IoT Changes Hardware Companies into Software Companies

By EETimes

October 22, 2015

Billions of new internet-connected devices will come online within the next few years. While these devices can call home with information and get updated in the field, what's most interesting about the rise of the Internet of Things is the new business models it enables.

Devices from tiny sensors to large pieces of equipment have increasingly become software-based, "intelligent" devices. As this transition happened, manufacturers naturally found themselves more focused on software development than on physical hardware design, and as a result, the value of their intellectual property increasingly became tied up in the software. As hardware vendors faced this transition, they found themselves facing some of the same challenges as traditional software vendors. They needed to address issues including piracy, reverse engineering, and intentional and unintentional misuse of their products.

Protecting IP (intellectual property) from threats is one of the first keys to monetizing it, but the IoT (Internet of things) didn't just create new risks from unauthorized software distribution and use, it created new opportunities. Connectivity enabled manufacturers to easily deliver, track, and manage end-user entitlements, thus eliminating manual operational tasks (and costs) associated with licensing, and helped them introduce new products and features more easily.

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