Summary Bullets:

• The Optus and Lendlease collaboration on smart spaces has the potential to offer innovative building automation solutions leveraging 5G connectivity, IoT, and AI analytics.

• There is strong competition in the Australian market for smart spaces as other competitors from telco to operational tech providers offer solutions that play to their strengths.

Optus has capped off a week of customers wins with the announcement that it is entering into a partnership with Lendlease that will see the Australian property and construction giant become a customer as well as a collaborator on future solutions. Lendlease is the latest deal, which follows Optus wins with Super Retail Group for a 5G fixed wireless access (FWA) solution and CouriersPlease for a broader range of IT services including SD-WAN, mobile, WiFi, and telephony. While Lendlease also represents a large customer win, as the company will move over 3,000 fixed data and mobile services to Optus across 80 locations, the deal also includes a joint venture that will see Optus and Lendlease collaborate on the development of smart building/smart spaces solutions. Lendlease will bring its ‘Podium Property Insights’ (PPI) platform, a sensor and software platform aimed at delivering insights analysis for property managers, while Optus will offer networking connectivity and IoT expertise.

The partnership offers Optus an opportunity to expand its capabilities in serving the retail and property markets. Optus has already been active in pursuing the property vertical. The company’s proposition includes offering in-building wireless connectivity, including 5G, to complement or replace existing fixed networking systems as enterprise and retail customers leverage more wireless devices and property managers look to leverage IoT to enable smart building use cases like connected HVAC, lifts, lighting, and more. Optus has developed solutions for property industry including connectivity, IoT management, digital signage, and people tracking. Meanwhile Lendlease’s PPI embeds sensors across commercial properties to collect data across 25 categories of metrics that are collected and used to develop analytics dashboards and predictive models used to manage occupancy, environmental controls, develop AR/VR applications, and help work toward autonomous buildings. Optus joins Accenture (contributing IT consulting), Google Cloud Platform (offering cloud services and AI training), ThoughtWire (a digital twin focused company), and the Digital Twin Consortium as Lendlease PPI partners. The combination of Optus’ connectivity and IoT expertise paired with the capabilities of PPI could provide a more end-to-end offering for smart buildings that incorporate physical networking solutions, IoT sensor management, data collection and modeling, and visualization and management software. Beyond the technology capabilities, the partnership will offer Optus improved access to Lendlease portfolio of properties and an inside track to securing deals in the property and retail industry. Lendlease has $6.4 billion in assets directly under management in Australia alone, and its Australian construction business is on track for $6 billion.

However, Optus and Lendlease will face challenges ahead. Even in the media release, the companies stated that the joint-venture based on PPI is in very early stages. Often technology partnerships fail to lead toward commercial products or widespread customer adoption. Lendlease only launched the PPI platform in Asia-Pacific in Q4 2022 and has limited customer references. Further, there are existing competitors in the market aiming to grow in the smart building platform space. Telstra has been pursuing the smart spaces market for years, formally launching a portfolio of products in 2020. Telstra offers asset tracking and management, both cybersecurity and physical security though Sapio, data, and analytics services through the Telstra IoT hub and Telstra Purple as well as recently launched a joint venture with Quantium to develop AI-based IT solutions leveraging 5G and IoT. Telstra is the leader in Australian IoT and can provide a longer list of references. Further, building technology vendors like Schneider and Honeywell have well-established building management systems that increasingly are leveraging IoT, cloud, and analytics and can offer more native integration with physical building systems. The Optus Lendlease tie-up has potential to differentiate, but it will face stiff competition.