The Beacosystem Technology Stack – We Have Liftoff

By Steve Statler, Advisory Board Member, Unacast

The Beacosystem Technology Stack – We Have Liftoff
In 2014 the Bluetooth beacon ecosystem has evolved and grown substantially. It promises explosive growth over the next five years. We can now apply some structure to understand the mass of new companies that are competing to win a race to bridge the digital to physical divide. In this article we outline a draft of what we are calling the Beacosystem Technology Stack, designed to help make sense of a very important part of the Internet of Things.

Hype is an explosive but necessary ingredient in the rocket systems required for any new technology to achieve escape velocity. The gravitational forces of fear, uncertainty and doubt are powerful. Without a massive injection of hype, entrepreneurs, VCs and early adopters will fall to their doom before the pilot solutions can prove that the way is safe for the majority of industry players to join them. The beacon ecosystem is particularly challenging because while it looks like high tech, it requires brick and mortar deployments that move a lot slower than software deployments.

In 2014 the Bluetooth beacon ecosystem was pulled into the back of its bucket seat with the thrill of major G-forces, sufficient to put indoor location into a stable orbit. As a result we have seen something of the order of 100 beacon startups get funded, racing to find their niche. Giants of the industry Apple, Google, Qualcomm and Samsung have placed big bets and launched key offerings. The early pilot projects by the likes of Major League Baseball and Macys, are now transitioning from pilot to full deployment.

For any market to be funded, business plans are required. They range from boring (not funded), exciting (funded), crazy (not funded) and insane (acquired by Facebook). To develop these plans, business development professionals engage in a ritual of arm wrestling with their finance counterparts. Given the complete lack of certainty that most of these plans are based on, these contests should result in almost every proposal being canned. The only thing one can say for sure about any of these business plans is that the numbers will be wrong. It’s just not possible to predict early stage business results with certainty, while weathering a storm of unknown variables and unexpected events. Fortunately we have a solution to this problem; the industry analyst. In the beacon market, one of the best analysts, if not the best is ABI. In June of 2014 ABI predicted that total deployments of BLE beacons were forecast to grow from 65,146 in 2013 to over 60 million in 2019. The only numbers we can be sure of in their prediction are “2013” and “2019”. In other words, its highly unlikely ABI will have got it exactly right, but the numbers are big enough to be interesting and ABI will have done a better job than pretty much any one else in using a credible process to produce the forecast.

The analyst acts as the whipping boy of the boardroom. In the same way that royal children in days of old had a whipping boy whose job it was to be soundly beaten when their master got things wrong, so the industry analyst is prepared to brave the probing questions of dubious investors and produce numbers that would be the source of anger, hilarity and disbelief if produced by someone that worked in the same building as the people reviewing the presentation. So the BD guy and the finance guy agree to suspend disbelief, and the plan gets blessed.


Wednesday, January 21st 2015
Steve Statler

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