The claim that connectivity is a commodity has existed in the mobile industry for some time and has recently extended itself to the Internet of Things.

But Vodafone's new IoT chief waves away the opinion as "annoying" and clichéd.

Speaking at Mobile Europe and European Communications' IoT in Telecoms conference, Stefano Gastaut, CEO of Vodafone IoT, says the future is rosier for operators than some are suggesting.

It contrasts with the "dumb pipe" criticism of operators, which places them alongside passive providers of essential commodities such as electricity and water, unable to monetise the innovation taking place on top of their networks by third parties.

In an upbeat assessment of the market, Gastaut tells delegates: “This is a cliché, repeated often enough to become an undisputed truth...I don’t believe connectivity will be a commodity for a long time.”

His view is perhaps unsurprising from an operator which seems by most metrics to be making a success of the IoT.

Gastaut says Vodafone now has 65 million IoT connections, including 14.4 million connected vehicles and five million medical devices, supported by 1,400 professionals. In short, it is a “sizeable business growing very nicely” – as big in revenue terms as the operator's Egyptian business which the exec was previously running. It was worth around €235 million in Q4 2017 and saw growth of 18.8 percent in the year to December.

Recently, the exec says, the discussion has moved away from the traditional top down sales model to customers approaching Vodafone.

“The discussion has changed from why you need to do IoT but to how to do it,” says Gastaut, adding that it has also moved from creating proof-of-concepts to commercial solutions.

Gastaut clearly sees a healthy future for operators here. He is confident that the breadth of the market, spanning a range of different sectors with different connectivity needs, provides a sizeable role for operators in tailoring the quality of service needed for each use case.

For example, Gastaut cites how a retail solution will be different to a robotics solution, a view perhaps self-evident but one that shows how flexible an operator needs to be. “You don’t sell a commodity product but outcomes based on quality of services," he says.

“The point I am making is we are more and more not selling megabytes but a number of things on top of the data. Here I am talking about lifecycle management, device management, security, connectivity analytics – all of those things are sold with the pure connectivity part.”

But he has some words of caution, not least that adding services to connectivity is not easy. He also says that the above will require nothing less than a change of business model.

Gastaut cites Amazon, a Vodafone customer, as “not interested in price per megabyte”.

“And frankly it’s a bit of a suicide to push them into price per megabyte, because then price per megabyte is the same for competitors," he adds.

"Then we are all competing on the same thing.”

Using the Amazon example, Gastaut explains that the online retailer is primarily interested in the delivery of goods.

“If you commit to a certain quality of service in terms of percentage of goods to be delivered on time, they are a lot happier and prepared to pay more.”

Perhaps uncomfortably for operators, this may include committing to outcomes that will fall partially under a partner’s control rather than their own.

While Gastaut says Vodafone’s footprint, scale and integration of connectivity with its own IoT platform are its big selling point over competitors, he believes there is so much demand in the market that there is space for other operators to get involved.

But given it is a “platform game”, providers such as Cisco Jasper are currently seen as bigger rivals than other operators.

Those hoping for a single recommendation from Gastaut, whose talk was entitled “How to Succeed in IoT”, may be disappointed. “There is no one way to succeed,” he says. But while there is no easy answer, there is everything to play for.

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