In the Age of the Internet of Things (IoT), Don’t Just “Set It and Forget It”
The internet has been embedded into products we wouldn’t have dreamed about five or ten years ago. You know those self-serve drink machines at your local restaurant — the ones that allow you to pick any combination of a special drink from a touch screen?
A tiny module inside tracks and analyzes product amount, flavor combinations, syrup volumes, and other information. That data holds a bounty of consumer insights and is sent to beverage companies for R&D, sales tracking, and on-demand ordering, to name a few.
This type of machine to machine (M2M) technology is a subset of larger trend of the “Internet of Things” (IoT), objects that are connected to the Internet via Wi-Fi, wireless, or hardwire. M2M is typically a device connected to another device via a wireless network. The purpose of M2M is to deliver packets of information back to an application for it to be analyzed and acted upon.
This technology has infinite application in the business sector, but as someone who scours the invoices behind these M2M devices, consider these four issues when you jump into this arena: settings, upgrades, billing, and the telecom landscape.
Avoid the “set it and forget it” mindset
Most M2M devices require you to choose a few default settings to get the device up and running (and to start generating data). But you won’t always know what to measure until you start seeing data flow back in. It can take a few months to identify trends, and by that time your attention may be elsewhere, leaving the device unintentionally spinning in whatever setting you started with.
Often the people who have insight into the reports and analytics, are not the same individuals who review the invoices, which tend to move quickly through the accounting process. That neglect can be costly, especially if you aren’t using the volume of data that you are paying to have measured.
We recently worked with a transportation company that utilized a smart dispatching system across three of the four major wireless carriers. When we reviewed its invoices, we found pricing that was established four years ago, and it was paying for a pool of data that was 200 percent more than it was using. If you’re not using the full capacity of your device, you may be able to negotiate with your carrier.
Don’t pay more than necessary for outdated technology
As more devices are being released, revamped, and updated, you could be paying more than necessary for outdated technology. I worked with a large water company that had a M2M sensor that measured the volume of water flowing past it. Every 15 seconds, the sensor reported the volume to prevent unnecessary flooding or waste of this precious resource.
The company had been using the system for years with one of the top carriers. But since the initial product launch, new water measuring systems had arrived on the market. Carriers had responded by changing their pricing structure for older models. After shopping around, we discovered that, even after purchasing a new component compatible with another provider, the business would have a better product and a ROI of less than 6 months.
Watch for third-party billing
M2M applications can be billed directly from telecom carriers or from a third party vendor reselling the wireless connection. Third party vendors can have a longer contract term (5+ years versus month to month) depending on who you are buying from. We have seen companies locked in to outdated pricing for a longer time period than if they had selected one of the major carriers. In addition to third party and length of contract, ask these questions before you sign with a major carrier or a third party:
- Ask about excluding charges for product or service features that are not important to you
- Ask about the price difference if you lease or buy the equipment
- Ask about whether training is included in the contract
Be sure to read the fine print before signing, and consider getting a second opinion.
A shifting industry on the back end
All of the above M2M issues are symptomatic of a larger trend: a telecom industry in flux. With an endless drip of new products, shifting promotional rates, and mergers in the industry, the only constant in the telecom industry is change. We recommend performing a telecom review every three to five years to keep up.
How we can help
You may not have the time or resources to dig into your invoices and look for inaccuracies or overbilling. We offer a complimentary preliminary assessment. Give us one month of your telecom invoices. We’ll forecast your savings and refunds, give you a clean bill of health, or direct you to a resource who can help.