperability Research Roadmap <ul><li>Delivery of IT as services </li></ul><ul><li>Interoperability as a </li></ul><ul><ul><li>utility-like capability for enterprises </li></ul></ul><ul><ul><li>a public good </li></ul></ul><ul><li>ISU as a basic infrastructure that supports </li></ul><ul><ul><li>information exchange between knowledge sources, software applications and Web services </li></ul></ul><ul><ul><li>a new generation of self-* services and e-business services </li></ul></ul><ul><ul><li>connection between islands of interoperability </li></ul></ul><ul><ul><li>especially SMEs and start-up companies </li></ul></ul><ul><li>ISU is independent of, rather than an extension to, EI solutions on the market </li></ul>Conceptual View of the ISU
  13. 13. A tentative Roadmap towards ISU (“SaaS-U”) Today’s Models (mostly fixed) Simple Increments (modify CPU/ tiered models) Hybrid (Fixed & Variable Usage) Variable Usage (Metered) Value Driven (based on function commoditisation) SaaS Subscription ISU Marginal cost > 0.0 Value based dynamic pricing Service infrastructure as utility Innovation focused Variable costs Shared resources Service oriented Fixed costs Dedicated resources Product oriented IT Plug IT Switch IT Tap
  14. 14. Conclusions <ul><li>Abundance should lead to ever increasing choice </li></ul><ul><li>What is of value changes </li></ul><ul><li>Old economy, new economics </li></ul><ul><li>The future of the Internet technology business is … </li></ul>