Business Model Innovation Through Big Data: Data Market - 【2020】
business innovation through big data

Business Model Innovation Through Big Data: Data Market

Big data means “a lot of data”. Every machine and every sensor sends states to a management authority at regular intervals. This creates large amounts of data in a very short time, which must be processed further.
Everywhere in the company, more or less large amounts of data are created, which initially generate costs because the data must be saved first. As a result, however, many interpretations and conclusions can be generated for new services and business models.

The data is gushing like oil from an open source today. Those using the latest wearable produce about 700 megabytes per day, a Formula 1 car achieves 400 GB per race and an airplane with its more than 20,000 measuring points produces about 1.5 terabytes per day. In addition, there is data generated by online shopping, logistics and social networks. IDC predicts: more than five million terabytes will be generated every day in five years.

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New services and business models through big data

Big data means “a lot of data”. Every machine and every sensor sends states to a management authority at regular intervals. This creates large amounts of data in a very short time, which must be processed further.
Everywhere in the company, more or less large amounts of data are created, which initially generate costs because the data must be saved first. As a result, however, many interpretations and conclusions can be generated for new services and business models.

One of the challenges in production is to reduce downtime and extend intervals between maintenance. Thanks to intelligent analysis of sensor data, as well as error and failure patterns, failures can be predicted (so-called predictive maintenance) and parts can be exchanged before major damage occurs.
If technically complex products pass on their condition data to the manufacturer via the Internet, the manufacturer could send a service technician in time and gain points in the market thanks to the extended functional warranty.

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New business models arise from large amounts of data. Carsharing, offers via airBNB or parcel tracking illustrate the trend. Data linking (“I have to go somewhere, I need accommodation …” and “I’m going to xy, I have a room available”) this via the Internet is paving the way for these new business models.

This also applies to B2B companies. For example, pump manufacturers might have the idea of selling cubic meters of air instead of pumps, or industrial truck manufacturers offer transport services by the hour and therefore pay only for what is actually used, “pay-per-use”. A prerequisite for the acceptance of services is an intuitive and easy-to-use user interface, as well as often real-time data transfer.

Big Data Valuable

Much of this data is valuable. This means that useful information is generated that not only represents simple evaluations, but also leads to new business models. With these promises, many CEOs have made significant management investments easy.

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This money was used to equip products, production facilities and logistics components with millions of sensors, and classic business intelligence and analysis programs were updated with complex self-learning functions. But the promised new business models are lagging behind expectations, the money has gone and many CEOs are now becoming impatient. But improvement is in sight.

A mobile phone on wheels: cars mutate on platforms.

More and more examples show how data can lead to completely new business models. For example, automobile manufacturers are working hard to shift away from the importance of the vehicle as a hardware product. Instead, it is mutating into a platform for completely new services. “Today’s vehicle manufacturers see the car as a cell phone on wheels,” says Gartner analyst Peter Havart-Simkin. That means developing new shops for automotive applications and entertainment options that can be marketed by subscription.

Such services are not a one-way street. New sensors and new connectivity allow the vehicle owner to also generate new revenue streams for the platforms. For example, if it is raining right now or if you are stuck in a traffic jam. This data is continuously delivered to a cloud platform from which the weather service, a radio station’s traffic jam warning or even other vehicle owners can use it for a fee.

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Platform as a data marketplace

Automotive supplier Continental is working on exactly that business model. Hewlett Packard Enterprise (HPE) and Continental have introduced a platform for mobile data exchange using block chain technology.

With the possible access to more data, automobile manufacturers should be able to offer better and new services. In this way, HPE and Continental want to enable new digital mobility services and help car manufacturers to market their vehicle data.

Other examples are the new business models arising from predictive maintenance possibilities. This means that many machine and unit manufacturers can not only issue availability guarantees today, but also invoice their systems for their use. A big advantage: instead of causing high capital expenditure for customers as before, it is now only manageable opex.

Data is the oil of the 21st century, they say. But they are like crude oil: profits are only made when gasoline is sold at the gas station. The network of data refineries and data outputs is becoming denser.

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