Editor’s note: Most of the recent headlines about AT&T have focused on its offer to buy Time Warner. But there’s plenty of other news, too. AT&T, for example, is focusing heavily on Internet of Things, which is forecast to be a multi-trillion-dollar market by Cisco. So what’s AT&T’s strategy? Here’s an in-depth, two-part analysis.

HAMPTON, N.H. – AT&T is poised to disrupt the traditional IT hierarchy in the commercial Internet of Things (IoT) landscape. Intercepting emerging business deployments with its integrated suite of IoT and services capabilities will challenge the status quo of how IoT is constructed at the edge and moved to public cloud. TBR believes that, like other major IT players, AT&T aims to evolve into a full-stack IoT provider offering an end-to-end secured solution to customers.

AT&T’s ability to challenge existing IT vendors with this integrated suite of capabilities revolves around its M2X platform and Flow Designer cloudbased development tool, combined with scalable connectivity solution AT&T Network On Demand and security enabler AT&T NetBond. The combination, highlighted at its 2016 Analyst Summit in Dallas, will make the company an easier choice for customers seeking reduced complexity in their IoT deployments as it allows them to easily purchase an IoT platform, edge solutions, scalable connectivity and security from one vendor.

AT&T’s transformation from ‘telco to tech co’ is central to its ability to supply end-to-end IoT

TBR believes AT&T’s efforts to deliver a full suite of IoT capabilities, capturing opportunity from other IT vendors, is a result of its efforts to augment its position as a connectivity vendor. AT&T’s success lies in transforming from “telco to tech co,” and the company will not limit itself to connecting end-to-end infrastructure. AT&T will challenge the centralized analytics incumbents, such as IBM, Amazon Web Services (AWS) and Microsoft, in creating solutions, machine learning and delivering transformation. AT&T’s stronger position is encouraging centralized analytics leaders, such as IBM and AWS, to deepen partnerships with the company and leverage AT&T’s solutions to offer customers seamless, simplified conduits onto their clouds. AT&T will also be leveraged, by customers and partners, for analytics and transformation in areas in which AT&T has long-standing expertise, such as logistics. 

As the company moves to be more solution-focused, software-centric and ecosystem-enabled, AT&T is retraining its workforce, targeting new hires in STEM (science, technology, engineering and mathematics), pursuing the acquisition of startups, and soliciting the developer community through lowcost, high functionality developer kits to develop and test connectivity solutions to meet its IoT goals. The kits, which begin at $99, come with an IoT device SIM with a six-month developer data plan, offer easy integration with AT&T tools such as M2X and Flow Designer, and are preconfigured to major public cloud vendors. Strong developer support is critical to widespread adoption of AT&T’s IoT platform.

AT&T identified target verticals, such as telematics, smart city and healthcare, for which it will develop applications. AT&T is opening multiple IoT innovation centers globally to encourage internal change, to supercharge the development of solutions in the target verticals, and to provide locations for customers to whiteboard and develop IoT projects. Currently AT&T has six Foundry centers, including one in Plano, Texas, focused on business and enterprise solutions, and one in Israel specializing in operational efficiency and business process optimization solutions. In June AT&T opened an additional center in Houston that is integrated into the Texas Medical Center Innovation Institute and allows medical professionals to develop healthcare solutions with AT&T developers. AT&T is targeting healthcare as its next growth vertical.

However, AT&T realizes it cannot be everywhere and cover every vertical with best-in-class solutions. AT&T is positioning itself as a partner with solutions that can be easily integrated, filling deployment gaps for companies that may have a stronger foothold and more visibility in other geographies and verticals. To support this position, AT&T will offer operators the ability to build on its ECOMP (Enhanced Control, Orchestration, Management & Policy) architecture and build go-to-market alliances with IBM and CSC, expanding AT&T’s reach outside traditional channels. AT&T’s open and cooperative stance will foster high partner and developer activity, which are critical facets of succeeding in the IoT market, and will lead AT&T to become a common vendor for enterprises to evaluate, or partners to leverage, in connecting on-premises deployments to public clouds.

Part Two: AT&T differentiates by providing end-to-end IoT security

(C) TBR