A Jasper Wireless White Paper

Six Considerations in Building a Highly Successful Connected Device Business

North America: Jasper Wireless, Inc. 501 Macara Avenue, Suite 202 Sunnyvale, CA 94085 United States of America Tel: +1 408 328 5200 Fax: +1 408 328 5201 Europe: Jasper Wireless, Ltd. 176 St Vincent Street Glasgow G2 5SG United Kingdom Tel: +44 (0) 141 249 6780 Fax: +44 (0) 141 249 6700

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Introduction
There is a revolution going on, and its happening right under our noses. All around the world, connectivity is being embedded into devices we encounter almost daily, fundamentally changing the way we live, work and play. Industrial equipment that once required expensive, on-site servicing can now be monitored, updated, diagnosed, and repaired remotely. Smart grids that monitor energy usage and automatically send alerts when problems arise enable our communities to use energy more efficiently. Connected sensors embedded along gas lines help protect our public safety and the environment by immediately detecting leaks and sending out alerts. Services such as OnStar embed connectivity in our cars, helping to protect us in case of accident and our vehicles against theft, while giving us access to concierge services wherever we are. Our homes are connected now, too. Security systems that used to just sound alarms now automatically control temperature by turning heating and air conditioning systems on and off.

To build a successful connected device business, you must focus on device development, business planning and operations management.

A new class of connected consumer devices is changing the way we access information and entertainment services as well. The popular Kindle and other e-readers make a library of books available through a lightweight tablet. Personal navigation systems now provide real-time traffic updates and enable Google services while were on the road. We even experience the benefits of embedded connectivity as we manage our personal health. Healthcare devices that enable medical staff to monitor patients vital signs remotely in real time make it possible for patients to be discharged earlier and move around freely while recovering at home or in the hospital. In these situations, connected devices dont just enhance quality of life, they can preserve life itself. Given this highly diverse and rapidly growing range of applications, its no wonder manufacturers are eager to join the revolution and introduce their own connected devices. But while the benefits of embedding connectivity are clear, the path to building a successful connected device business is less so. Many manufacturers focus almost exclusively on device development. Obviously that aspect of the business is mission-critical, but so are two other often overlooked elements: business planning and operations management. In order to lay the foundation for a successful connected device business, manufacturers must pay equal attention to device development, business planning and operations management. That means taking a comprehensive approach that addresses these six key considerations: 1. When will the connected device be launched? 2. Where will the connected device be marketed and sold? 3. What is the optimal business model? 4. What will the user experience be like? 5. How will remote devices be supported? 6. How will costs be controlled? This white paper is a guide designed to help educate device manufacturers about the importance and implications of these six considerations in building their connected device businesses.

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1. When will the connected device be launched?

The first thing a manufacturer has to consider is what will it take to get the connected device ready for market? Hardware selection and application development are obvious considerations, but there are many other issues as well.

Device Certifications
In the wireless world, you must ensure that your device will do no harm to the network. This means its compliance with common network standards must be certified. In the US and Canada, the regulating agencies are the FCC and PTCRB. In Mexico, the agency is COFITEL, in Brazil its ANATEL, and in Europe its CE. Completing the certification process with these various agencies can take several months. Network operator certifications are also required. These can take several weeks if your device uses a pre-certified wireless module (or modem), and a year or more if it does not. Operators typically test devices to check their performance on the network. This makes sense: ensuring standards compliance is what makes wireless networks as good as they are.

Performance Assurance
Device certifications are not the only thing you need to plan for; certifications only ensure that the network isnt negatively affected by your device. To launch a connected device successfully, you must also optimize performance to ensure your device behaves as expected under a variety of network conditions. This involves building a comprehensive test suite that allows you simulate all the possible scenarios your device will encounter in the field, not just the typical ones. For example: What happens if the SIM is not allowed on the network because of deactivation or fraudulent activity? What happens when the SIM roams outside of its home network? What happens when the SIM connects to the GSM network, but is unable to make a data connection? What happens if the network signal is weak? What happens if the device is lost or stolen? Performance assurance also means understanding your bandwidth consumption and latency. Are there opportunities for improvement? Usually there are, and identifying them early can reduce operating costs while improving device performance and service delivery. Often performance assurance testing can be completed in as little as four weeks and run in parallel with certification efforts. Although it may seem like an unnecessary extra step, performing this work upfront allows manufacturers to address many connectivity and performance issues before customers experience them in the field. Over the long term, this can significantly reduce customer support costs. Using a global platform such as the one offered by Jasper Wireless can greatly accelerate the device design, certification and performance assurance process. By taking advantage of pre-certified modules, manufacturers can typically certify their devices in less than four weeksat no charge. The Jasper Wireless platform provides the development tools you need to build and execute your test plan.
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To launch a connected device successfully, you must also optimize performance to ensure your device behaves as expected under a variety of network conditions.

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2. Where will the connected device be marketed and sold?

Different markets rely on different network operators, who in turn rely on different network standards. Therefore its important to consider where your product will be launched nowand which markets you plan to enter in the future. For example, the US supports two different types of cellular technology: GSM (used by AT&T and T-Mobile) and CDMA (used by Verizon and Sprint). CDMA is also found in Japan and other parts of Asia. However GSM is a global standard used in every country around the world, so if you plan to market your connected device outside the US or Japan, or if your device must support international roaming, GSM is clearly the better choice. Selecting a CDMA network provider for your initial domestic launch means that you will have to redesign your product and source new hardware when youre ready to expand internationally, adding months or even years to your timeline. Using a global platform such as Jasper Wireless can also accelerate your time to market and reduce development costs by: Serving your business needs across regions and across operators. Enabling pre-built integration with various operator networks. Eliminating the need to replicate effort for each new market you enter. Offering a standard operating environment wherever you deploy your devices. Maintaining a consistent user experience across all markets. Thinking ahead about where you plan to market your connected device lets you make the decisions now that will save you time and money down the road.

3. What is the optimal business model?

Another key consideration is what kind of business model you plan to use for your device. Do you intend to bundle connectivity as part of the cost of the content, like the Kindle? Is connectivity seen purely as a business expense that will not be passed on to your customers? Or do you want to generate revenue using a subscription model?

E-reader
Connectivity charges are built into the price of the content download. No monthly subscription.

Personal Navigation Device

Works out of the box. Initial connectivity period included, then converts to monthly subscription.

Connected digital picture frame

Works out of the box with set number of picture uploads. Can buy additional packages of picture uploads.

Stolen vehicle tracking

Small fee to keep signal alive, larger payment if stolen vehicle must be tracked.

Smart grid meter

Connectivity included in the device, no charge to the consumer.

While the thought of using subscriptions to drive new revenue may be tempting, especially for consumer electronics manufacturers, actually doing so raises a number of issues. How will you promote the subscription service? How many
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subscription choices will you offer? How often will customers move from one subscription offer to another? How will you segment your customers and prospects? Will each one need a unique subscription offer? Are subscriptions optional? Do they expire? How do you promote and manage subscription renewals? In order to deal with these and other business model issues, you need a flexible platform that supports a variety of rate plans so you can compete effectively across all customer segments. With the Jasper Wireless global platform, every option is available to you. You can offer plans based on data usage, time or sessions. You can offer prepaid, post-paid, pooled, non-pooled, regional and global plans. You can also run reports and analytics that help you determine the best rate plan allocation for each individual customer.

4. What will the user experience be like?

Ensuring a positive end-user experience is essential to building a successful connected device business. The more manual steps that are required to register and activate your device, the less satisfying the user experience will be. Minutes can seem like hours when an end user is waiting to access information and services. Even more frustrating from the customer perspective are dead-on-arrival devices. Devices that dont work significantly increase both customer dissatisfaction technical support costs. Although many manufacturers consider DOA devices part of the cost of doing business, each one represents a realand often unnecessaryloss of money. How can manufacturers avoid these losses? By using a platform like Jasper Wireless that supports free device testing so DOA units can be eliminated before they leave the factory floor. The best way to keep your customers happy is to automate as many activation steps as possible without requiring the user to take any action. With the Jasper platform, you can provide a superior, zero-touch, out-of-the-box user experience that differentiates your connected device in the market.

Getting your connected device deployed is only half the battle. How do you support devices once they are in the field?

5. How will remote devices be supported?

Getting your connected device deployed is only half the battle. How do you support devices once they are in the field? Do you bear the expense of sending out a service technician? Do you offer phone support? Are there local personnel with enough training to do remote troubleshooting? Even if you build diagnostics scripts into your connected device, it doesnt mean your troubles are over. What happens if the device cannot connect to the network? Thats one of the most common support issues, and it could be caused by a network connectivity problem, a device software or server software problem, or a hardware malfunction. But without a connection it is impossible to get the diagnostic data you need. Some connected device platforms, such as Jasper Wireless, include network diagnostics that let you quickly determine whether network connectivity is in fact the problem. The ability to rule this factor in or out with in a couple of minutes speeds problem resolution, significantly reducing your customer support costs. Over time you will also need to optimize your operations by running various analytics and reports to determine the health of your deployed devices. For example, you will need to detect whether your devices are starting to consume
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more data, and to be alerted to exception activity. The Jasper Wireless platform puts these and many other software-as-a-service management functions at your disposal, making it easy to stay on top of your global device deployments.

6. How will costs be controlled?

Understanding how much your connected devices will cost your business once they are deployed is the first step toward effective cost control. Typical costs you should consider include: Average usage over time Exceptional usage that could indicate a malfunctioning device or fraudulent activity Unexpected changes in customers usage behavior Logistics and support costs Setting up alerts to notify you of exceptional or unexpected changes can help you identify issues, but you still need to be able to do something about them. With a global platform such as Jasper Wireless, you can take action immediately and prevent minor issues from becoming major expenses. For example, the Jasper Control Center provides a real-time global view of your operations that enables you to:

Change customers rate plans right away Instantly deactivate malfunctioning devices, both individually and en masse Set an overage limit that automatically deactivates the device when reached, preventing excessive usage Receive notification of impending usage overages before they occur

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Summary
Make sure you have a good foundation for a successful connected device business by addressing these six key considerations:

Consideration
1. When will device launch?

Checklist
Device certification Network operator certification Performance assurance testing

2. Where will device be sold?

CDMA or GSM? Integration investment for new markets?

3. What is the optimal business model? 4. What will the user experience be like?

Platform supports various rate plans, your business model? Simplified or automated activation? Low risk of DOA devices?

5. How will remote devices be supported?

Plan for network connectivity issues? Diagnostics and troubleshooting? Analytics for optimizing?

6. How will costs be controlled?

Real-time visibility into operations? Alerts to unusual activity? Ability to instantly deactivate malfunctioning devices and/or automatically deactivate at set limits?

To learn more about how using a global platform can help you build a success connected device business, please contact info@jasperwireless or visit www.jasperwireless.com.