Key Elements and Enablers for Developing a Digital Ecosystem for the IoT

Communities, in particular developer communities, give rise to the ecosystem and are a key force for driving the network effects.

The platform is a critical building block; the enabler upon which ecosystem partners build their services. The crucial aspect here is quality, in the form of high availability and reliability, integration capabilities and security.

Market expectation is related to how prospective users perceive the ecosystem in terms of its potential to become a leading one. Of course, neither users nor ecosystem partners want to commit to an ecosystem that might not exist in a couple of years’ time.

Network effects is concerned with the self-perpetuating cycle of user and partner recruitment. More partners and applications on the platform attract more users; at the same time, more users attract more partners. 

However, the question is how to shape these three elements. For this, service providers can focus on a specific set of enablers as described below.

Key enablers of digital ecosystems


APIs, or application programming interfaces, are the critical technical enabler of digital ecosystems that need to form part of an ecosystem strategy. APIs are essentially what powers the exchange of data services between a platform and partner systems. Service providers must pay great attention to this component. Indeed, they must treat them as products, with their own strategy, roadmap, marketing, and support.

APIs can foster – or discourage – network effects. If using an organization’s APIs is too onerous or does not create sufficient value, ecosystem partners will be reluctant to invest time or effort. Similarly, if APIs are not based on standards, it will be more difficult to drive adoption. It is therefore vital that operators design APIs with partner needs in mind – just like they do when creating end-user services. 

Own-brand services

The launch of own-brand services is another essential driver of ecosystem development. It helps develop market expectation by signalling commitment. It shows the company is serious about it and is ready to “put money where their mouth is”. However, the real power of own-brand services is that they create a customer base that can help kick-start the ecosystem. One way to visualize this is to look at how the video games industry relies on a handful of branded games (think Call of Duty or Mario Cart) to drive user adoption – this helps attract developers to the platform which in turn brings even more users in. 

Here the key challenge for service providers is to define the right service that can become a “killer app”, but also how to develop it when the right resources and skills might not be available internally. Here is where the developer community could come in handy. 


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