Monetizing IoT services: from machine connectivity to revenue models

Many industrial companies have connected their machines and plants and set up their first data integrations. The real question, though, only comes up afterwards: how does connectivity turn into actual revenue – and how do digital services become scalable, secure and commercially viable?

doubleSlash Net-Business GmbH, a software and IT service provider from Friedrichshafen on Lake Constance (founded in 1999, around 300 employees, with further locations in Stuttgart and Munich), supports companies in mechanical and plant engineering and in the mobility sector along the entire IoT value chain. The foundation is a three-part approach whose stages build on one another: Connect, Make Smart and Monetize. The goal is not connectivity as such, but the digital business model that grows out of it.

The challenge: connected products alone do not generate revenue

Many companies have connected products and data read out from them, yet they are not tapping the business value. On the way from connectivity to revenue, several conditions come together that have less to do with things being neglected than with legacy structures and international requirements:

• Heterogeneous data sources that first have to be delivered to a platform in a uniform, standardised form before they can be used commercially.
• IT architectures that do not scale for the digital offerings already in place – for example when the software components for billing growing volumes are missing.
• Fragmented responsibilities: product management, sales and IT have to sit down together so that requirements are captured in full.
• Complex billing and tax logic in an international context – in Brazil and the USA, for instance, it differs from state to state, which ties up a lot of design time.
• AI's dependence on data: predictive maintenance first needs a sufficient, correct and standardised data history, which has to be built up over time.

On top of that, conventional ERP and accounting systems often cannot represent digital services, so workarounds tend to emerge in practice.

The solution: one continuous approach from connectivity to billing

doubleSlash works on the entire chain instead of looking at individual components in isolation. Monetisation is the goal that the two preceding stages consistently work towards. Rather than rolling out a rigid standard product, the provider combines pre-built, modular components with project-specific customisation.

Connect – the solid data basis: right at the start, the team clarifies which data a device generates and which of it will create value later on, for service technicians or customer service, for example. The heterogeneous data is standardised, structured and brought together centrally and securely. For mid-sized companies, doubleSlash offers a cost-sensitive entry point with the Update Manager: a configurable tool with adapters – regardless of whether a customer uses Microsoft Azure or PTC ThingWorx – that also addresses the update requirements of the CRA (Cyber Resilience Act).

Make Smart – data becomes services: AI-powered applications are built on this data basis. At ZEISS Microscopy, machine learning analyses the machine data from high-tech microscopes in such a way that service technicians can act before a failure occurs. ZEISS also uses generative AI that is fed with maintenance sessions, manuals and experiential knowledge: a chatbot gives less experienced colleagues concrete guidance on materials, tools and work steps.

Monetize – making digital offerings commercially viable: only once connected devices and reliable data are in place can business models be set up on a sound footing. At e-mobility provider EWE Go, machines and digital offerings were already there, but the IT architecture did not scale; the software components for billing were missing. doubleSlash carried out a vendor comparison, examined products that could be integrated into the existing architecture and involved the relevant roles early on. For digital in-car services – bookable assistance or comfort functions, for example – doubleSlash is responsible for the IT behind booking and billing, all the way to third-level support. A well-maintained partner ecosystem keeps the solutions compatible with changing legal requirements.

The result: recurring revenue and plannable service instead of connectivity alone

The end-to-end approach makes IoT commercially viable step by step – without overwhelming the people involved. Because the stages interlock, a connected plant produces not just a data stream, but a basis for new revenue models, recurring revenue and lower service costs.

The benefits become concrete in the examples:

• At ZEISS, service becomes plannable instead of reactive: because anomalies become visible earlier, technicians can step in before a failure occurs, and the generative AI assistant reduces the effort of passing on knowledge in service.
• At EWE Go, the scalable billing architecture creates the conditions for reliably billing growing volumes of digital offerings – the basis for sound revenue models.
• For the digital vehicle services, the end-to-end managed booking and billing chain creates a recurring service business that holds up in day-to-day operation.
• For mid-sized companies, the configurable, adapter-ready approach lowers the barrier to entry: a quick start without a large budget, while update and security requirements are met.

Transferability: the approach can be applied independently of any single platform, because components are combined rather than newly developed. Artificial intelligence will foreseeably shape monetisation further – for example by describing digital services in machine-readable form and tailoring offerings more individually on the basis of data. Anyone who has created the Connect basis can take this step towards recurring revenue in a targeted way.