M2M Platform Shakeup

Reportedly, SensorLogic has closed up shop. Despite trying to make it work after several funding rounds, the word is that investors just gave up and the team reportedly has been sent home. After attempts to contact execs and former employees to get the “official scoop” nobody wants to go on the record. But the scuttlebutt behind the scenes is that investors couldn’t withstand another round of funding to continue operations. Those of us who have been following this industry long enough know this wouldn’t be the first blow to the SensorLogic team. SensorLogic was originally founded by Jeff Smith back in 2002, but he too never grabbed victory with investors and has since found greener pastures with Numerex.

I have searched the SensorLogic Website for some statement about its demise—the rumor mill has employees being cut just before Thanksgiving—but so far I have not been able to find anything.

The loss of SensorLogic raises a much bigger question about the platform market in general. Industry observers must now be asking: Is the M2M marketplace heading for a big service platform shakeup?

Let’s be honest, is the market for M2M platforms up for grabs? That’s the good and bad news for customers. At first glance it may seem the market for “platforms” in M2M would be plush given the fact nearly every company has adopted the term to define its respective services. However, what we are witnessing is a bit of a shake-up amongst the core group of players that are known to be the “true” platform providers. The question now is whether that leaves the door open for others to step up and close the door on the weaker players? At last count there were an estimated 40 or so that claim to be service-platform companies serving the M2M space. Perhaps a more important question becomes: What is causing some of these more traditional players to crumble like a house of cards?

SensorLogic is by no means the only services-platform company that appears to be a bit wobbly. You also get the feeling that Axeda, another platform veteran, might be on shaky ground these days. The company has seemingly riden a roller coaster the past few months, with some rumblings even coming from inside the firm saying it is in a “regrouping” mode as of late. In addition, it has lost several top head honchos in the past 12 months. And has anyone really had a serious conversation with founder Dale Calder these days? I know we haven’t.

One can’t have a talk about the service delivery platform market and not mention nPhase, the original one founded by Steve Pazol in 2003. Pazol was probably the smartest of all the players, selling his company to Qualcomm in 2006. Now look, with a little help from Qualcomm he has created a joint venture with Verizon that is allowing the revitalized nPhase to service enterprises across the globe.

All-in-all do these recent turn of events mean the investor community is getting cold feet on the platform space, expecting a faster return on investment. Or is it more a matter of the overall dilution of the term “platform” causing too much confusion amongst the corporate adopter community? In other words, did the SensorLogic and Axeda’s of the world do themselves an injustice by not doing enough to clearly distinguish themselves as being among the true platform providers, and as a result, allow others to step up and take marketshare away? That is the million-dollar question. The good news for Axeda is that it has a great partner network and there is still time to fix what ails it.

On the other hand, one has to wonder if some of the platforms companies have been keeping pace with the newbies that have entered the M2M race. By definition, a platform needs to provide the all the foundational services and capabilities that are required to build out M2M applications, and these days that means building on the latest and greatest technology, encompassing things like social networking, location data, and all these other wonderful  Web 2.0 technologies.  The race is getting faster and it appears others are making a better go at it with today’s technology than some of the original players.

Take a company like ThingWorx, for example. It’s fair to say that its platform is rather new to the game, building out about two or three years ago. And because of that, the company has been able to incorporate Web 2.0 technologies right from the onset; things like social networking or even search concepts—i.e., using the concept of tagging to tag and relate people’s data. Part of the social networking technology comes as a result of a very strategic acquisition in Palantiri Systems earlier this year. Then you have a company like Mesh Systems that presents a platform that consists of hardware, concentrators, and software that runs in the embedded device, as well as software that runs in a cloud-based backend.

There are others, but now the fight is on and it should be interesting to see who will win and who has the wherewithal to prevail in this next level of service.

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