IoT – Page 5 – Product Management Confabulation

January 13, 2021

Vdoo raises $25M more to develop its AI-based security for IoT and connected devices

It’s estimated that there were some 50 billion connected devices globally in 2020, and while that really says a lot about how far we’ve come in tech, for many it also speaks to a big issue: security vulnerabilities, with the devices themselves, plus all the components and services running on them, all potential targets for anything from malicious hackers to not-so-intentional data leaks.

Today, an Israeli startup Vdoo — which has been developing AI-based services to detect and fix those kinds of vulnerabilities in IoT devices — is announcing $25 million in funding, money that it plans to use to help it better address the wider issue as it applies to all connected objects. With its initial focus on large industrial deployments, medical systems, communications infrastructure and automotive, Vdoo also looking more deeply now at the wider network of devices that use communications chips, providing quick (as in minutes) assessments to identify and remediate or directly fix various issues: it cites zero-day vulnerabilities, CVEs, configuration and hardening issues, and standard incompliances among them.

The funding — an extension to the $32 million round that Vdoo announced in April 2019 — is coming from two investors, Israel’s Qumra Capital and Verizon Ventures (the investing arm of Verizon, which — by way of its acquisition of Aol many years ago — also owns TechCrunch).

Verizon’s interest in Vdoo is strategic and speaks to the opportunity in the market. As CEO Netanel Davidi (who co-founded the company with Uri Alter and Asaf Karas) describes it, operators like Verizon are interested because of their role as a distributer and reseller of hardware as part of their wider services play, be it for broadband access, or a telematics service, or something for the connected home or connected office.

“They sell connected devices to enterprises and home users that are not made by them, yet the carriers are responsible for the security,” he said, “so the solution is to bake that into devices” to make it work more seamlessly, he said.

Verizon is not the startup’s only strategic backer. Others in the first tranche of this round included another carrier, Japan’s NTT Docomo, MS&AD Ventures (the venture arm of the global cyber insurance firm) and Dell Technology Capital, the VC arm of Dell.

The company has now raised around $70 million, and while it’s not disclosing valuation, Davidi confirmed that it has more than doubled this year.

(In April 2019, PitchBook estimated that it was just under $100 million, which would make it now at over $200 million if that figure is accurate.)

Davidi said that the decision to raise this money as an extension to the previous round rather than a new round was strategic: it gave the company the chance to raise funding more quickly, and to take more time to prepare for a bigger funding round in the near future.

And the reason for raising quickly was to address what was a quickly moving target: one of the by-products of the Covid-19 pandemic has been a dramatic shift to people working from home, buying new devices to enable that and in general using their communications networks much more heavily than before.

Connected device security typically focuses on monitoring activity on the hardware, how data is moving in and out of them. Vdoo’s approach has been to build a platform that monitors the behavior of the devices themselves, using AI to compare that behavior to identify when something is not working as it should.

“For any kind of vulnerability, using deep binary analysis capabilities, we try to understand the broader idea, to figure out how a similar vulnerability can emerge,” is how Davidi described the process when we talked about the first part of this round back in 2019.

Vdoo generates specific “tailor-made on-device micro-agents” to continue the detection and repair process, which Davidi likens to a modern approach to some cancer care: preventive measures such as periodic monitoring checks, followed by a “tailored immunotherapy” based on prior analysis of DNA.

Vdoo is a play on the Hebrew word that sounds like “vee-doo” and means “making sure”, and points to the basic idea of how it approaches the verification around its device monitoring. It also feels somewhat like the next step in endpoint security, which was the focus of Davidi and Alter’s previous startup, Cyvera, which was eventually acquired by Palo Alto Networks.

The focus on devices, in some ways, is a significantly more complex approach given that it’s not just about the device, but the many components that go into them. As we have seen with Meltdown and Spectre, vulnerabilities might exist at the processor level.

And as Davidi pointed out to me this week, at times those issues aren’t even intentional but still mean data can leak out, and at worst that can be exploitable by bad actors.

“Backdoors are being built into many devices, and some are not even intentional,” he said. “It may be that the developer wanted to create a shortcut to make something else easier in the future. Some will see that as a back door, and some will not.”

The fractal-like nature of the issue what Vdoo is digging into with its widening approach.

“Initially we wanted to serve the ecosystem of manufacturers, since they are the cause of the problem and the origin of the security issues,” he said. “We started there with Fortune 500 customers in areas like automotive and industrial and medical and telco and aviation. The idea was to make a platform that could serve and product security stakeholders. But then we saw that this was a big unserved market.”

Indeed, Vdoo quotes figures from research firm Markets and Markets that forecast that the global device security market will grow to $36.6 billion by 2025 from $12.5 billion in 2020.

“The number of connected IoT devices is rapidly growing, creating greater opportunities for security breaches,” said Boaz Dinte, Managing Partner of Qumra Capital, in a statement. “Vdoo’s unique device-centric, deep technology automated approach has already brought immediate value to vendors in a very short period of time. We believe the market opportunity is huge, and with newly infused growth capital, Vdoo is well-positioned to become the leading global player for securing connected devices.”

“With the expansion of 5G networks and mobile edge compute, there’s a need for an end-to-end, device-centric security approach to IoT,” added Verizon Ventures MD Tammy Mahn in a statement. “As the venture arm of a leading telco, Verizon Ventures is proud to invest in Vdoo and its world-class team on their journey to solve this global need, while ushering in a new era of security by design in our increasingly connected world.”

December 3, 2020

This is a good time to start a proptech company

Colton Pace Contributor

Colton Pace is an investor at Fika Ventures. He previously held roles investing at Vulcan Capital and Madrona Venture Labs.

Procore

Founded: 2002.
Early traction: Used by celebrity housing projects in California.
Inflection point: 2012 (people start using iPads and smartphones on job sites).
Today: $5 billion valuation as of May 2020.

Procore was founded in 2002 in the aftermath of the dot-com bust, well before widespread WiFi and five years before the iPhone. The company saw the capability for software and technology to transform the construction industry long before practitioners did. Its team faithfully and stubbornly kept at it through the financial crisis, but only had $5 million in revenue by 2012. Here’s where the timing kicks in: At this time, iPads and smartphones had become more common on worksites, enabling widespread adoption.

Realizing this change in-market and adapting to it, Procore strategically priced its product as a subscription, rather than based on headcount, as was typical in the industry. In this way, early customers like Wieland and Mortenson got their subcontractors and temp employees to use the product, which then created a flywheel effect that spread Procore to other projects and clients. Fast forward to today, Procore now has more than $290 million in ARR and is valued over $5 billion.

Procore’s persistence and agility ultimately enabled it to capitalize on the right technological trends and shifts, despite what initially seemed like a poorly timed decision to start a software company in a recession. Procore is now on a venture exit path as it continues to acquire new-age proptech companies like Avata Technologies, Honest Buildings and BIMAnywhere.

Zillow

Founded: 2006.
Early traction: Launched with 1 million website visits.
Inflection point: 2009 (financial crisis mindset).
Today: Public — $27 billion market capitalization.

Zillow was founded by the co-founders of Hotwire and Expedia. While that might not seem relevant, the vision to bring transparency to consumers is the connecting line, the mission being to provide access to siloed data and knowledge to previously convoluted industries. Before Zillow, homeowners did not know how much their house was worth. With Zillow’s Zestimate, consumers can put a price tag on every roof across North America.

October 28, 2020

Microsoft announces its first Azure data center region in Taiwan

After announcing its latest data center region in Austria earlier this month and an expansion of its footprint in Brazil, Microsoft today unveiled its plans to open a new region in Taiwan. This new region will augment its existing presence in East Asia, where the company already runs data centers in China (operated by 21Vianet), Hong Kong, Japan and Korea. This new region will bring Microsoft’s total presence around the world to 66 cloud regions.

Similar to its recent expansion in Brazil, Microsoft also pledged to provide digital skilling for over 200,000 people in Taiwan by 2024 and it is growing its Taiwan Azure Hardware Systems and Infrastructure engineering group, too. That’s in addition to investments in its IoT and AI research efforts in Taiwan and the startup accelerator it runs there.

“Our new investment in Taiwan reflects our faith in its strong heritage of hardware and software integration,” said Jean-Phillippe Courtois, Executive Vice President and President, Microsoft Global Sales, Marketing and Operations. “With Taiwan’s expertise in hardware manufacturing and the new datacenter region, we look forward to greater transformation, advancing what is possible with 5G, AI and IoT capabilities spanning the intelligent cloud and intelligent edge.”

Image Credits: Microsoft

The new region will offer access to the core Microsoft Azure services. Support for Microsoft 365, Dynamics 365 and Power Platform. That’s pretty much Microsoft’s playbook for launching all of its new regions these days. Like virtually all of Microsoft’s new data center region, this one will also offer multiple availability zones.

Microsoft Azure announces its first region in Austria

September 21, 2020

Amazon details its low-bandwidth Sidewalk neighborhood network, coming to Echo and Tile devices soon

Last year, Amazon announced its Sidewalk network, a new low-bandwidth, long-distance wireless protocol it developed to help connect smart devices inside and — maybe even more importantly — outside of your home. Sidewalk, which is somewhat akin to a mesh network that, with the right amount of access points, could easily cover a whole neighborhood, is now getting closer to launch.

As Amazon announced today, compatible Echo devices will become Bluetooth bridges for the Sidewalk network later this year and select Ring Floodlight and Spotlight Cams will also be part of the network. Since these are low-bandwidth connections, Amazon expects that users won’t mind sharing a small fraction of their bandwidth with their neighbors.

In addition, the company also announced that Tile will be the first third-party Sidewalk device to use the network when it launches its compatible tracker in the near future.

When Amazon first announced Sidewalk, it didn’t quite detail how the network would work. That’s also changing today, as the company published a whitepaper about how it will ensure privacy and security on this shared network. To talk about all of that — and Amazon’s overall vision for Sidewalk — I sat down with the general manager of Sidewalk, Manolo Arana.

Image Credits: Amazon

Arana stressed that we shouldn’t look at Sidewalk as a competitor to Thread or other mesh networking protocols. “I want to make sure that you see that Sidewalk is actually not competing with Thread or any of the other mesh networks available,” he said. “And indeed, when you think about applications like ZigBee and Z-Wave, you can connect to Sidewalk the same way.” He noted that the team isn’t trying to replace existing protocols but just wants to create another transport mechanism — and a way to manage the radios that connect the devices.

And to kickstart the network and create enough of a presence to allow homeowners to connect their smart lights at the edge of their properties, for example, what better way for Amazon than to use the Echo family of devices.

Amazon Sidewalk is a new long-range wireless network for your stuff

“Echos are going to serve as bridges, that’s going to be a big thing for us,” Arana said. “You can imagine the number of customers that will benefit from that feature. And for us to be able to have that kind of service, that’s super important. And Tile is going to be the first edge device, the first Sidewalk-enabled device, and they’ll be able to track your valuables, your wallet, whatever it is that you love.”

And in many ways, that’s the promise of Sidewalk. You share a bit of bandwidth with your neighbors and in return, you get the ability to connect to a smart light in your garden that would otherwise be outside of your own network, for example, or get motion sensor alerts even when your home WiFi is out, or to track your lost dog who is wearing a smart pet finder (something Amazon showed off when it first announced Sidewalk).

Image Credits: Amazon

In today’s whitepaper, the team notes that Amazon will make sure that shared bandwidth is capped and provide a simple on/off control for compatible devices to give users the choice to participate. The maximum bandwidth a device can use is capped at 500MB and the bandwidth between a bridge and the Sidewalk server in the cloud won’t exceed 80Kbps.

The overall architecture of the Sidewalk service is pretty straightforward. The endpoint, say a connected garden light, talks to the bridge (or gateway, as Amazon also calls it in its documentation). Those gateways will use Bluetooth Low Energy (BLE), Frequency Shift Keying (FSK) and LoRa in the 900 MHz band connect to the devices on one side — and then talk to the Sidewalk Network server in the cloud on the other.

That network server — which is operated by Amazon — manages incoming packets and ensure that they come from authorized devices and services. The server then talks to the application server, which is either operated by Amazon or a third-party vendor.

Image Credits: Amazon

All these communications are encrypted multiple times and even Amazon won’t be able to know the commands or messages that are being passed through the network. There are three layers of encryption here. First, there’s the application layer that enables the communication between the application server and the endpoint. Then, there’s Sidewalk’s network layer, which protects the packets over the air and in addition, there’s the so-called Flex layer which is added by the gateway and which provides the network server with what Amazon calls “a trusted reference of message-received time and adds an additional layer of packet confidentiality.”

In addition, whatever routing information Amazon receives is purged ever 24 hours and device IDs are regularly rotated to ensure data can’t be tied to individual customers, in addition to using one-way hashing keys and other cryptographic techniques.

Arana stressed that the team decided not to go public with this project until it had gone through extensive penetration tests, for example, and added kill switches and advanced security features. The team also developed novel techniques to provision devices inside the network securely.

He also noted that the silicon vendors who want to enable their products for Sidewalk have to go through an extensive testing procedure.

“When you look at the level of security requirements for the silicon to be part of Sidewalk, many of our silicon [vendors] haven’t been qualified, just because it needs to be the new version, it needs to have certain secure boot features and things. That has been quite an eye-opener for everyone, to see that IoT is definitely improving — and it is going to get to a super level — but there’s a lot of work to do and this is part of it. We took it on and embraced that security level to the maximum and the vendors have been extremely positive and forthcoming working with us.”

Among those vendors the team has been working with are Silicon Labs, Texas Instruments and Nordic Semiconductor.

To test Sidewalk, Amazon partnered with the Red Cross to run a proof of concept implementation to help it track blood collection supplies between its distribution centers and donation sites.

“What we do with this is very simple tracking,” Arana said. “If you think about what they need, it is: did [the supplies] leave the building? Did they arrive at the other building? And it’s just it’s an immense simplification for them in terms of the logistics and creates efficiencies in terms of the distribution of those [supplies].”

This is obviously not so much a consumer use case, but it does show the potential for Sidewalk to also take on more industrial use cases over time. As of now, that’s not necessarily what the team is focusing on, but Arana noted that there are a lot of use cases where Sidewalk may be able to replace cell networks to provide IoT connectivity for sensors and other small edge devices that don’t have large bandwidth requirements — and adding cellular connectivity also makes these devices more expensive to build.

Since Amazon is jumpstarting the network with its Echo and Ring Devices, chances are you’ll hear quite a bit more about Sidewalk in the near future.

September 17, 2020

Perigee infrastructure security solution from former NSA employee moves into public beta

Perigee founder Mollie Breen used to work for NSA where she built a security solution to help protect the agency’s critical infrastructure. She spent the last two years at Harvard Business School talking to Chief Information Security Officers (CISOs) and fine-tuning that idea she started at NSA into a commercial product.

Today, the solution that she built moves into public beta and will compete at TechCrunch Disrupt Battlefield with other startups for $100,000 and the Disrupt Cup.

Perigree helps protect things like heating and cooling systems or elevators that may lack patches or true security, yet are connected to the network in a very real way. It learns what normal behavior looks like from an operations system when it interacts with the network, such as what systems it interacts with and which individual employees tend to access it. It can then determine when something seems awry and stop an anomalous activity before it reaches the network. Without a solution like the one Breen has built, these systems would be vulnerable to attack.

“Perigee is a cloud-based platform that creates a custom firewall for every device on your network,” Breen told TechCrunch. “It learns each device’s unique behavior, the quirks of its operational environment and how it interacts with other devices to prevent malicious and abnormal usage while providing analytics to boost performance.”

Image Credits: Perigee

One of the key aspects of her solution is that it doesn’t require an agent, a small piece of software on the device, to make it work. Breen says this is especially important since that approach doesn’t scale across thousands of devices and can also introduce bugs from the agent itself. What’s more, it can use up precious resources on these devices if they can even support a software agent.

“Our sweet spot is that we can protect those thousands of devices by learning those nuances and we can do that really quickly, scaling up to thousands of devices with our generalized model because we take this agentless-based approach,” she said.

By creating these custom firewalls, her company is able to place security in front of the device preventing a hacker from using it as a vehicle to get on the network.

“One thing that makes us fundamentally different from other companies out there is that we sit in front of all of these devices as a shield,” she said. That essentially stops an attack before it reaches the device.

While Breen acknowledges that her approach can add a small bit of latency, it’s a tradeoff that CISOs have told her they are willing to make to protect these kinds of operational systems from possible attacks. Her system is also providing real-time status updates on how these devices are operating, giving them centralized device visibility. If there are issues found, the software recommends corrective action.

It’s still very early for her company, which Breen founded last year. She has raised an undisclosed amount of pre-seed capital. While Perigee is pre-revenue with just one employee, she is looking to add paying customers and begin growing the company as she moves into a wider public beta.

September 15, 2020

Verkada adds environmental sensors to cloud-based building operations toolkit

As we go deeper into the pandemic, many buildings sit empty or have limited capacity. During times like these having visibility into the state of the building can give building operations peace of mind. Today, Verkada, a startup that helps operations manage buildings via the cloud, announced a new set of environmental sensors to give customers even greater insight into building conditions.

The company had previously developed cloud-based video cameras and access control systems. Verkdada CEO and co-founder of Filip Kaliszan says today’s announcement is about building on these two earlier products.

“What we do today is cameras and access control — cameras, of course provide the eyes and the view into building in spaces, while access control controls how you get in and out of these spaces,” Kaliszan told TechCrunch. Operations teams can manage these devices from the cloud on any device.

The sensor pack that the company is announcing today, layers on a multi-function view into the state of the environment inside a building. “The first product that we’re launching along this environmental sensor line is the SV11, which is a very powerful unit with multiple sensors on board, all of which can be managed in the cloud through our Verkada command platform. The sensors will give customers insight into things like air quality, temperature, humidity, motion and occupancy of the space, as well as the noise level,” he said.

There is a clear strategy behind the company’s product road map. The idea is to give building operations staff a growing picture of what’s going on inside the space. “You can think of all the data being combined with the other aspects of our platform, and then begin delivering a truly integrated building and setting the standard for enterprise building security,” Kaliszan said.

These tools, and the ability to access all the data about a building remotely in the cloud, obviously have even more utility during the pandemic. “I think we’re fortunate that our products can help customers mitigate some of the effects of the pandemic. So we’ve seen a lot of customers use our tools to help them manage through the pandemic, which is great. But when we were originally designing this environmental sensor, the rationale behind it were these core use cases like monitoring server rooms for environmental changes.”

The company, which was founded in 2016, has been doing well. It has 4200 customers and roughly 400 employees. It is still growing and actively hiring and expects to reach 500 by the end of the year. It has raised $138.9 million, the most recent coming January this year, when it raised an $80 million Series C investment led Felicis Ventures on a $1.6 billion valuation.

Verkada raises $80M at $1.6B to be every building’s security OS

August 7, 2020

IoT and data science will boost foodtech in the post-pandemic era

Sunny Dhillon Contributor

Sunny Dhillon is an early-stage investor at Signia Ventures in San Francisco where he invests in retail tech, e-commerce infrastructure and logistics, alongside consumer and enterprise software startups.

Rely on the data

Image Credits: Pixabay/Pexels (opens in a new window)

The hallmark of shopping in a store is the consistent availability and wide selection of fresh items — often more so than online. But as the number of in-store customers continues to fluctuate, planning inventory and minimizing waste has become ever more so a challenge for grocery store managers. Grocers on average throw out more than 12% of their on-shelf produce, which eats into already razor-thin margins.

While e-grocers are automating and optimizing their fulfillment operations, brick-and-mortar grocers can automate and optimize their inventory planning mechanisms. To do this, they must leverage their existing troves of customer, business and external data to glean valuable insights for store managers.

Eden Technologies of Walmart is a pioneering example. Spun out of a company hackathon project, the internal tool has been deployed at over 43 distribution centers nationwide and promises to save Walmart over $2 billion in the coming years. For instance, if a batch of produce intended for a store hundreds of miles away is deemed soon-to-ripen, the tool can help divert it to the nearest store instead, using FDA standards and over 1 million images to drive its analysis.

From farm to phone: A paradigm shift in grocery

Similarly, ventures such as Afresh Technologies and Shelf Engine have built platforms to leverage years of historical customer and sales data, as well as seasonality and other external factors, to help store managers determine how much to order and when. The results have been nothing but positive — Shelf Engine customers have increased gross margins by over 25% and Afresh customers have reduced food waste by up to 45%.

July 31, 2020

Cisco acquires Modcam to make Meraki smart camera portfolio even smarter

As the Internet of Things, proliferates, security cameras are getting smarter. Today, these devices have machine learning capability that help the camera automatically identify what it’s looking at — for instance an animal or a human intruder? Today, Cisco announced that it’s acquired Swedish startup Modcam and making it part of its Meraki smart camera portfolio with the goal of incorporating Modcam computer vision technology into its portfolio.

The companies did not reveal the purchase price, but Cisco tells us that the acquisition has closed.

In a blog post announcing the deal, Cisco Meraki’s Chris Stori says Modcam is going to up Meraki’s machine learning game, while giving it some key engineering talent, as well.

“In acquiring Modcam, Cisco is investing in a team of highly talented engineers who bring a wealth of expertise in machine learning, computer vision and cloud-managed cameras. Modcam has developed a solution that enables cameras to become even smarter,” he wrote.

What he means is that today, while Meraki has smart cameras that include motion detection and machine learning capabilities, this is limited to single camera operation. What Modcam brings is the added ability to gather information and apply machine learning across multiple cameras, greatly enhancing the camera’s capabilities.

“With Modcam’s technology, this micro-level information can be stitched together, enabling multiple cameras to provide a macro-level view of the real world,” Stori wrote. In practice, as an example, that could provide a more complete view of space availability for facilities management teams, an especially important scenario as businesses try to find safer ways to open during the pandemic. The other scenario Modcam was selling was giving a more complete picture of what was happening on the factory floor.

All of Modcams employees, which Cisco described only as “a small team” have joined Cisco, and the Modcam technology will be folded into the Meraki product line, and will no longer be offered as a stand-alone product, a Cisco spokesperson told TechCrunch.

Modcam was founded in 2013 and has raised $7.6 million, according to Crunchbase data. Cisco acquired Meraki back in 2012 for $1.2 billion.

Cisco Acquires Enterprise Wi-Fi Startup Meraki For $1.2 Billion In Cash

July 16, 2020

EU antitrust lawmakers kick off IoT deep dive to follow the data flows

The potential for the Internet of Things to lead to distortion in market competition is troubling European Union lawmakers who have today kicked off a sectoral inquiry.

They’re aiming to gather data from hundreds of companies operating in the smart home and connected device space — via some 400 questionnaires, sent to companies big and small across Europe, Asia and the US — using the intel gleaned to feed a public consultation slated for early next year when the Commission will also publish a preliminary report.

In a statement on the launch of the sectoral inquiry today, the European Union’s competition commissioner, Margrethe Vestager, said the risks to competition and open markets linked to the data collection capabilities of connected devices and voice assistants are clear. The aim of the exercise is therefore to get ahead of any data-fuelled competition risks in the space before they lead to irreversible market distortion.

“One of the key issues here is data. Voice assistants and smart devices can collect a vast amount of data about our habits. And there’s a risk that big companies could misuse the data collected through such devices, to cement their position in the market against the challenges of competition. They might even use their knowledge of how we access other services to enter the market for those services and take it over,” said Vestager.

“We have seen this type of conduct before. This is not new. So we know there’s a risk that some of these players could become gatekeepers of the Internet of Things, with the power to make or break other companies. And these gatekeepers might use that power to harm competition, to the detriment of consumers.”

The Commission recently opened up a consultation on whether regulators needs new powers to address competition risks in digital markets, including being able to intervene when they suspect digital market tipping.

It is also asking for views on how to shape regulations around platform governance.

The IoT sectorial enquiry adds another plank to its approach towards reformulating digital regulation in the data age. (Notably competition chief Vestager is simultaneously the Commission EVP in charge of pan-EU digital strategy.)

On the IoT front, risks Vestager said she’s concerned about include what she couched as familiar antitrust behaviour such as “self-preferencing” — i.e. a company directing users towards its own products or services — as well as companies inking exclusive deals to send users “preferred” provider, thereby locking out more open competition.

“Whether that’s for a new set of batteries for your remote control or for your evening takeaway. In either case, the result can be less choice for users, less opportunity for others to compete, and less innovation,” she suggested.

“The trouble is that competition in digital markets can be fragile,” Vestager added. “When big companies abuse their power, they can very quickly push markets beyond the tipping point, where competition turns to monopoly. We’ve seen that happen before. If we don’t act in good time, there’s a serious risk that it will happen again, with the Internet of Things.”

The commissioner’s remarks suggest EU lawmakers could be considering regulations that aim to enforce interoperability between smart devices and platforms — although Vestager also said they will be asking about any barriers to achieving such cross-working.

“For us to get the most out of the Internet of Things, our smart devices need to communicate. So if the devices from different companies don’t work together, then consumers may be locked in to just one provider. And be limited to what that provider has to offer,” she said.

“We’re asking about the products they sell, and how the markets for those products work. We’re asking about data – how it’s collected, how it’s used, and how companies make money from the data they collect. And we’re asking about how these products and services work together, and about possible problems with making them interoperable.”

Vestager has raised concerns about the potential for voice assistant technology to lead to market concentration and distortion before — saying last year that they present an acute challenge to regulators who she said then were “trying to figure out how access to data will change the marketplace”.

The question of how access to digital data feeds platform monopolies has been a long standing preoccupation for the now second term competition chief. Although the Commission’s work on figuring out how data access changes marketplace function remains something of a work in progress.

Vestager has an open investigation into Amazon’s use of third party data on her plate, for example. It also inked a first set of rules on ecommerce platform fairness last year. More rules may be incoming in a draft proposal for reformulating wider liability rules for platforms that’s slated to land by the end of this year, aka the forthcoming Digital Services Act.

The Commission noted today that a prior sector inquiry — into ecommerce markets — helped shape new rules against “unjustified geoblocking” in the EU, although it has not yet been able to dismantle geoblocking barriers to accessing digital services across the Single Market’s internal borders.

Last year privacy concerns raised in Europe around how tech giants operate voice assistant ‘quality grading’ programs, which involved human contractors listening in to users’ recordings, led to a number of changes — including the previously non-transparent programs being publicly disclosed, and choice/controls being provided to users.

Apple suspends Siri response grading in response to privacy concerns

July 9, 2020

Twilio acquires Electric Imp to bolster its growing IoT business

While you may mostly think about Twilio in the context of its voice and text messaging platform, the company has recently made a number of moves to bolster its IoT platform, which is already one of its fastest-growing business units. To accelerate this push, the company today announced that it quietly acquired IoT platform Electric Imp a few months ago.

Before the acquisition, Electric Imp, which was one of the earlier IoT startups, had raised about $44 million from firms like Ramparts Capital, which led its 2016 Series C round, with participation from Redpoint, Foxconn, Lowercase Capital and PTI Ventures. The two companies did not disclose the price of the acquisition.

Electric Imp makes it easier for businesses to securely connect their IoT devices with their data centers and third-party services. The company was co-founded by Hugo Fiennes, who was the engineering manager for the hardware team at Apple that launched the first iPhone. After managing four phone launches at Apple, he briefly went to Google to work on IoT projects there, but quickly realized that Google had already built the idea he wanted to work on in the company with Android for Things. He also turned down a job at Nest — though he did the design and architecture of their first thermostat, too. His, interest, and that of his co-founders (which include Gmail designer Kevin Fox, who left the company in 2013, and software architect Peter Hartley), was elsewhere, though.

Electric Imp Raises $7.9M From Redpoint & Lowercase Capital To Power The Internet of Things

“My worry for IoT was, I didn’t want to be spending many years building something which was just going to be a thermostat,” he said. “Not that a thermostat is not an important thing — it does save lots of energy — but it was more like, ‘oh my God, this technology — IoT, connecting a business service to the real world — allows you to optimize the real world.”

So the idea behind Electric Imp was to build a flexible, architecture-agnostic platform that would take care of all the plumbing to build an IoT system and then manage its life cycle throughout the years. Most businesses struggle with things like updates and, related to that, security, Fiennes argues. That’s what Electric Imp aims to essentially abstract away for its customers.

Image Credits: Twilio

“We always wanted it to be really accessible,” Fiennes said. “We don’t know all the applications. It’s not like ‘this is gonna be for us to tracking, let’s just chase asset tracking.’ If we know it’s for general purpose, has to be available to anyone, they just buy a dev kit and sign up, whatever, just try it. And a lot of our marketing, for better or for worse, was really just, ‘hey, it’s a great product, right?’ ”

As Fiennes noted, in that respect Electric Imp wasn’t that different from Twilio — and the company actually used Twilio when it demoed its product to potential Series A investors.

Twilio CEO and co-founder Jeff Lawson also noted that the IoT space hasn’t been innovating at the pace of software. “It’s been fun watching Twilio customers invent new connected experiences like shared scooters, and wearables that enable kids to communicate with their parents,” he said. “It reminds me of the explosion of customer engagement use cases Twilio customers invented using our Programmable Voice and SMS APIs. But overall, the IoT industry doesn’t seem to attract innovation at the same rate as software. One possible reason is that experimentation — real experimentation — that is, testing real business models in the wild — remains difficult. By democratizing access to cellular IoT connectivity, we’ve been able to help move things along, but many of the hardest infrastructure problems remain unsolved. With the Electric Imp acquisition, we gain the team and technology needed to make a bigger dent in the problems facing future IoT developers.”

Image Credits: Electric Imp

It’s worth noting that Electric Imp isn’t meant to be a platform for high-bandwidth use cases, like streaming video, but more for connecting sensors that produce a more manageable amount of data to the cloud. One of Electric Imp’s customers is Pitney Bowes, which makes postage meters, but you can also think smart grids, river-level monitoring etc. And while Electric Imp’s technology can also be found in smart devices for consumers, Fiennes believes that the real value of the platform isn’t necessary in high-volume products.

“I think it’s kind of like, a lot of those [consumer use cases are] are just like, ‘you can connect it, yes. But why?’ But there’s really a lot of things like, river-level monitoring and a whole load of things which are very hard to deal with without IoT. And they’re not necessarily hugely high volume, which is why a repeatable platform that can be sold to many customers without change is really important because you get to target the niches where there’s a lot of value.”

With this acquisition, Twilio is not just buying a product but also a lot of expertise in building an IoT infrastructure. While the company doesn’t disclose the size of its IoT team, Twilio’s Evan Cummack, the GM of Twilio IT, and Chetan Chaudhary, the VP of Sales for IoT, who together founded the IoT business unit, tell me that a lot of early Twilio employees now work on the IoT side, including Twilio’s very first architect and the company’s first sales rep.

Cummack and Chaudhary told me that after a few years of working at Twilio, the realized there was a lot of untapped potential in IoT for the company.

In the early days of Twilio, both worked on building out Twilio’s strategy for selling to enterprise companies — and to some degree, they are now aiming to use a similar playbook to build out Twilio’s IoT business, though the idea is actually quite a bit older and pre-dates Twilio’s 2016 IPO.

“What I realized was that it was the combination of a really strong go to market with the technical prowess that allowed us to get to the early big wins [for Twilio],” Chaudhary said. “And we had this idea around doing the same thing for cellular connectivity for IoT devices because we were already buying wholesale voice and messaging. And I got to work with some of our carrier relations folks and helping them close some of the connectivity deals. And I was like: ‘Why can’t we sell SIM cards?’ ”

Twilio launched its IoT business in partnership with T-Mobile in 2016. The first product was its programmable wireless service. It then acquired Berlin’s Core Network Dynamics in 2018 to solve another set of problems that IoT developers were facing around connecting their IoT devices.

“What we saw once we started playing in connectivity was that there’s still just a tremendous amount of plumbing that’s not solved for,” Cummack noted. “So you have a tremendous amount of customers having to build their own security stacks, over-the-air update capabilities, secure boot, manufacturing tools, testing, manufacturer, even just things like getting connected to wireless networks, cellular networks and Wi-Fi networks was way too high. And all of this stuff is what I would consider to be platform stuff. It’s all kind of plumbing.”

In its early days Twilio though of the IoT group as a bit of a startup within the company. But that seems to be changing. “Twilio IoT evolved from an internal experiment into a fully fledged business unit with a thriving connectivity business,” Lawson told me. “It has the potential to evolve again into a market-leading platform for the emerging IoT developer community.”

Twilio has already integrated a lot of Electric Imp’s services into its go-to-market strategy, Chaudhary noted. “They’ve already brought […] a lot of credibility in a couple of deals because of their DNA and because of the things that they were able to solve, especially around the embedded design and hardware design, we were able to see some really good synergies early on and now we’ll start to see some net new customers, I think, come from it.”

Fiennes will continue at Twilio as a Senior Product Architect, working on IoT and Electric Imp is actually releasing its newest product today: the imp006 breakout board for prototyping IoT products, which — no surprise there — comes with Twilio’s Super SIM for global connectivity already pre-installed.