We recently chatted with Nick Earle, CEO of Eseye, a Guildford-based IoT (Internet of things) company about his background, company, the current IoT landscape and what sectors IoT will disrupt next.
1. What is your background and why did you join Eseye?
I enrolled for a BSc in Science at Liverpool University, which in those days was essentially a combination of maths, statistics and physics where you used a computer to solve complex computational problems. It wasn’t until my third year that they realised that computing was a science in its own right and awarded me a degree in Computer Science!
Since then, I’ve had a pretty varied career, both from a geographic and a company perspective. I’ve been based in five countries, run global functions for two $50 billion companies (HP and Cisco) and worked for four start-ups – two as CEO. I’m still excited by all things tech and always will be.
One of the things I learned in my career was that technology always starts off as proprietary and then users demand interoperability between the different vendor solutions. When this happens, you get the inflexion point of mass adoption.
When I was considering my next role four years ago, I was looking for a big area of technology that had not yet undergone this transition to seamless interoperability; the obvious candidate was cellular-enabled IoT connectivity. Essentially, there are over 800 mobile network operators worldwide and every one of them has the same business model – they sell a proprietary SIM card which only connects to their network on activation. They either service the traffic themselves or choose which other mobile operators to roam onto.
The problem is that no single operator has enough roaming agreements to cover the whole planet, so this will never work for IoT, where users want every device to enjoy ubiquitous global connectivity from a single SIM and not to be forced to choose between operators’ SIMs on a region-by-region basis.
Eseye has solved this problem and so, after a couple of angel investments in the company, I first joined the board and then shortly after became the CEO. It was too good an opportunity to miss!
2. What kind of growth has Eseye experienced in recent years and what are your long-term goals for the business?
When I was at Cisco, we confidently predicted that 50 billion things would be connected by 2020. But when you now look back at what actually happened, we only saw 11 billion things that were connected. That’s a pretty big miss by anybody’s standards.
One of the principal reasons for this is the fragmentation of connectivity suppliers that I referred to. As a result of Eseye being able to offer near-100% connectivity globally from a single SIM, we have won some very big deals in some of the world’s largest companies. For example, we are a major supplier of connectivity to Amazon, Walmart, Shell, Philips, Sony and many others. We have over 2,000 customers globally, including four of the Fortune 10, and we are seeing significant increases in demand for our service in worldwide markets.
To fund this growth, we secured a £15 million Series B investment round in December 2020 and are already looking ahead at our next round. We’re deploying the funds to increase our resources and capabilities in many markets, but especially in North America. Over 50% of the world’s largest companies are headquartered there, so that’s where we see the biggest opportunity. In the long term, we hope we can build a substantial company in the IoT segment and become another British technology success story.
3. What effect has COVID-19 had on the IoT landscape?
There’s a saying I like; “You overtake on the corners, not on the straight”. It refers to the fact that change accelerates during a crisis, not when it’s business as usual. The data over the last few years shows this to be especially true in IT where most of the leaders of each new wave of innovation saw their growth and market share accelerate during economic downturns.
In IoT, this is definitely the case during the COVID-19 pandemic. The main reason is that the increased strain on company finances caused by successive lockdowns has meant that organisations need to find new and innovative ways to sell more, while at the same time dramatically reducing costs.
IoT turns products into personalised experiences for each consumer, which increases loyalty, while simultaneously enabling a new lower-cost sales model.
This is illustrated by what Costa Coffee is doing with its Express machines in the coffee vending space. Its coffee machines are marketed as a ‘Barista without a beard’, as they deliver a wide choice of shop-quality coffee drinks from a vending machine that takes up just one square metre of space. Each unit takes 90 sensor readings of the process and displays dynamic personalised advertising and promotions into the large screen on each device. The machines are located in other companies’ premises, such as petrol stations who, as part of the contract, need to keep consumables constantly topped up. This low-cost retail model can be compared to competitors such as Starbucks, which sells almost exclusively through retail shops with long leases on high streets that require multiple staff and lots of space for people to sit, drink and talk.
But there is another element that gives Costa Coffee’s Express machines a competitive advantage. This is known as the two-screen solution. In order to get your loyalty points for your coffee, you scan the QR code off the screen with your smart device, which then identifies you to Costa Coffee. This allows the company to discover a huge amount about their customers: who they are, what they drink, when and where they drink it and how often. Compared to other high-street coffee vendors that simply write the customer’s name on the side of the cup, Costa Coffee’s approach is marketing gold dust for the company.
4. How have consumers benefitted from IoT in the last 18 months?
Another area which has accelerated during COVID-19 has been the healthcare market. One of our customers, Alcuris, has created a very innovative solution for monitoring elderly people in their homes. Let’s say you have an elderly parent who lives on their own 200 miles away and you want to find out exactly how they are, yet you’re unable to regularly visit or contact them. Alcuris installs simple, low-cost IoT sensors around the home, which measure everyday activity such as movement in and out of rooms, for example, the bedroom and bathroom, and whether they have switched the kettle on in the morning, etc.
This data is made available to relatives through a smartphone app and also to carers, who can monitor their patient remotely and accurately. It’s a wonderful solution for councils who have a duty of care to look after elderly people in the community. Relatives can set up their own alerts as to what event they would like to be notified of and grade them by severity. It provides peace of mind for everybody and it’s a great example of how IoT directly benefits the consumer. Borne out of the COVID-19 pandemic, such technology will now become part of our everyday lives.
Another example is the rapid deployment of electric vehicle charging posts, driven by increasing sales of electric cars. It’s not only helping tackle climate change but also enabling consumers to be responsible for their own power management. Companies like Octopus Energy are now offering services where individuals can buy and sell their own power management through smart devices, such as the EV car charger or the smart meter in your home. This puts the consumer in charge and is another common theme of IoT, in that it collapses supply chains and empowers the true end-customer through an innovative, automated experience.
5. Has the UK business community embraced IoT? What more can be done?
Yes, but only to a tiny extent. The numbers tell the story. Of the 11 billion devices that have been deployed globally, nine billion of them were smartphones and tablets. Therefore, only two billion were true IoT devices. With the UK representing around 5% of the world market, we’ve installed about 100 million. That sounds like a lot, but the 50 billion forecast was based on the cost of hardware components 12 years ago. Those costs have all collapsed dramatically; we’re even now talking about very small thin devices where you can print the battery, sensors and circuit on a small sticky label.
This will open up an era of massive IoT adoption and rollout, which will take the number of connected devices up tenfold over the next few years. Therefore, whichever way you look at it, we are in the very early stages of IoT adoption, but the outcome is inevitable. Products will become experiences because the data about how a product is being used is much more valuable than the product itself.
The lack of adoption is not due to lack of awareness of the benefits of IoT, it’s principally because it’s still too complicated to implement for most companies. Take the IoT device itself. Unlike mobile phones, which are pretty standard, most IoT devices have to be custom-designed for the use case with a specific combination of firmware, sensors, modems, power, etc. We’ve spent the last 20 years in IT convincing ourselves that software will eat hardware, and everything is in the cloud but clearly, in IoT that’s not true.
This issue is the reason Eseye bought a device design company ten years ago, enabling us to help our customers create the device. In fact, that’s where we start – by talking through the use case and working with our clients on the device design. Most IoT companies focus on software or just the connectivity, but we think all three are hugely important.
6. What sectors will IoT disrupt next?
One of the biggest opportunities is equipment. Every factory, warehouse or building contains large amounts of capital equipment that does a specific job well, but is not IoT-enabled. This huge installed base of legacy equipment could become much more productive and efficient if it became connected and smart.
With the ability to create edge aggregation devices that can communicate with those devices via a variety of protocols, such as serial port connections, Zigbee or Bluetooth, we are seeing the emergence of a new family of edge aggregation devices that collect the data from the machines and smart-enable them. This enables business processes like maintenance to be transformed by remotely diagnosing faults before the engineer visits.
This automation will accelerate as technologies such as 5G and private LTE are adopted. Essentially, every factory, warehouse, or high-tech location will run a private network, which will connect together data from millions of sensors to give real-time monitoring of everything at all times. They will each run their own private network and process the data collected through advanced AI and Machine Learning capabilities to give real-time instructions to automated cranes, machines and robots, similar to those in Amazon fulfilment centres. It’s just starting now and is very exciting.
7. What are your future predictions for the IoT industry?
As everything gets connected, we’ll see the emergence of a new breed of companies that optimise specific business processes for multiple companies. For example, you might think of Ocado as an online grocery retailer, but it doesn’t own any shops. Instead, the company describes itself as ‘a technology company which specialises in automation and robotics, big data and the cloud, web and app development, algorithms and smart optimisation, and discrete event-simulation’.
That’s quite a mouthful but put simply, it collects vast amounts of data from the consumers, warehouse and from the delivery process, subsequently using AI software to run those processes better than food retailers. As a result, these companies find it cheaper to outsource these processes to Ocado rather than try to do it themselves. We’ll see many more examples emerge as processes are increasingly digitised and transformed by IoT.