The Secret of the IoT Platform, According to Daliworks
“Do you know what this device is?” asked Daliworks CEO Soonho Lee, pointing to an object that looked like a small desk clock. “It looks like a speaker, right? It is actually a product that measures indoor air quality. Products like this get connected, and the data keeps accumulating. With that data you can see not only the air condition of the office but also how people are behaving. This is what a connected device is. Things like this create new value and, in the end, change the world.” Asked what he thinks of digital transformation, Lee stressed the importance of being ‘connected.’ His creed is that connection changes the world.
Daliworks Is an IoT Platform Company.
Simply put, its cloud platform lets customers build IoT services quickly and easily. This helps enterprises with their digital transformation. On July 19, we met Daliworks CEO Soonho Lee. With partnerships with overseas giants such as ARM and Qualcomm, Daliworks is vigorously active abroad. We were lucky to catch Lee, who spends more than half of every month overseas. From him we heard about the state of digital transformation, the role of the IoT platform in digital transformation, and Daliworks’ business strategy as a platform.
The interview follows in question-and-answer form.
Q. We understand that Daliworks supports enterprises’ digital transformation through its IoT platform. What do you think digital transformation is?
A. Everyone thinks of digital transformation differently, but for me, connection is what matters. Japan, for example, has invested heavily in robots for a long time, so it naturally has a strong interest in automation. But I do not consider it digital transformation just because robots are deployed in a factory doing simple tasks — that has been around for ages. My lens is connection. If connection is part of it, then I call it digital transformation.
Daliworks CEO Soonho Lee
Q. Why is connection so important?
A. When products become smart and connected to one another, the existing rules of competition change. This is not just my opinion — it is what Harvard professor Michael E. Porter said in the Harvard Business Review. From an IoT perspective, once you connect devices you can collect and analyze data on that foundation. Controlling products based on the analyzed data then follows naturally. Ultimately, the system optimizes itself without human intervention.
Daliworks built a Thing+-based IoT platform test bed on the sixth floor of S University Hospital in Bundang, providing smart hospital monitoring and control services. <Source: Daliworks>
Q. For example?
A. Take the hospital where Daliworks actually deployed IoT. Until now, hospitals have been consultation-based, providing service when the patient shows up. But once IoT is in place, data can be collected wherever the patient is. The hospital can also manage its equipment and environment in real time and keep them in optimal condition. In ophthalmic surgery, the most important factor is actually humidity — and when things are connected, humidity can be kept constant and controlled. That can be systematized and stabilized. IoT contributes greatly to making hospitals safe.
Q. How far along is digital transformation in Korea today?
A. Korea adopts technology quickly, and IoT services especially so — led by the large conglomerates. Korea’s large companies are trying to change their existing business frames. Carriers like KT and SKT sense that a business centered on communications alone will not carry them forward, so they want to change something. Asking themselves ‘What do we do for that?’ is how they arrived at digital transformation. Samsung Electronics, too, is always asking ‘After semiconductors, LCDs, and phones — what next?’ It is hard to find the answer in manufacturing alone, so they think all the way to IoT, big data, and AI. Samsung does not want to simply sell appliances; it wants to differentiate and deliver value of its own. Seen from that angle, Korean companies attempt a great deal. Of course, this story applies to the large companies.
A Thing+-based smart factory <Source: Daliworks>
Q. If it is limited to large companies, does that mean digital transformation has not reached small and mid-sized companies? What is the situation for Korean SMEs?
A. Judged by smart factories, conditions at small and mid-sized companies are quite poor. Subcontractors and small plants inevitably hold back on equipment investment to keep production costs down. But the truth is, digital transformation does not work if only the large companies change. Suppose a car has a defect and a recall is needed. In a systematized environment, you can recall only the products made on the same line at the time, based on accurate data, and cut costs dramatically. But if outsourcing partners and subcontractors have no such systems, the root cause cannot be traced — and when a recall has to be sweeping, the costs are enormous. Hyundai Motor is now working to adopt systems that extend connection all the way to its suppliers’ production lines.
Q. It seems time to talk about Daliworks itself. IoT platforms may feel unfamiliar to many people. What kind of platform is Thingplus?
A. Simply put, Thingplus is the underlying platform for building IoT services well. We provide a range of APIs, and with them customers can build IoT services quickly and easily. Thingplus applies everywhere from homes to offices, farms, factories, and industrial facilities of every kind.
Take smart farms: people who know farming and have real insight into it want to build IoT services, but they wrestle with questions like ‘What do I do about hardware?’, ‘How do I visualize the data?’, ‘How do I handle control?’ We provide the platform that answers those questions.
The same goes for smart factories. People with different ideas about their services can all use our platform. Charging a reasonable fee for this is the Daliworks business model. We, too, run a platform business model — revenue grows as customers use more.
Q. So customers do the customizing themselves, and you provide only the platform?
A. That is right. In the early days, though, customers often do not know how to shape the business. So we build a few reference models. Sometimes customers come to us proposing to build a service together with Daliworks. In those cases we form a partnership with the customer and build the application jointly — at times even handling management for the customer.
Q. ‘Participation’ seems important here as well.
A. Yes. One of the most important things is gathering developers. Because we value developers, we keep a dedicated engineering team to support them. Our platform carries a wide range of open source, so developers can try all kinds of things. Many of them are university students.
Around 5,000 people are actively working on our platform today — about 1,500 come from overseas and 3,000 are Korean developers.
Q. Do you have ways of drawing participation?
A. We provide the platform free of charge to universities and public institutions. University students in particular often use Thingplus during school and then build businesses on our platform, or come back after getting jobs to propose partnerships.
Beyond that, our work comes down to two things: promotion through exhibitions, and hosting conferences. We hold conferences ourselves, but we also co-host them with related communities such as Raspberry Pi user groups.
Q. Who are Daliworks’ competitors?
A. In Korea there is no business like ours. There are companies that build IoT services as one-off projects on request, or that focus on one specific area, such as power monitoring, and offer cloud services. But their business models differ from ours: we provide a platform across all industries.
Overseas, on the other hand, there are a few with business models similar to ours — ThingWorx being the most prominent. When we first founded the company, around ten foreign companies were competitors, mostly in North America and Europe. Daliworks’ goal now is to be the best in Southeast Asia and in Korea, China, and Japan.
Q. Daliworks holds partnerships with many overseas companies. Do you have to seek out each one individually? Is there a strategy unique to Daliworks?
A. We attend overseas exhibitions and events actively, but with a strategy a little different from other Korean companies. Among Korean companies, only two — Samsung and Hyundai — carry real name recognition abroad. So for everyone else, partnerships with global companies are extremely important. Take MWC, which we attend every year: we used to exhibit inside the Korea pavilion. One year we built a joint booth with Libelium, the well-known Spanish IoT hardware company, and it introduced Daliworks to far more overseas companies. There is also the LoRa Alliance, where players serving hardware, networks, and platforms gather. Exhibiting together with them multiplies the promotional effect. Going together with related companies is our basic strategy.
Q. You have also partnered with ARM.
A. ARM means a great deal to us. ARM’s Mbed and its ecosystem matter to us. IoT devices are, frankly, very vulnerable on security, and ARM’s Mbed offers a near-perfect security solution. That frees us from worrying about devices and connectivity — what we do is the back end. It is the same from ARM’s perspective; we create synergy for each other. On top of that, the ecosystem ARM is building is considerable. ARM has roughly 200,000 developers, and our strategy is to draw them toward us. In other words, the strategy is to keep adding hardware partnerships. That is how a platform gets known effectively.
Daliworks’ partners <Source: Daliworks>
Throughout the interview, Lee stressed the importance of ‘participation’ and ‘connection.’ In short, participation with diverse hardware and IoT service companies matters to Daliworks — but so does the participation and connection of actual customers (and developers).
“An IoT business needs many things — networks, platforms, devices. But no company does all of it. Companies that each excel at their part have to come together to do business,” Lee said. “In the end, what matters is building an ecosystem around Thingplus and growing it.” He shared his plan to keep forging partnerships with global companies and to make Daliworks even better known abroad.
by IoT journal Asia, reporter Eunju Shin
