CHARLES: Matt Hatton, welcome to the TechBurst Talks podcast. Matt Hatton: Thank you Charles. Pleasure to be here. CHARLES: It's gonna be a lot of fun today 'cause we get to talk about iot, which is what we always do. And you've been in the iot industry since before it was even called iot. So why don't you do a brief intro to yourself and your company. Transform Insights. Matt Hatton: Yeah, absolutely. Matt Hatton, I'm one of the founding partners here at Transforma Insights. As you mentioned, I've been looking at this IOT space since it was telematics telemetry. Machine to machine was really where we started focusing on it in a heavy way. And that was with a company called Machina Research. I founded that one back in 2011. Sold that one to Gartner in 2016. And then. Stuck around with them for a couple of years and then decided to do the same thing all over again. Another industry this firm focused on predominantly iot. That's mostly what we do a few other areas around the outside AI edge compute a few other interesting technology spaces. And within that, my focus tends to be on all things related [00:01:00] to connectivity. I'm a telecoms guy so I tend to do all the stuff related to mobile network operators, MVNOs hardware makers anything that's sort of middleware platforms related to supporting connectivity. I'm publishing a whole series of reports on technical and commercial best practice. Do we do a whole load of ultra granular iot market forecasts. So yeah that's us at Transforma Insights. CHARLES: I feel for you for coming from the telecom side. I'm an ex telco guy myself and I. I guess it's it's a curse in a way, but you have some good insights because you understand the industry and what it takes to actually deliver solutions. Matt Hatton: Yeah, well, you've gotta, you've gotta be a little bit focused in the, in this area. It's a hugely diverse space and you can't really be an expert on everything, right? So you've gotta kind of pick your battles a little bit. And that was the area that I naturally gravitated towards because obviously I'd focused mostly on the mobility space historically. And then the. Telcos were focusing much more attention on machine to machines as it [00:02:00] was then. And I sort of followed that path and then that gets you into looking at other things related to industrial iot platforms and other technologies particularly some of the idiosyncrasies of the verticals you've gotta look at. And it's it's never dull, shall we say. It's CHARLES: incredibly complex. I mean, let's face it, any iot solution, it covers the whole tech stack. You're gonna have a device that connects over some type of a network through multiple platforms to apps. You gotta secure it, manage it, you know, so it's, you have to cover everything to cover iot. So it keeps our lives a little bit interesting. It Matt Hatton: Certainly does. There's a lot of moving parts in it. Sometimes I'm a bit envious of people whose analyst focuses on something very esoteric and specific and you know, usually CHARLES: quantifiable because there's a definition of what it is. I mean, if you ask 10 people what is iot, you'll get 10 different answers. Matt Hatton: Well, absolutely. It's a whole load of technologies under an overcoat, but that's what keeps it fun. It keeps it interesting. CHARLES: Well, let's start focusing on the communication service providers now, because you just released your latest IOT peer benchmark reports. So you looked at MVNOs [00:03:00] and MNOs around the world on this. So why don't you tell us a little bit about the report and then we'll start digging into some of the findings to see if telcos are gonna finally start making more out of iot Matt Hatton: Yeah, this is a significant piece of work that we do. Feels like it's taken up six months of my life, this is the fifth time we've done this as transforming insights. And then in my previous company, bikini Research, we did much the same sort of thing. So I'm probably on about addition number 10 of this or something much like it. We're doing deep dive research with each of this time 27 MNOs and MVNOs on their. Iot strategy. So some of those are companies that are focused exclusively on iot. Some of them are big telcos where IOT is just a part of what they do but almost invariably have a business unit focused specifically on that that IOT piece. So we, we get into discussions around how you address global iot connectivity, what your software and middleware stack looks like. What your products are in the space is [00:04:00] generally trying to get to a view on what the capabilities and strategies are of those players. And the, two sides to it really in terms of what we're trying to achieve. One is, well, we're looking at what some of the key trends are that come out as a result of that. 'cause obviously you do those deep dive conversations with all these companies, you get a pretty good idea of what's what looks interesting and on what's going on in the space. But also it's a way of providing. Enterprises with a independent view of who are the best players in the space, able to address what their requirements might be, depending on which vertical they're in, which geography they're in and so on and so forth. So really two, two angles to it, but it's a, yeah. Significant piece work. CHARLES: So this is your 10th rendition. Let's start off with something fun. What was the most surprising thing that you found out in this version of the IoT report? Matt Hatton: There shouldn't be too many surprises given that this is kind of core stuff that we look at anyway, but they're really, I thought you were gonna say CHARLES: somebody cracked, it figured out how to solve all the problems. Matt Hatton: There are always surprises right there. [00:05:00] Certain things come up that are much more a focus for those those 27 players or a healthy slug of them than we might otherwise have expected. And so I can point to a few that are interesting. One is around the. Slightly nebulous term of localisation right? Firstly in a need to move away from using roaming and putting in place local infrastructure in order to manage data locally, in order to cope with increasing requirements for low latency, large volumes of data, that kind of thing. We've got the growth of technology called SGP.32 for esim localisation There's also requirements around regulatory compliance and so on. So that was one of the big themes and the degree to which that's important I think was a little bit of a surprise notable trend, certainly. Another one was the use of ai. I'm sure we'll talk about AI as we go through this. You really can't avoid it as a topic. Right. But I think we're CHARLES: contractually required [00:06:00] to actually not Matt Hatton: yet. definitely any technology podcast has to mention AI at some point that we've got it in early. But the thing this year was. We asked last year about how companies are using AI for their own internal purposes. That was an interesting thing we thought. And the reality was 12 months ago, a little over 12 months ago when we published the previous iteration, it was really quite mundane use cases. So it's chat bots and it's maybe some coding, maybe a a bit of support on sort of workflow management things like processing invoices and that kind of stuff. Things that aren't really particularly, specifically related to iot connectivity. Any kind of organization is potentially making use of AI for those kinds of uses. But what's come through this year is actually, it's rather more focused on the core business things to do with, capabilities for anomaly detection or automation of the processes within the actual IOT [00:07:00] specific operations. So that's a pretty interesting thing. I mean, it's slightly incremental, but it was quite a change from what we'd seen in the previous year. Probably the most interesting one, I would say was, almost a diversification out of iot for a lot of these players. Not that they're not doing their core IOT stuff, but just finding other things that are adjacent And I'll give you a few examples. Like, fixed wireless access FWA being probably the most prominent example, which, you know, debate amongst yourselves, whether that really counts as iot, probably not. But is there that much difference between fixed wireless access and a managed gateway that's supporting iot connections? Well, not really, but it's definitely a pronounced trend not least because. Everybody who's involved in this space has got very capable technologies, particularly around things like esim localisation and multi MC and so on [00:08:00] that can be pointed at those kinds of those kind of products. And that's a product with a revenue per connection of 50 bucks a month or maybe even higher, rather than the typical $1 a month for iot. So you can kind of see what the appeal is of going after some of these other alternative areas. It's even more pronounced in some cases. So you've got almost into the enterprise mobility space managed. Tablets even some of the players getting more into regular enterprise mobility propositions. SOCOM is doing this tie up now with ban's, MVNO, which was supporting enterprise customers and they're pointing their IOT stack at what was historically a set of enterprise customers. So that's pretty interesting to to watch and actually mirrors something we've seen from say Cisco, where control center was very much an IOT product and actually they're now looking, it's now more about the Cisco mobility platform. And so [00:09:00] they're obviously seeing opportunities with things beyond just iot. So that was pretty pretty interesting we think. And then the other one was increasing depth on horizontal propositions. Historically a lot of the MNOs particularly might have seen and being told that the universal panacea for how you how you generate more revenue from iot is to go up the stack and develop vertical solutions where you're getting into fleet management and retail and a whole bunch of other areas. And historically we've advised people very much don't do that. It's crowded marketplace. It's pretty difficult to get traction. You probably don't have the channels. It's tough to do. So there's been I think a realisation that's the case. There's some exceptions but certainly there's a realization of that. But what we've seen is deeper horizontal propositions around things like I mentioned, managed gateways. Managed gateways with a created set of sensors that could be pointed at a whole variety of different use [00:10:00] cases. Whether that's in, I dunno, retail or , hospitality you name it, you could put these more, more horizontal propositions into those spaces. And you don't need to go up against established vertical specialist companies. And another one would be video. So video cameras which then the vertical specific application-specific stuff is all handled at the software layer, because you are putting in place a managed video service, maybe with an edge gateway that handles some of the processing. And then you can put that into all sorts of scenarios. So retail and industrial and, you know, you name it, transportation. And then, build on from that horizontal stack by kind of layering on a vertical specific software which the connectivity provider isn't necessarily specifically responsible for. CHARLES: I think it's interesting about the video. It's something that I thought would've taken off a lot sooner and I'll give you a great example of how you can use same technical solution to solve two different problems. When I was doing work with type A City government. They [00:11:00] ran an a proof of concept in association with the City of Amsterdam. So they used this video camera, which just did video analytics, and what they used it for in Taipei was for security around a school. And in Amsterdam, they used it to track people urinating on the streets. Matt Hatton: That in, in itself is the great thing about this as a space. I mean, effectively you've got hold over the cameras that are out there already. So you've got it's in many cases kind of upgrade of brown field deployments by putting some kind of edge gateway in there too. So you don't, so it's not a person sitting on the air managing it. It's, you can apply AI to, to identify, well, the most basic case security video surveillance, but then. Adding in additional, more sophisticated use cases around PPE detection all the way through to things like workflow optimization, you know, you, you can keep adding these, the, these additional pieces of functionality to what is ostensibly a brownfield deployment. So that kind of upgradability, I think is very exciting in the [00:12:00] video analytics space. And we've seen quite prominent propositions put into the space by at and t and Verizon and and a few others that, that, that really I think have quite some some potential. CHARLES: And you're right on this one as well, because those consume more data. That's more data revenues, and that's money which they're not making right now on 5G. Otherwise. So hopefully they can use this to actually drive some new revenue streams. Matt Hatton: Well, moot point really. Because I, ideally maybe you'd want all the processing to happen locally on the device. Yeah. To, so all you are really doing is triggering alerts saying, right, I'm gonna send an MQTT message to some kind of backend system saying I've spotted a person, or I spotted a dog, or there's somebody not wearing the PPE or John turned up for work at this time. So actually maybe it's about optimizing that amount of traffic, not just about pure bandwidth being driven and therefore revenue. But then you start getting to maybe value based selling rather than selling megabytes and gigabytes of data. They're gonna be much higher [00:13:00] revenue. Use cases, certainly. CHARLES: Well, I hope the operators can actually learn how to do value-based selling because I mean, it was over 20 years ago, I was brought into O2 to do it around the blackberry of all things when that was first being launched. I did it at Vodafone as well, and at BT it's a struggle. You did mention a couple of the big players and I want to talk about this because like the ones who come out on top in the report it is your Vodafone AT&T Verizon. Yeah. Now, what are they doing that the others aren't doing? Is it just because they have a broader offering and are they really excelling or are they just doing it better than the other telcos? Matt Hatton: So I should take a little step back and say. There's two dimensions that we're measuring One is a horizontal measure, which is how are you able to support global iot connectivity? Have you got a scalable set of functionality? Have you got the things to do, devices and consulting and a whole bunch of other other capability around that. So that's one dimension. The other dimension is vertical now. And that's specifically have you got [00:14:00] experience of addressing this vertical one, one of the tenets of what we tend to talk about in iot? So one is the fact that all iot works differently. So the ability to support connected cars is rather different from the ability to support Smart Matrix. You kind of have to think of those things separately. The second thing is there's a big tendency within IOT to talk about we can do this. And actually we often advise potential buyers that what they really should be looking at is have they done that? Experience in a space is a critically important thing, you don't wanna be paying people to do their learning on the job. And so that vertical element is largely down to have they got the have they done the hard yards? Have they got a set of customers that sit in that space and have been using them for a period of years. And the ones with the scale tend to be the big telcos, right? So that's at and t and Vodafone and Telefonica and Verizon. And so it tends to be on that [00:15:00] dimension that they they win, right? In terms of the overall analysis. But there's a lot of MVNOs out there doing some, doing very interesting things. So on that horizontal dimension there's tools that are more developer friendly more flexible and intelligent ways of providing global iot connectivity. So it tends to be a very closer run thing on that horizontal measure rather than the vertical. CHARLES: Now I want to talk about a couple challenges that we face around in connectivity industry, and part of it relates to the network fragmentation. So when you talk to people who have a solution and they're going into different markets, they never know what type of network they're gonna be running it on. So you've got people turning off 2G 3G you've got patchy rollouts on 5G, you had NB-iot nobody did much with it. Now people are starting to turn those off. Are we getting to a point where there's gonna be less fragmentation now we're gonna have some baselines that would allow us to drive more adoption, or is it just gonna be continual fragmentation and chaos? Matt Hatton: I'm afraid it's more the latter than it's the former by quite some way. The [00:16:00] mobile industry doesn't really help itself. I sometimes draw a comparison. With something like Laura Ware, where effectively the development path for the technology there has been incremental. You add a new feature, a new piece of functionality into that technology stack. And it keeps going pretty much all backward compatible with what was there previously, whereas with cellular world is much more choppy, introducing a new technology which might or might not be backward compatible with what was , there already. Now that's. In a way it's a good thing because the capabilities that are being introduced are very useful for addressing iot. I mean, you mentioned about NB-iot tremendous technology. If what you want to do is within a single country, because you can't guarantee that there's gonna be networks available everywhere within a single country. If you want to connect a lot of devices that are underground or in difficult to reach places or do it in a cheap way, that's got long battery life, right? Far superior [00:17:00] to what you would've had with connecting things with LTE. But the most important characteristic of a network is that is available at all. And so having networks that, that are not available makes it somewhat challenging. You can look at. Two sides of the, of this with regard to specifically NB iot, you've got At&t deciding it's gonna switch off. Its NB-IOT networks. Hard, hardly a vote of conference for the technology. But at the same time, in Spain, you've got as of 1st of January next year, I think there, there's a requirement for having a, a beacon within every car for breakdown alerts. And those are NB-iot connected and there's gonna be 25 million of them or so, something along those lines. So, you know, try telling people in Spain that the NB-Iot is not gonna be a successful technology. I mean, there's millions of these devices, tens of millions of these devices, and anyway, where you're deploying smart metering, you know, it's a great technology for smart metering, but what it tends to be is much more about national deployments [00:18:00] rather than being deployed globally. It's kind of challenging for anybody who wants to put connections into, you know, a dozen markets and finding an appropriate technology. And what we've seen is almost a step back and people say, well, maybe LTE cat ones this tone down version of LTE, well, at least the LTE networks are there and available to use. I can use this as a technology. Is it as good in inverted commas as a IOT technology compared to N-B-I-T-L-T-M? No, probably not. Is it available? Yes. So, and is it good enough? Yeah, exactly. So, so it does the job and then you get onto, okay. The other part of your question was, prognosis, what happens further down the line? Is there some way that all of this converges onto one established standard? Well, the hope for that was that it would be as part of 5G with red cap and then e red cap beyond that and so on. But no I'm not holding out much hope, certainly for red cap, which is neither cheap nor long battery life. So useful for certain use cases but really not, it's not for most iot E red cap [00:19:00] kind of heading in the right direction. But we are still, I think, a couple of generations away from something which would provide the kind of functionality that MB iot might do. So it, I can't see anything changing in that degree of fragmentation really. It's it's unfortunate, but that's the case. CHARLES: Well, it's always been a challenge and it continues to be a challenge and unfortunately it holds back the industry, but hopefully some things will come out in the future to make it a little bit better for us and a little bit easier. Yeah. The next thing I would like to go into is I wanna talk about SGP 32. As you know, in our industry, we love throwing around terms and whatever, and not everybody always understand them. Yeah. Like I was one of the people who did not really know what SGP 32 was until relatively recently. And when I figured it out, I'm like, actually this is pretty cool. Yeah. So it's a big portion of your report talks about this. Give me your overview in layman's terms so everyone in the audience can understand about what is SGP 32 and why is it important? Matt Hatton: Yeah. I mean, if you think about what the most. Obscure terminology for an acronym you could possibly come up [00:20:00] with. It would be something like SGP 32. But what's quite strange is that we actually have quite a lot of our enterprise customers coming to us and saying, we've decided to use this technology. Having heard about it, even though it's pretty obscure. But the reason for the excitement about it is that it definitely, eases the ability to support multi-country iot connectivity. But let's take a step back. What is it? I mean, going back to first principles, I think it's worth thinking about, the sim card, we all know what a sim card is. Now, with iot, the plastic simcar wasn't appropriate for many use cases, quite big once you put the housing in there, it's not very good with humidity. It's not very good with extremes of temperature or vibration and so on. So it's necessary to develop a soldered sim, right? And we're still on the physical form factor here, right? So salted sim that goes onto the board of the device. Now, obviously then how do you switch? Profiles. How do you change the SI within something that sold it in? Well, you need a remote SIM provisioning a capability to, to change [00:21:00] that. The GSMA introduced something called SGP O2, which was the M two M standard. And the idea behind that was to allow the operators to hand over connections between them. But it was managed by the operators which meant that it wasn't particularly user friendly for the for any enterprise wanting to wanting to switch around between carriers. 'cause it kind of needed them to buy in and handle it. Whereas what was evolved for smartphones was something called SGP 22, which was the consumer variant. It's described as, and there the user can pick. EIM profile, they download onto their device. Obviously whole lot more freedom. Problem is, that's not entirely appropriate for iot. 'cause most iot devices don't have a person on the end. So the DSMA then developed 32, which was effectively a a variant of that consumer one, but with an agent on the device to allow the owner of the device to switch profiles according to their requirements. So the customer than them [00:22:00] has a lot more freedom. It allows you to much better reflect the the needs to localise your connections in order to provide superior latency and avoid having to do do roaming. What we're expecting is a lot more connections will effectively localize onto a local network operator and allow the the customer to manage which networks they're supported on in theory. But it's not a magic wand. There's a whole lot of other things happening in the, in, in the background. You need commercial relationships with all the carriers. It's that you're gonna be localizing onto. And we tend to think of it as being much more of a managed service that's being provided rather than, just user picks, whichever operator they want to support them. And off you go. So it, it does provide a significant degree more flexibility to be able to select which network operator is providing the connectivity to that device. But it doesn't it doesn't solve ev everything. And it also much better reflects that requirement for localizing [00:23:00] the connections which we see as being increasingly important when you have much higher bandwidth applications. There's regulatory requirements for data to be managed in country. Have I summed that up reasonably? CHARLES: Yeah. I wanna ask you a question about this and see if this makes sense. So like a number of years ago I was friends with a guy who runs a smartwatch, company outta Shenzhen. And they had this amazing medical alert smartwatch that they deployed in France and they deployed in the us. Getting it to market was not a problem, but in both countries it took 'em over two months to negotiate a deal to get the connectivity under the watch. At this time it was a 4G connected smart watch, you know, for emergency alerts. And it was a lot of it was for elderly care management. What we ended up doing that I took 'em to one of my other clients who provided eims, we stuck an EIM in there and then they could now basically launch it in any country around the world. Is this a similar type of thing we're talking about with SGPP 32 that if I'm going to manufacture a device, I could stick this in and in theory it can go into any country that supports it and I could just turn it on locally so they [00:24:00] don't have to worry about getting connectivity local in that country. Matt Hatton: Yes. I mean there's a lot of caveats to add to that, which is a, assuming that operator makes the profiles available, I mean, why wouldn't they? But because they're operators. Yeah. Well, putting a bit of friction in the system is not unknown, shall we say, CHARLES: but it would be great for the ecosystem because if I'm manufacturing a piece of kit right now and I wanna take it into five countries, I have to deal with connectivity in every country and it becomes a hassle if they all support it, all those five countries, and you could embed that into the device at manufacturing, would it make it easier to roll this stuff out? Matt Hatton: Not necessarily. 'cause you still need to negotiate with all those players for commercial relationships so actually you might find that what. What you end up with is a similar kind of a relationship to what you might have had before, which is you go to a single connectivity provider who historically might have supported it via roaming or multi c and they will support it via eim localization, but handled via their partnerships and them handling all the or the carrier [00:25:00] relationships and also being a single point of contact for customer support and for billing inquiries and all these various other things. But is a tool for those companies to, to be able to support connectivity. Yeah, it's absolutely great. The question might be if you are a car manufacturer. You've got scale of tens of millions of devices. Does it make sense for you to have relationships with quite a number of network operators in order to specifically localize onto operators as you get into market? Yeah, it might do, if you are selling, you know, a few thousand heart rate monitors or some other kind of re relatively small deployment, are you really gonna go around and make all those negotiations? Or are you gonna actually be looking for a third party to do it for you, which would be Yeah, be enough. Right? CHARLES: Okay, so basically I was a lot more optimistic about this before I chatted with you. Well, Matt Hatton: no, I mean, don't get me wrong. It is a tremendously useful technology. I think the fact that it, what you end [00:26:00] up with is a lot less use of roaming. So your compliance and your latency and your overall management of the of the device is much more efficient. What it doesn't necessarily do is change the relationships between the various players. In everybody's case, you know, there will be some who will want to manage all of this sort of stuff themselves, multiple operator relationships. But many won't wanna do that. CHARLES: Okay. Well, let's take it a step back and just look at iot in general. Now, we've both been in this industry for a very long time. You longer than me even, 'cause you were doing it in the telematics days. Where are we right now? Is it finally ready to take off a bit? Are you seeing some trends in the industry that make you more bullish on the future, or is it still gonna be struggling along because we have issues around connectivity and everyone's now focused on ai? Matt Hatton: We get this question a lot, right? why has iot failed Why has IOT not hit 50B connected devices? That's a topic for another day. We've been forecasting this market for a very long time, right? Since 2011 we started doing iot forecast. And our expectation was always. [00:27:00] None of this is a hockey stick. All of this is steady growth. As new technologies come on, on, on track, it opens up the potential for addressing certain, additional use cases. There's a whole lot of friction in the space that means that deploying use cases becomes more an incremental thing, and you get a kind of a gradual growth. The only exception would be regulated mandated use cases that, that example of Spanish traffic breakdown beacons is a perfect example. Suddenly there's. Several tens of millions of devices that need to be connected in a market. There, there are a few hockey sticks like that, but they're fairly few and far between. What I see as being different now from what might have been the case in 2011 say is about expectation and expectation management, right? This idea that, well, this thing's gonna go gangbusters and there's gonna be, tens or hundreds of billions of connected devices. You ended up with lots of companies that maybe it wasn't core business and they were taking a look see of what the opportunity might be [00:28:00] and then they got disillusioned. Perfect example PTC, which bought Thingworks back in 20, I wanna say 2013. Has now divested from that because it was non-core business, it didn't quite know what to do with it same with software Ag and Culo, they acquired that as an industrial IOT platform. And then it's been spun out again. That I think is the big difference from where we might have been 15 years ago, What you've got now is the specialist players who were here and were always gonna be here and involved in the space. Everything's incremental. We've talked about previously about how it's a whole stack of different technologies and and functionality and there's no getting away from the fact that. You'll get incremental improvements in some of those pieces and that will open up different market opportunities and maybe you get a little bit more collaboration. And I think it's it's a gradual improvement. There's no there's no magic wand. CHARLES: I think the one thing that worries me is that at one point every major tech vendor, [00:29:00] had a role to play in iot and almost all of them have really stepped back a lot from it. So that worries me because you don't get them backing it. But then again, it's just a buzzword. And I want it to go to like business as usual, where we don't even talk about it as iot. We're just connecting things and deploying more devices as part of our normal business operations. Getting rid of that marketing buzzer around iot and just make it, no, I'm actually doing predictive maintenance, or I'm doing this becomes a normal term. Matt Hatton: It's the question which has been knocking around in IOT for a while of, is iot actually a useful term? And you could say the same thing about ai. Is AI a useful term for something which spans everything from chatbots to medical image analysis right. They, those use cases are as diverse, I would say as the iot use cases. But I don't think anybody's having a conversation about whether the expression AI is a useful one. And I tend to think a Al Mango, you know, al he, he, he's written the book, which is very much arguing. It's really useful that we have this term because it encourages [00:30:00] that kind of thinking about how you can, extract data from a diverse set of distributed assets and manage them and it's having that one central term is quite a helpful thing. And I tend to I tend to agree with that. CHARLES: Well, it's a lot more useful than the internet of everything. So thankfully that one went away, that having to explain that at events was doing my head in why are we doing this? We're just confusing people. Matt Hatton: That was Cisco and Qualcomm, that, tried to make something out of that, but that went by the wayside. On the topic of what the challenges are and what's holding things back it's not really about any particular element of the tech stack. I think the key thing is if I can say fomo. So it's really I think from the adopter side of things kind of encouraging, nurturing this idea that you may be missing out on some some benefit that that, that might be accruing to some of your peers. You're missing out on cost reduction improvements in your proposition an additional revenue gains and so on. and if you [00:31:00] can reinforce to potential adopters that they're potentially missing out on this opportunity to, you know, go big to scale, to really make a difference to the fundamentals of the business. I think that really is the key thing. And I think that's where we fall down a little bit as a space. CHARLES: Well, it all comes back to your value-based selling because if you have that business case that you could then go in to talk to somebody and you don't come in going, here's my latest widget. You can come in saying, this is how I'm gonna reduce your costs, drive operational efficiency, whatever it is. Yeah. And you're selling value to them instead of selling them a piece of kit. That's one thing I think the industry needs to understand more is, be able to have the first 15 minutes of your conversation with any client you're going to talk to, and don't talk about your kit, talk about their business, understand what their drivers are, and show how you can actually drive measurable, tangible benefits for them. We're getting better at it. There's a lot of room for improvement here. So I think we're moving in the right direction, but it's not gonna happen overnight. That'd be the one thing I would try and fix. But we did talk a bit about AI in there as well, so I wanna come back to [00:32:00] this and I mean, I have a lot of people asking me, is it bad for iot? Because everyone's now so focused on ai. And the way I look at it, maybe I'm just being too simple about, it's, I think it's a good thing because artificial intelligence becomes valuable when you have more valuable inputs going into it when you get data points going into it. So if I wanna leverage AI to manage my industrial facility, to manage my sewers or whatever it might be, I could use artificial intelligence to do it, but something's gotta collect the data. So I think in a way that could almost. Pull business through for iot in that case. Now, is this me just with rose tinted glasses, or am I way off on this one? Matt Hatton: No I think that's, I think it's completely right. I would say that the greatest amount of value that AI is gonna deliver and value is a bit of a nebulous term, is on interacting with the real world. Okay. Autonomous driving or making fleets more efficient in terms of reducing fuel consumption there's a whole stack of areas where the [00:33:00] application of AI to the real world or in interacting with the real world is a critical thing. And that's where IOT sits. It's where the virtual world and the real world I interact. The video analytics use case perfect example, right? So that's about observing the real world and then making use of AI to act on the information that's flowing through. And, you know, AI will want to hoover up as much data as it possibly can in order to be able to support all these the, these various use cases. Iot is the eyes and ears for AI they're kind of mutually reinforcing really. CHARLES: Well. That's what I'm hoping at least. And I'm hoping we'll start seeing some of that coming up and then next year, which is a good segue into that 'cause that's what I want to talk about next. We've had a lot of these years where it's been not much progress for iot, let's just say it hasn't lived up to expectations. What are you looking forward to, or what do you think is gonna drive adoption in 2026? Matt Hatton: Number one, it's gonna be that interaction with ai. We've talked about a whole stack of areas where those things overlap. But the video analytics is one [00:34:00] that we flag up ev every year we do a transition topics. We look at, okay, well what do we think are gonna be the big things in IOT over the course of the following 12 months? And those two feature pretty prominently. The the interaction of AI with iot and particularly the the adoption of greater amounts of video analytics, plus the use of AI to optimize how IOT is delivered, the other big one's, probably compliance. It's not just a 2026 thing. None of these trends are ever like one year on their own. But compliance the amount of regulations out there around how you manage IO OT data, how you manage data more broadly, but with impact on on iot things to do with national sovereignty and data sovereignty. CHARLES: I think the one thing I'm hoping happens more in the coming year, and I think it's already happening a bit, I used to do a lot in the smart city space, another buzzword that sort of was big for a few years and then no one's mentioned it since. But cities still have a lot of work to do and when I talk to people who I used to know from the days when I was doing smart cities, they're [00:35:00] actually now starting to do a lot more implementations, and they're not doing the fun exciting ones, that are more about, improving the citizen experience. They're doing things about managing their infrastructure. And that's what I'm kind of hoping we'll see is people just doing it from the business case driven. It's not that I like this technology, it's that if I use this technology I can save a ton of money so that's my hope. But then again, I've also been disappointed by this stuff for a long time. I would love to see more global solutions. 'cause if you see global solutions that can drive value, that'll drive the market instead of just localized stuff. The problem is, as we've discussed, there's this whole connectivity thing. We haven't hit on satellite yet. Are we at a stage yet where satellite's gonna start having an impact on this? Or is it still just too expensive for the time being? Matt Hatton: Well, I mean, we've been using satellite for connecting IOT devices for decades, right? It's just a question of whether it's a affordable to do so. It would tend to be tracking high value assets, but it has become a lot more interesting in the last couple of years. You've had the release 17 non-terrestrial networks within the cellular standards. You've had [00:36:00] things like starlink introducing its CAT one bis service for connecting devices on the connecting cellular devices. It is getting increasingly interesting. Yes it means that the satellite space is gonna be moving much faster than the than the rest of the iot growth by wow. Not an order of magnitude but significantly faster than other iot. Just 'cause you've got these additional, you know, additional bearers and additional capabilities which can be pointed at at IOT devices. But there's still significant limitations, right? You still need line of sight with the sky. You've got the costs are going to be substantial because, you know, you gotta support it on a satellite rather than supporting it on a terrestrial base station. It's just inherently more expensive thing to do. So yeah, I mean we're expecting decent things, but it's gonna take a little while 'cause I'm not sure the hardware is quite there and might not be there for a little while and it's in inherently focused at a specific subset of of iot use cases rather than everything [00:37:00] but. Well, where it really looks interesting is if you are Starlink and actually you could start delivering a 5G standalone service from via a constellation of Leo satellites to a set to connected cars Teslas. Just as a for instance. It starts to look pretty interesting global alternative. It's got some legs. It's gonna take a little while, but, those those acorns are being planted. I'm not sure I've used the right analogy there, CHARLES: i'm still waiting for some big disruption in the industry to come from, well, let's say maybe one of the satellite players, whether it's gonna be starlink or Amazon. Why would they not try to take over the global telco market? Amazon's taken over everything else. They could wipe out the enterprise market relatively easy by going to HTC and getting the world's best phone design for you. Putting all your apps and services on there, leverage your networks around the world, but then also satellite. So I think it'd be interesting, but I think it's still a ways off on that one. Matt Hatton: And what you might find is it triggers some change of approach from the terrestrial based players, because inherently their cost base is gonna be lower. If they [00:38:00] choose to accept smaller margins on selling that connectivity, then it can move the needle back in the other direction, away from it being cost effective to support these things via satellite. Now there's cost effective and there's also complex, right? If you've got your own constellation, you completely control it. You can do whatever you like with it. So there may be associated benefits with that, rather than having to negotiate with a whole stack of different network operators. But if it forces them to rethink. Pricing, rethink how they orchestrate amongst them themselves. Then as I said, it could kind of switch back the other way. CHARLES: I wouldn't mind a little bit more disruption and, you know, chaos in there. I think everybody, I think the operators need a little bit of a shock to the system to just change their approach a bit. But we'll have to see. Yeah. So we've been covering off a lot on iot, but now let's close out with some fun stuff. Okay. Because let's face it, we've talked about IOT off and on for years. But we really got to know each other in the last year, and as you mentioned earlier, you're now my go-to guy when I need to manage my mole situation. Yeah. We regard still not having much luck. I'm worried all the moles and vols have [00:39:00] eaten the bulbs that we've planted for spring. So we're in Amsterdam, so obviously we wanna have a bunch of tulips. Sure. I think it's, I think they've been eating them all though. Matt Hatton: The economy depends on it. Oh no, hang on. That's a few hundred years a date. No, not so much anymore. CHARLES: Well, that was a heck of a hype cycle. Matt Hatton: Yeah, it was. Yeah. Yeah. Talk about CHARLES: Metaverse looked like nothing Matt Hatton: Tulip bubble in Amsterdam in the 17th century, I wanna say. But CHARLES: yeah. Yeah. That was the world's first market crash around the price of a bulb first hype cycle. I think that's when Gartner started their hype cycle, actually. Yeah, it could be. Matt Hatton: It could be. They've been around a CHARLES: while. But anyway, the other thing we've learned about each other is that we have very similar tastes in music. Which always scares me 'cause I think it, you know, I listen to pretty weird music, so I always, I do appreciate it when somebody else listens to it, but I want to go back 'cause most of it's more on the punk rock side. Or alternative rock, or however you wanna refer to it as. Let's find out more about your interest in music. What was your first show? Matt Hatton: First show is quite easy. It was a band called Ned's Atomic Dust Bin. I love 'em. And have a wrestle with that one. If you if you like, who were great Cell Green. [00:40:00] Yes. That, that, that's them. Kill Your Television. So they, that was, I'm gonna be dating myself now, but it's, I think that was 91, something like that. Yeah. Yeah. That when I was, that was my so that was my first ski. CHARLES: Yeah. I think my first one was actually, funny enough, the Kinks. My first punk gig, I'll never forget though, I think I must have been 14 or 15. There was a Chicago band called Naked Reagan, who I then went to go see probably 20 times over the next few years. And it really got me into the whole music scene then, because I would go to these shows and it was great. It'd be like seven bands for seven bucks. So slightly different than nowadays. All right, so now we've looked at the first show. What about your favorite band? If you have to go through all time, who is your favorite band? Matt Hatton: Yeah, favorite band's Quite easy. It's it's a British band, Welsh band, specifically called Manic Street Breaches. Now very well known in the UK and a bit in Europe. Really not known in us at all. , When they started in late eighties, early nineties, they were very close to the [00:41:00] Clash. But then. Kind of ended up developing a bit of a reputation of being sort of dad rockers, which was entirely unfair. And it's an incredibly diverse back catalog. They've got, and I tend to tell people, you know, if you think you don't like the Manistee preachers listen to a different album because they have such a diversity of CHARLES: I spent a decade in London and they were big then, so I know a lot of their music, so I've always appreciated 'em. I think for me, I'm gonna go with no effects. For me, it's just, okay. There's so much music over the last, what, 35, 40 years or whatever they've been around. It's close between them and Bad Religion. But I think No Effects is still my favorite one. But there you go. Alright. Now Matt Hatton: you're stick you're sticking very closely to the punk theme. Whereas I've, I, there's probably a day CHARLES: that goes by where I don't listen to no effects. Okay. It's in almost every single playlist I have. . So, and by the way, if you haven't listened to the album they did with Frank Turner, where they did covers of each other, ah, yes. It's totally brilliant. Actually I think Frank Turner does a better job on that side than no FX does that, he did some brilliant covers. Matt Hatton: That's a man I've seen perform many times. Incidentally so one very tangentially relevant thing to, to iot is the Manix had [00:42:00] a, an album called this is My Truth, tell Me Yours. Which is a quote from a guy called Vin who was the, grandfather of the NHS and I tend to put up a slide at the start of some of my presentations, which just says, this is my truth. Tell me yours, you know, this is how I see the market. How do you see the market? I think it's I think that's a good attitude to to have, CHARLES: because everyone's gonna have differing opinions, so you might as well start the debate. Debate is much more fun than just telling people what to think. Matt Hatton: Exactly right. CHARLES: Okay, next one. Best show of all time. Matt Hatton: So this was the single hardest question that you that you posed to me a ahead of time, so I did get time to think about this one. I think a lot of it's about context, right? It's not just, you know, was it a great performance? A lot of it's context and there's a band that I've loved since I was, quite young. Cool. Faith No More. Oh yeah. You're familiar with them of course. And so I saw them first in probably 1991, something like that. And then they weren't really touring a lot for quite a long time. And then I caught 'em again last time, about five years ago. And it had [00:43:00] been a long time and it sort of felt like seeing an old friend again and that, that kind of emotional thing about, you know, seeing this band that you've not seen for, I don't know, a decade or more certainly Yeah. I think was a, was a good thing. So I'm gonna go with that one. That was at the Roundhouse in, in London. Great. CHARLES: Great venue. Great venue. Okay. And, alright. And my best show was in weird one. When I was at university. Matt Hatton: I think CHARLES: it was $10. And the headline band was Red Hot Chili Peppers. And it was right when Blood Sugar, sex Magic came out. Yeah. The opening band was Smashing Pumpkins and Gish had just been released. In the first opening band no one had ever heard of, and they had just released their first album and it was Pearl Jam. Okay. So I saw Pearl Jam Smashing Pumpkins and Chili Peppers for 10 bucks at my universe with like a thousand people. Matt Hatton: That's phenomenal. Yeah. So, they used to be, I dunno whether you're familiar with The Enemy, the New Musical Express a music newspaper in in the UK they used to run these a annual sort of awards gig thing. Right. They had some awards and then they'd have gig and you can get [00:44:00] tickets to the things and the lineups. Those. You didn't realize it at the time, but you know, in retrospect, you can go, well, there was this thing where there was only about 500 people in the room and I saw Muse and supporting them were, you know, a couple other bands that end up being absolutely enormous. I Nirvana were in there one year as well. And, you know, it's just, it's a a stellar lineup of acts on these things, but only because, you know, they were only one album in or whatever on the as they went. But it's good one to to have ticked off all those. It's good. CHARLES: Okay. We'll close out with one final question here. And now this is gonna get you to look back at your career. So let's say I give you the chance to do it all over again and you can do anything but be an analyst and you cannot touch iot. What would you do with your career if money were no object? Matt Hatton: Something where I never had to look at a spreadsheet. That you can have that one for free. But then maybe if I'd never done it, I'd never realize how glad I would be never to have a look at a spreadsheet. Something that's a bit more hands-on, to be perfectly honest, chef, I would've loved to have given a boot up the ass to my university self to to say, you know, there's a bunch of people around here who are playing musical [00:45:00] instruments. You guys should form a band. You should, you know, get stuck in with that. And then ne never did and probably should have done. And, you know, that, that was that was a miss. But the time at university is probably the time when you want to get started on your musical career. That never was. CHARLES: Well, if I get a magic wand, I'll give you that gift and you can go back to university and start all over again. I'd love that again, just to go through the same music again. Alright Matt, well thank you so much for taking time today to talk about the latest report and to talk about IOT and where it's going. I'm not sure if I feel more optimistic. I was kind of hoping you were gonna say that there were all these great things going, but I guess we're making progress and that's all we can hope for right now. Yeah. We're learning from our past mistakes and if the industry keeps going better, we'll all be better off. Exactly. Alright, it's been a pleasure. Matt Hatton: Yeah, any, anytime. CHARLES: And I look forward to catching up for a drink soon. Maybe at m WC we have more music to talk about too. Matt Hatton: Yeah, do CHARLES: all right. Take care. Matt Hatton: Thank you.