How an Incumbent Telecoms Operator Became an IoT Ecosystem Orchestrator
Christian Marheine, Christian Engel, Andrea Back
This paper presents a case study on how a large, established European telecommunications company, referred to as "TelcoCorp," successfully transitioned into a central role in the Internet of Things (IoT) market. It analyzes the company's journey and strategic decisions in developing its IoT platform and managing a network of partners. The study provides actionable recommendations for other established companies looking to make a similar shift.
Problem
Established companies often struggle to adapt their traditional business models to compete in the fast-growing Internet of Things (IoT) landscape, which is dominated by digital platform models. These incumbents face significant challenges in building the right technology, creating a collaborative ecosystem of partners, and co-creating new value for customers. This study addresses the lack of clear guidance on how such companies can overcome these hurdles to become successful IoT leaders or "orchestrators."
Outcome
- Established firms can successfully enter the IoT market by acting as an 'ecosystem orchestrator' that manages a network of customers and third-party technology providers. - A key strategy is to license an existing IoT platform (a 'white-label' approach) rather than building one from scratch, which shortens time-to-market and reduces upfront investment. - To solve the 'chicken-and-egg' problem of attracting users and developers, incumbents should first leverage their existing customer base to create demand for IoT solutions. - Successfully moving from a simple technology provider to an orchestrator requires actively coordinating projects, co-financing promising use cases, and establishing clear governance rules for partners. - A hybrid growth strategy that balances creating custom, industry-specific solutions with developing scalable, generic components proves most effective for long-term growth.
Host: Welcome to A.I.S. Insights, powered by Living Knowledge. I'm your host, Anna Ivy Summers. Host: In today's fast-paced digital world, many established companies are trying to pivot into new arenas like the Internet of Things, or IoT. But it's a difficult transition. Host: We're going to explore a study that provides a roadmap for success, titled "How an Incumbent Telecoms Operator Became an IoT Ecosystem Orchestrator." It's a fantastic case study on how a large telecoms company successfully moved into the IoT space. Host: And to help us break it down, we have our expert analyst, Alex Ian Sutherland. Welcome, Alex. Expert: Great to be here, Anna. Host: So, Alex, let's start with the big picture. Why is this such a challenge for established companies? They have resources, customers... why do they struggle with something like IoT? Expert: It's a great question. The study points out that the IoT landscape is dominated by a different business model—the digital platform. Think Google or Amazon. Established firms are often built to sell products or services in a linear way, not to manage a complex network of partners and customers. Expert: They face huge hurdles in building the right technology, creating a collaborative ecosystem, and figuring out how to co-create new value. The study even quotes an industry source saying that up to 80% of IoT projects fail, often because companies simply can't connect their devices to get the data they need. Host: Eighty percent is a staggering number. So how did the researchers in this study figure out what makes a company succeed where so many others fail? Expert: They did a deep dive. It's a case study that followed one large European company, which they call "TelcoCorp," over a five-year period, from 2015 to 2020. They interviewed executives, partners, and customers to get a complete picture of the journey. Host: A five-year journey. That must have yielded some incredible insights. What was the most important thing TelcoCorp did right? Expert: The absolute key was a shift in mindset. They decided not to be just another technology provider. Instead, they aimed to become an "ecosystem orchestrator." Host: Orchestrator. That sounds powerful, but what does it actually mean in a business context? Expert: It means they became the central hub that connects everyone. They managed the platform, brought in third-party technology providers, and worked directly with customers to develop solutions. They weren't just selling a product; they were enabling a network of companies to create value together. Host: Okay, so to be an orchestrator, you need a central platform. Did TelcoCorp spend a fortune and years building one from scratch? Expert: That's the second crucial finding. No, they didn't. They licensed an existing IoT platform from a technology provider—what's known as a "white-label" approach. This dramatically shortened their time-to-market and saved them from a massive upfront investment. Host: That’s a very pragmatic move. But a platform is useless without people using it. How did they solve that classic "chicken-and-egg" problem of attracting both users and developers? Expert: They focused on the "chickens" they already had: their massive existing base of business customers. Instead of trying to attract a new audience, they went to their current clients and showed them how IoT could solve their problems—moving them from just buying mobile connectivity to connecting all their industrial assets. This created immediate demand, which then made the platform very attractive to third-party developers and hardware partners. Host: And I imagine once you have customers and partners, the next challenge is getting them to work together effectively. Expert: Exactly. And that’s the final piece of the puzzle. TelcoCorp took an active role. They established clear rules for governance, created new roles like "ecosystem managers" to coordinate projects, and even co-financed promising but risky use cases to get them off the ground. Expert: They also used a hybrid strategy, balancing deep, custom solutions for specific industries with creating scalable, generic components that could be reused across different projects. Host: This is a fantastic roadmap. Alex, let’s get to the bottom line. For the business leaders listening, what are the key takeaways from TelcoCorp's success? Expert: I think there are three main lessons. First, you don't have to build everything yourself. Licensing a white-label platform can be a brilliant strategic shortcut that lets you focus on your customers. Expert: Second, your existing customer base is your most powerful asset. Start there. Solve their problems and use that momentum to build out your ecosystem. Expert: And finally, change your mindset. Don't think like a traditional seller. Think like an orchestrator. Your job is to create the environment, the rules, and the connections that allow your partners and customers to build the future together. Host: So the core message is to leverage your strengths, partner smartly, and shift from being a simple provider to the central orchestrator of your ecosystem. A powerful lesson for any incumbent company looking to innovate. Host: Alex, thank you so much for clarifying this for us. Expert: My pleasure, Anna. Host: And thank you to our audience for tuning in to A.I.S. Insights — powered by Living Knowledge. Join us next time as we decode another key study shaping the future of business and technology.
Internet of Things (IoT), Ecosystem Orchestrator, Telecoms Operator, Industry Incumbents, Platform Strategy, Value Co-creation, Case Study
