{"id":3056,"date":"2018-06-27T16:22:48","date_gmt":"2018-06-27T14:22:48","guid":{"rendered":"https:\/\/blog.microtronics.com\/?p=3056"},"modified":"2024-01-02T11:51:34","modified_gmt":"2024-01-02T10:51:34","slug":"5-value-creation-layers-for-an-iot-application","status":"publish","type":"post","link":"https:\/\/microtronics.com\/en\/blog-en\/5-value-creation-layers-for-an-iot-application\/","title":{"rendered":"5 value-creation layers for an IoT application"},"content":{"rendered":"\n

Smart, connected products are hybrids, because they are composed from parts of the physical and digital world. As a result, in the Internet of Things, the business model inevitably mixes patterns of the digital and the physical (non-digital) world together.[1]<\/a><\/sup>\"5<\/a>Value-creation layers at an Internet of Things application<\/span>[3]<\/a><\/sup><\/p>\n\n\n\n

Using the example of QGate<\/a> the five value-creation layers of an IoT application are discussed. QGate is a smart home application. The \u201csmart\u201d connection plug for grounded plugs enables a lot of applications with some integrated sensors.<\/p>\n\n\n\n

Layer 1 \u2013 Physical Thing<\/h2>\n\n\n\n

The physical components of an application, in this example the connection plug, is the value-creation layer. On this layer the first tangible benefit is revealed to the user. In the current example, this is limited to connecting another device such as a fan heater to the connector plug. Due to is physical nature, the range of action of the connector plug at this layer is limited to its immediate surroundings.[1]<\/a><\/sup><\/p>\n\n\n\n

Layer 2 \u2013 Sensor \/ Actor<\/h2>\n\n\n\n

On layer 2, the physical thing is enhanced with a microprocessor, sensors and actuators, allowing local data to be captured and local actions to be performed. The benefit for the user can thus be significantly increased in relation to layer 1, but is still limited to the immediate environment.[1]<\/a><\/sup><\/p>\n\n\n\n

The \u201csmart\u201d connector plug used as an example has sensors for measuring the temperature, brightness, noise level and energy consumption of the device connected to it. It also has the ability to switch the power supply of a connected device on and off. In combination with an electric fan heater, for example, a holiday home can be protected from frost damage. The ambient temperature is permanently monitored by the temperature sensor. If required, the actuator activates the energy supply of the fan heater and thus creates a local benefit.<\/p>\n\n\n\n

\"QGate<\/a><\/figure>\n\n\n\n

Layer 3 \u2013 Connectivity<\/h2>\n\n\n\n

This level gives the lower levels access to the Internet. This enables global access to the sensors and actors.[3]<\/a><\/sup> The GSM modem built into the \u201csmart\u201d connector plug from the current example allows authorized users worldwide access to the data at negligible marginal costs.<\/p>\n\n\n\n

Layer 4 \u2013 Analytics<\/h2>\n\n\n\n

Connectivity on it own does not yet create any value. From layer 4 upwards the sensor data are collected, stored, checked for plausibility, classified and linked with data from other online services and the values for the actuators can be calculated. This Is typically done in the cloud.[3]<\/a><\/sup><\/p>\n\n\n\n

In the example of the \u201csmart\u201d connector plug this means following for layer 4. If several \u201csmart\u201d connectors are used in a holiday home, the switch-on and switch-off times of the various fan heaters are stored. The other measured sensor values (brightness and noise level) are evaluated to detect an intruder and the energy consumption of the individual fan heaters is recorded.<\/p>\n\n\n\n

Layer 5 \u2013 Digital Service<\/h2>\n\n\n\n

On this layer, digital services are created that can be provided globally in the form of a smartphone application or a web service. They combine the possibilities and functions provided by layer 1 to 4 and are thus inseparably linked to the data generating, smart, connected products. The characteristics of a digital business models apply to these digital services.[3]<\/a><\/sup><\/p>\n\n\n\n

On this layer, in combination with the \u201cQGuard\u201d smartphone application, does the \u201csmart\u201d connector plug become an alarm and monitoring system that, in addition to protecting the holiday home form frost damage, can also inform the user about the current state (e.g. temperature and energy consumption) and unauthorised intrusion. If a siren is connected to the \u201csmart\u201d connector instead of the fan heater, the burglar can be driven away by the generated noise. All these functions are available at negligible marginal costs.<\/p>\n\n\n\n

The bidirectional arrows in the 5 value-creation layers indicate that the individual layers cannot be created independently of each other. With a high-quality IoT application, the integration extends down to the level of the physical components and thus represents more than a mere addition of the individual layers. A separated consideration would make various attractive digital services impossible, which is why the development of hardware for smart, connected products is increasingly determined by the digital layer above them. The intertwining of the development of hardware and digital services is therefore becoming increasingly important.[3]<\/a><\/sup><\/p>\n\n\n\n

References list<\/h3>\n\n\n\n
    \n
  1. \u2191<\/a> Fleisch, E., Weinberger, M., & Wortmann, F. (2014a). Gesch\u00e4ftsmodelle im
    Internet der Dinge. HMD Praxis der Wirtschaftsinformatik, 51(6), 812\u2013826.
    https:\/\/link.springer.com\/article\/10.1365%2Fs40702-014-0083-3, S. 817<\/li>\n\n\n\n
  2. \u2191<\/a> Fleisch, E., Weinberger, M., & Wortmann, F. (2014b, August). Gesch\u00e4ftsmodelle
    im Internet der Dinge. Bosch IoT Lab White Paper. Abgerufen von White-Paper.pdf, S. 7 – eigene Darstellung <\/li>\n\n\n\n
  3. \u2191<\/a> Fleisch, E., Weinberger, M., & Wortmann, F. (2014b, August). Gesch\u00e4ftsmodelle
    im Internet der Dinge. Bosch IoT Lab White Paper. Abgerufen von White-Paper.pdf, S. 818f <\/li>\n<\/ol>\n\n\n\n
    \n

    Series: Moving into a new business era with smart, connected products<\/h2>\n\n\n\n

    Part 1: Introduction<\/a>Part 2: The importance of business model innovation<\/a>Part 3: Laying the foundation through strategic decisions<\/a>Part 4: Breaking the valid industry logic<\/a>Part 5: 5 value stages of an IoT application<\/a>Part 6: Transforming the value chain<\/a>Part 7: The value generation of things in the Internet of Things<\/a>Part 8: Fundamental design of smart, connected products<\/a>Part 9: Requirements for the technological infrastructure in the Internet of Things<\/a>Part10: Creating added value by advancing to smart products<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

    Smart, connected products are hybrids, because they are composed from parts of the physical and digital world. As a result, in the Internet of Things, the business model inevitably mixes patterns of the digital and the physical (non-digital) world together.[1]Value-creation layers at an Internet of Things application[3] Using the example of QGate the five value-creation […]<\/p>\n","protected":false},"author":1,"featured_media":14570,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","footnotes":""},"categories":[764,767],"tags":[],"class_list":["post-3056","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog-en","category-strategy"],"acf":[],"yoast_head":"\n5 value-creation layers for an IoT application - Microtronics<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/microtronics.com\/en\/blog-en\/5-value-creation-layers-for-an-iot-application\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"5 value-creation layers for an IoT application\" \/>\n<meta property=\"og:description\" content=\"Smart, connected products are hybrids, because they are composed from parts of the physical and digital world. As a result, in the Internet of Things, the business model inevitably mixes patterns of the digital and the physical (non-digital) world together.[1]Value-creation layers at an Internet of Things application[3] Using the example of QGate the five value-creation […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/microtronics.com\/en\/blog-en\/5-value-creation-layers-for-an-iot-application\/\" \/>\n<meta property=\"og:site_name\" content=\"Microtronics\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Microtronics.Engineering\" \/>\n<meta property=\"article:published_time\" content=\"2018-06-27T14:22:48+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-01-02T10:51:34+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/microtronics.com\/wp-content\/uploads\/2018\/05\/qgate_offen.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"2000\" \/>\n\t<meta property=\"og:image:height\" content=\"1333\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Microtronics\" \/>\n<meta name=\"twitter:site\" content=\"@Microtronics\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/microtronics.com\\\/en\\\/blog-en\\\/5-value-creation-layers-for-an-iot-application\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/microtronics.com\\\/en\\\/blog-en\\\/5-value-creation-layers-for-an-iot-application\\\/\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\\\/\\\/microtronics.com\\\/en\\\/#\\\/schema\\\/person\\\/cbf0f30a74afee2a2c4150a08e9259b9\"},\"headline\":\"5 value-creation layers for an IoT application\",\"datePublished\":\"2018-06-27T14:22:48+00:00\",\"dateModified\":\"2024-01-02T10:51:34+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/microtronics.com\\\/en\\\/blog-en\\\/5-value-creation-layers-for-an-iot-application\\\/\"},\"wordCount\":778,\"publisher\":{\"@id\":\"https:\\\/\\\/microtronics.com\\\/en\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/microtronics.com\\\/en\\\/blog-en\\\/5-value-creation-layers-for-an-iot-application\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/microtronics.com\\\/wp-content\\\/uploads\\\/2018\\\/05\\\/qgate_offen.jpg\",\"articleSection\":[\"Blog\",\"Strategy\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/microtronics.com\\\/en\\\/blog-en\\\/5-value-creation-layers-for-an-iot-application\\\/\",\"url\":\"https:\\\/\\\/microtronics.com\\\/en\\\/blog-en\\\/5-value-creation-layers-for-an-iot-application\\\/\",\"name\":\"5 value-creation layers for an IoT application - 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