BOSTON, MA and SAN FRANCISCO, CA, -- Senior executive leaders from leading Global 250 companies across Europe came together on July 11, 2003, in Paris, France, to discuss how to capitalize on the expanding global opportunity arising out of Internet-based device networking and machine-to-machine (M2M) communications.
The executive summit meeting was facilitated by Spinnaker Venture Partners, LLC and Harbor Research, Inc., in an effort to synthesize the perspectives of EU business leaders on the strategies and risks involved in building new revenues from the widespread convergence of digital technologies and communications (including Internet and wireless) into everyday devices.
The leaders agreed that the future of their businesses will be shaped by the enormous opportunity made possible by unlocking the information in billions of intelligent, connected devices.
Air Liquide, which acted as host for the summit, is a global leader in industrial gases, with customers in over 70 countries. The company has been an aggressive early adopter of networked field devices and remote monitoring, and looks forward to evolving its existing initiatives.
"A key strategy for Air Liquide is to expand our revenues by building on our core capability to automatically manage remote production facilities," said Jerome Girard, CEO of the Air Liquide Venture Services Division. He continued, "We are capitalizing on the trends in M2M to build new services offerings for our existing customers in markets such as healthcare and semiconductors, as well as to move Air Liquide into new markets such as remote hydro-plant management."
All summit participants shared Mr. Girard's view, and are taking similar actions within their own businesses.
France Telecom, for example, believes that its role will be to deliver the virtual backbone for these new services on a global scale. Phillipe Eon, Director of Marketing and Development at France Telecom remarked, "Our customers are telling us that we need to take a position at the center of this trend to provide the global infrastructure that allows these devices to communicate in a seamless and ubiquitous manner." To Mr. Eon's point, France Telecom's EQUANT division has recently partnered with Schneider Electric in a joint venture to deliver Senside Remote Monitoring and Diagnostic Service to Schneider's customers.
The participants acknowledged that technological challenges still exist due to the enormous variety of smart, communicating devices, and the continuing need for open standards, especially in communications. Further, privacy and security concerns will pose additional challenges to adoption.
But the summit participants also agreed that the technological challenges are quickly dropping away, thanks to an ever-growing community of start-up ventures, especially in the United States, which is collectively addressing the various aspects of the problem. The greater challenges lie in innovative thinking about business alliances.
"We see as one of our greatest challenges the selection of the right constituents from this community for partnerships," said Laurent Ferenczi, CTO at Air Liquide. "We need to clearly understand how to better apply capital in a shared-risk model that helps us achieve our objectives," he concluded. All summit participants agreed that sharing risks and developing effective alliances and partnerships would be key to moving forward effectively, once the security and privacy issues were satisfactorily addressed.
The leaders also strongly agreed that the services opportunity arising out of M2M would be a key component of their future revenues, and must be addressed with a global strategy.
Spinnaker Ventures Partners and Harbor Research are now developing a paper presenting a more thorough analysis of the conclusions and outcomes of the summit. This document will be publicized and made available as soon as it is complete.
Spinnaker Venture Partners, LLC -- http://www.spinnakervp.com/ -- located in Boston, is a leading venture development firm that provides equity and management expertise with an exclusive focus on building leaders in the emerging "pervasive computing" markets.
Harbor Research, Inc. -- http://harborresearch.com/ -- is a research and consulting organization to focus exclusively on the impact of the Pervasive Internet on global business.