Company revenue drivers are changing. If you look at the companies building fortunes out there they aren’t running the same models as they used to. Facebook is the largest media in the world and doesn’t generate any content; AirBnB is the largest hotel company and doesn’t own any buildings; Uber is the largest taxi company and doesn’t own any car… There’s been a shift in the cognitive bias of most people, who tend to trust other people’s points of view more than professional content. The value is more and more often coming not from your product but from the community you’re building around it! A great product is not going to succeed in the market out there if you’re not building the right communities. Trip Advisor with 100 users would have no value at all, even though it may be a cool idea.
This “phenomenon whereby a good or service becomes more valuable when more people use it” (Investopedia) is called the network effect. The more people, the more value, basically. It sounds simple and logical, but not that many companies actually enjoy it. Indeed, not just because your product will become valuable with more people using it means that they’re actually going to come. Why would they use it as it’s got no value so far? Hence you need to inspire your first users, make them your advocates, and have them contribute to your content.
A lot of the potential of IoT resides in how well companies will achieve growing up their communities. Open IoT platforms like Hitachi’s Lumada do have a great potential, and it may be a great product per se, but will it accomplish the crucial step of getting people excited to develop around it? If so, just imagine kind of an app store where developers could use not only their skills, but a huge amount of data stored from sensors present in all the IoT objects we have around us to create breakthrough innovations. Based on this centralization of big data Hitachi has already developed predictive crime analytics and is working on making cities more sustainable… If such companies achieve building developer communities around their centralized big data platform, it’s hard to imagine how many disruptive ideas will then flow out of these new resources. Lumada, the next app store with millions of applications… for social innovation?