Q-loud’s Data Hub for Techem Is a Prime Example of Telcos’ Platform Business Aspirations

J. Marcus

Summary Bullets:

  • Q-loud developed an IoT solution for energy provider Techem, which it will deploy and operate.
  • Techem will offer IoT-enhanced smart building services to its customers in the real estate industry, leveraging Q-loud’s platform.

It seems like a pretty modest news item at first glance, a deal between a smaller German challenger in the IT and connectivity space and a specialist energy provider. Q-loud is the IoT unit of QSC AG, a business-oriented network operator and system integrator which has recently shifted its strategy away from traditional telco services for SMEs toward digital opportunities. The largest telcos in Europe, of course, are doing the same, trying to build new platform-based businesses. Some have made multiple acquisitions to get there (Orange invested EUR 1 billion in such acquisitions in 14 months), while the smaller QSC has taken a different approach: selling off a significant part of its telco assets to reinvest the proceeds in digital (the sale of subsidiary PlusNet earlier this year to EnBW Telekommunikation for EUR 229 million euros is funding development of its cloud and IoT businesses).

Q-loud’s deal with Techem, announced on September 9, looks like a contract win at first, but it’s not. On the contrary, while Q-loud developed the solution Techem was after – a platform for providing smart building management which it aims to bundle with its energy services for the real estate industry – it will remain a fully engaged platform partner which hosts and operates Techem’s new digital business. As one of the largest German providers of energy services in commercial buildings, Techem says it will rely more and more on a networked device infrastructure and data-based solutions in the future. The focus is on energy savings, CO2 reduction, and more efficient processes for building management. Already, Techem’s solutions avoid around 7 million tons of CO2 per year, according to the company.
Source – GlobalData Market Opportunity Forecasts to 2023: Global IoT

Smart buildings software and services make up a considerable component of the overall IoT market opportunity. Solutions for use cases connected to managing building environments such as climate control, smart lighting, and security systems were worth $7.6 billion globally in 2018. GlobalData forecasts that the market for solutions serving this use case will have a CAGR of 37% over the next five years – faster growth than any other use case – reaching a market size of $30.4 billion in 2023 or about 10% of the total. (The total market size across all IoT use cases was $130 billion in 2018, growing to $318 billion by 2023.)

Looking at actual deployments (or at least those disclosed publicly), approximately 11% of all IoT deployments tracked in GlobalData’s IoT Deployment Database over the last three years are for smart buildings use cases. Of those, only a handful have been by energy utilities, just one of which is developing its own smart building solutions for properties it supplies electricity to. Telcos have also been involved in a few smart buildings projects, but generally for single-customer deployments (or for monitoring their own buildings, such as data centers). The majority of deployments tracked so far, however, have been made by organizations seeking to deploy smart building solutions in their own properties. This DIY approach makes sense for those at the cutting edge, but the larger population of building owners (enterprises and public sector organizations) will seek proven and easy-to-consume solutions, preferably delivered as a service (and particularly if they can be bundled as part of an existing essential service, such as connectivity or energy). We expect that more telcos and utilities will come together to offer such smart solutions in the same way that Q-loud and Techem have this week, sharing the opportunity between them.

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