IoT Penetration in Kenya, Are we there yet?

The availability of IoT technologies in Africa and Kenya specifically is a subject that requires constant analysis. It is important for technology providers to ask some key questions in order to ensure they optimize the adoption of this important technology.

I am unable to wrap my mind around the fact that despite the obvious benefits that can be harnessed by its adoption, penetration of this technology has not been as good as we expected.

Technology is quite dynamic, a few years ago; we were all excited by ‘cloud’. Now it’s IoT, quickly moving to block chain. Did we utilize/are we utilizing the full potential of the cloud? This is a question for another day. It will be sad though for us to ask the same question of IoT a few years to come.

IoT is a technology that can be used by almost all sectors of our economy. This cuts across key public service departments to Manufacturing, Banking, Transportation, Oil and Gas, Education, Health etc. The list is endless. Out of the above, minor adoption has been realized in a few of government departments, case in point the fertilizer subsidy program that is enabled by IoT. In the banking sector, banks have for a time now been able to connect seamlessly their ATMs and POS machines using IoT. In Transportation specifically for most commercial heavy duty motor assets, organizations are able to not only track location but also monitor optimal usage of fuel, driver behavior and in cold chain logistics, temperature, humidity, pressure and light sensor are significant value adds. Key question here is, can the data being collected every second be used more optimally? Are we harnessing the power of big data to ensure we are properly utilizing telematics?

Gartner puts the number of connected devices by 2020 at 20.4 billion. That will be more than double the current world’s population.

It is therefore not a question of whether the opportunity is there in IoT but, of, if the technology providers are creating the correct products and positioning them well to take advantage of this opportunity. Which brings me to another critical question; of the 20.4 billion devices, what percentage do we forecast to have in Kenya? And what do we need to do to achieve this number and keep our position as the Africa’s technology hub.

I sat down with Mr Reha Yurdakul, the IoT Champion at IBM East Africa to try and get answers to below questions.

1.      What are enterprise customers looking for?

2.      Why the delay?

3.      What’s the ideal approach?

4.      What should technology providers do?

According to Mr Reha, the biggest hindrance for enterprises has been unclear economic benefits. The cost associated with IoT adoption cannot be ignored, from device and platform acquisition to configuration and implementation and sometimes on skills, enterprises might be forced to hire special skills for maintenance of this technology. In as much as the key benefit for IoT is to improve efficiency and hence cut running cost in the long run, enterprises are not able to quantify short term cost cutting and this becomes a hard sell to the business. In this tough economy where lots of focus has been on cost cutting, then this will qualify as the biggest hindrance to IoT adoption.

 Enterprises are looking for efficiency, cost reduction and ability to use data collected to make quick but accurate business decisions. It is therefore important for industry players to come up with a different approach in positioning this technology.

Mr Reha suggests the below ideals;

1.      Phased approach - What if technology providers adopted a phased approach to the pricing and positioning of this technology. What if they invested now for the long term? Such that we increase the cost to the enterprise when they start benefiting from this technology. Take for example an organization that needs to connect their vending machines. The average cost of acquiring this technology per device is around $500. That could be more than the cost for purchasing a new machine. Building a business case for IoT adaptation in this case will be next to impossible.

2.      Block chain – Can the adoption of block chain technology in building IoT use cases bring down the cost of acquisition? Or even increase the value adds to the organizations. Reha believes so. The use of shared hyper ledgers will increase information reliability and accuracy thus adding extra value adds that can be used to build the business cases for adoption. For technology providers, block chain will provide a cost cutting benefit as they build IoT propositions thus making the acquisition cost lower.

3.      We cannot talk about technology adoption without talking about user education – it is the responsibility of technology providers to make sure the market has the right information and this technology is not killed by wrong perceptions as has been the case before in new technology trends.

Let’s make sure the market has the correct information, more importantly, let’s walk the adoption journey with them, and then we shall look back a few years from now and be proud of being part of the pioneer journey.