A new survey report, The Third Industrial Revolution: Intelligent Devices, Software, and the Internet of Things, prepared jointly by Flexera Software and IDC, was published today to provide unique insights into how the third industrial revolution sweeping the global economy is being fueled by device manufacturers - transforming their products, business models and revenue streams with intelligent and Internet-connected technology. Device makers are rolling out software-driven, Internet-connected devices and leveraging software licensing and entitlement management to increase revenues and profits.
The report indicates that reality is catching up to the hype. Device manufacturers are significantly transforming their product and services lines through software-driven intelligent devices, Internet of Things devices and software licensing/entitlement management capabilities that enable monetization of products and services. Among the report's findings:
- The number of internet of things makers will more than double within two years
- Software-enabled intelligent devices continue strong growth
- New product/services categories are being created
- Software licensing/entitlement management is key to monetizing the internet of things
- Proportion of revenues from hardware declining, proportion from services rising
"Hardware device makers are faced with a variety of challenges associated with thin margins, inflexible and costly supply chains, and limited revenue streams," said Amy Konary, Research Vice President - Software Licensing & Provisioning, IDC. "By transforming their business models via software, Internet connectivity and licensing capabilities, device makers can enter new markets, diversify and increase their revenue streams, improve margins, and differentiate from the competition. The survey data indicates that that is exactly what is happening now."