The Benefits of Integrated Connectivity for OEMs

As the Internet of Things and digital advancement continue to expand globally, hardware manufacturers are increasingly embedding connectivity directly into their products. This trend offers numerous advantages for OEMs (Original Equipment Manufacturers) and other hardware producers, enhancing their product value, customer experience, and market competitiveness. Key drivers are positioning embedded connectivity, which is gaining momentum, and the transformative benefits it offers to module makers and their clients. These include:

1. Enhanced Product Differentiation

Adding embedded connectivity allows manufacturers to offer unique features that distinguish their products from competitors. With integrated connectivity, devices can operate seamlessly within connected ecosystems, which provides a clear advantage in markets that value interoperability and smart capabilities. This differentiation attracts customers and adds long-term value to the brand.

2. Improved Customer Satisfaction and User Experience

Integrated connectivity contributes to a smooth and efficient user experience. It reduces the need for end-users to configure or troubleshoot network settings, allowing them to enjoy the product’s benefits with minimal hassle. By simplifying the user journey, manufacturers improve customer satisfaction, which can lead to higher loyalty and repeat business.

3. New Revenue Opportunities

Embedded connectivity opens up possibilities for manufacturers to monetise their products in new ways. For instance, they can offer subscription-based services or premium features that leverage the product’s connectivity capabilities. This approach enables module makers to capture value continuously over the product’s lifecycle, moving beyond a one-time sale model.

4. Reduced Support Costs and Issues

By offering a streamlined, pre-integrated connectivity solution, manufacturers can significantly reduce the support resources needed to troubleshoot connectivity issues. Embedded connectivity allows the product maker to control and standardize network configurations, making it easier to diagnose and resolve problems, ultimately reducing both time and cost associated with customer support.

5. Optimised Product Performance and Security

With embedded connectivity, manufacturers can ensure that devices are always running the latest software and security patches, as updates can be managed remotely. This capability helps maintain product performance and security, providing peace of mind to both manufacturers and customers that devices remain secure and fully functional.

6. Streamlined Regulatory Compliance

Embedded connectivity can simplify regulatory compliance, as manufacturers can work with providers who have experience navigating various international regulatory standards. By embedding network functionality upfront, OEMs are better equipped to comply with data privacy laws and telecom regulations in target markets, mitigating risk and easing entry into new regions.

7. Reduced Complexity for OEM Clients

For OEM clients, managing connectivity independently can be complex, requiring technical expertise and resources to handle carrier relationships, component sourcing, and network compatibility. With embedded connectivity, OEMs offer clients a one-stop solution that simplifies these complexities, allowing them to focus on their core business activities.

8. Better Insights and Analytics for Product Improvement

Embedded connectivity enables manufacturers to collect and analyse data on product usage, performance, and customer preferences. This information provides valuable insights that inform future product improvements, helping manufacturers refine their offerings based on real-world usage patterns and customer feedback.

9. Facilitating Long-Term Customer Relationships

Providing connectivity as an integral part of a product creates ongoing interactions with customers, which can help foster stronger, long-term relationships. As customers depend on the connectivity service for their product’s functionality, manufacturers have a direct line to engage with users and build brand loyalty over time.

10. Enabling Product Lifecycle Management

With embedded connectivity, manufacturers gain the ability to manage products throughout their entire lifecycle. They can provide over-the-air updates, troubleshoot issues remotely, and introduce new features as the product evolves. This flexibility enhances the product’s value over time and aligns with customers’ expectations for products that adapt to their needs.

Addressing the Challenges of Embedded Connectivity

While embedded connectivity offers substantial benefits, it also introduces new challenges in terms of operational complexity, regulatory compliance, customer support, and technical requirements. To address these, OEMs can consider various models:

• In-House Connectivity Management: Some OEMs choose to become a Mobile Virtual Network Operator (MVNO), acquiring licenses and sourcing connectivity from MNOs (Mobile Network Operators). This model offers full control but requires significant investment and expertise.
• Third-Party Connectivity Providers: Alternatively, OEMs may partner with global service providers to integrate connectivity. This model reduces setup complexity and regulatory burdens, though it may limit control over quality and customer service. floLIVE can help OEMs in selecting the proper business model in order to comply with regulatory requirements as well as optimising benefits, defining the most suited operational/commercial model and reducing the total costs related to embedding and integrating connectivity. From a direct approach, in which an OEM offers connectivity as part of their product line, to an indirect mode where an OEM partners with floLIVE and floLIVE provides connectivity to OEM’s customers. In both cases, floLIVE can automate ordering and provisioning of connectivity, including providing test kits which can be required in a fully self-service mode.

Embedded connectivity offers a path for OEMs to unlock new revenue streams, enhance customer satisfaction, and build a more robust product ecosystem. 

Check out this floLIVE-sponsored report from Analysys Mason to learn more about the integrated connectivity market for module makers.