Cloud vendors seek partnerships to leverage IoT analytics

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Enterprise’s transition to the cloud will drive cloud supplier data and analytics revenues to $56 billion (€51.8 billion) by 2026, according to ABI Research.

The new study found that as cloud suppliers continue to expand into the IoT value chain, their investments in data and analytics services are accelerating. The analyst house forecasts that cloud suppliers will grow their share of IoT data and analytics management revenues from $6 billion in 2019 to $56 billion in 2026.

ABI said cloud vendors’ services now are focused on data management, complemented by a generic analytics toolset, with their revenues coming primarily from the streaming, storage and orchestration of data.

In contrast, analytics services across cloud vendors are less differentiated, as reflected in pre-built templates such as AWS Sagemaker and Microsoft Azure Notebooks, both of which use the open-source Jupyter project. As many cloud vendors are in the early stages of investment in analytics, cloud vendors are relying on partners to address more specific, advanced analytics and vertical markets’ needs. 

“The overall approach shown by cloud suppliers in their analytics services reflects the dilemma they face in the complex IoT partnership ecosystem,” says Kateryna Dubrova, Research Analyst at ABI Research. “Effectively, do they rely on partners for analytics services, or do they build analytics services that compete with them?”

Analytics for streaming

Interestingly, all cloud vendors are building analytics technology for streaming into their portfolios to blend data management with near-real-time analytics on streamed IoT data.
AWS, Microsoft, Google, IBM and Oracle are all promoting their proprietary streaming solutions to differentiate themselves, accelerate time to market, and win customers.

Whereas companies like Cloudera, Teradata, and C3.ai are introducing streaming analytics services that are heavily reliant on open -ource technology, such as Spark and Flink.

By focusing on data management and streaming technologies, cloud vendors are ceding the advanced analytics market to other suppliers. This is, ABI states, “an excellent example of the ‘coopetition’ in the IoT ecosystem”, where cloud vendors are partnering with advanced analytics suppliers. 

Closer to the edge

This coopetition enables them to promote an end-to-end IoT technology stack, for example Azure and AWS have partnered with Seeq for its advance analytics capabilities. At the same time, other vendors, such as Oracle, Cisco, and Huawei, are pushing intelligence and analytics closer to the devices, expanding their edge portfolio. Such divergent analytics strategies represent the reality and challenges for serving a very diverse IoT ecosystem with IoT analytics services.

“Ultimately, businesses are moving to an analytics-driven business model which will require both infrastructure and services for continuous intelligence. Cloud vendors’ strategies need to align with this reality to take advantage of analytics value and revenues that will transition to predictive and prescriptive solutions,” Dubrova concluded.