I²M²—The Future of Industrial Internet Monetization
The following list gives a short introduction
to several Monetization Methods; one of
these will be the central focus of the
subsequent sections of this article:
Upfront Monetization: This is the
traditional monetization method and
easily explained: The System Builder
(Figure 5) buys all the components
and pays the component
manufacturers at time of delivery, at
the latest. For the design and
installation of the system, a surcharge
is added to the sum of payments of all
components; the result is the final
system price which is paid by the
Operational User by the time the
system is ready to operate. Banks are
typically involved in the process to
provide short-term and long-term
loans.
Dynamic Monetization: This is a new
model, today only used in the cloud or
by some IT computer software. In
principle, the Operational User pays
the System and Component Builders
partially upfront and the balance
during the operation of the system.
This Method was introduced at the
beginning of this article and will be
explained in detail in the subsequent
sections.
Independent Analytic Monetization:
The System Builder or a third-party
company collects operational data
from the running IIoT system, analyzes
it and sells it as anonymous analytic
data to competitors of the System
Builder who receives a share of this
revenue. Such data can be used to
optimize the efficiency of comparable
industrial systems (benchmarking) in
exchange for lower operation cost for
the User by providing the data.
Data Aggregation Monetization:
Similar to Independent Analytic
Monetization, but the analytic does
not start until the system reaches the
sunset at the end of life. Such data can
be used to optimize the redesign of
future similar systems of the System
User and competitors; the User again
gets a share of the revenue.
Having several methods available during the
design of a specific IIoT system provides
great flexibility for the participants and
actors shown in Figure 5: Most likely in the
future, a monetization or payment plan for a
specific IIoT System will consist of a
combination of several Monetization
Methods.
D YNAMIC M ONETIZATION M ETHOD
The rest of this article takes a deeper look at
the structure, opportunities and challenges
of the Dynamic Monetization Method. At the
beginning of this article the overall business
advantages of this Monetization Model were
explained. Now let’s see how such a method
could be practically implemented.
First, the overall costs of an industrial system
are broken down into four cost classes:
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Physical Costs: Required to build the
component from raw material or
other components.
Intellectual Costs: Required to design
a component or a system in addition
to the Physical Costs.
March 2018