The Shortest Path from Possibility to Production

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1 MultiConnect OCG Open Communications Gateways The Shortest Path from Possibility to Production 40 years and 20 million devices, Multi-Tech is a world leader in providing complete M2M Solutions

2 Developer Communities Developer communities are a great resource to learn more about enabling M2M communications. To help foster custom application development, Multi-Tech hosts a developer community at where developers can explore application notes and collaborate with other developers and Multi-Tech hardware and software engineers. Enabling Cellular Connectivity There are hundreds of organizations with existing or planned applications that would significantly benefit from cellular machine-to-machine (M2M) connectivity for remote data collection. Industries such as mobile healthcare, remote monitoring, security, fleet management and point-of-sale have demonstrated that cellular data communication is a highly effective solution, once deployed. Many organizations such as these are planning to introduce new applications and want to ensure fast, reliable connections capable of transporting critical data. Others may have applications using declining forms of connectivity that are becoming more challenging to maintain. There may also be legacy applications in the field that require manual data collection, constraining resources and creating operational inefficiencies. Whatever the need, certain barriers to employing wireless M2M technologies have historically prevented many but the largest organizations from realizing its benefits. One challenge every company must overcome in bringing a wireless M2M solution to market is integrating their application with a module or modem to enable data transport over a cellular network. Often several pieces of hardware are utilized to provide an adequate solution, increasing both its cost and complexity. The traditional model for custom M2M solution development may exceed $150,000 in costs and take over 18 months to introduce. Today, an organization has several paths to choose from to enable cellular connectivity for their application: build a custom solution buy an existing embedded solution buy an existing device solution The decision is critical, as the chosen path can greatly impact the organization s cost structure, ROI model and timeframe required to bring the application to market. Each methodology has benefits and drawbacks, and a holistic assessment of the organization s business goals and capabilities should deliver the most relevant path for the organization. 2 9/11 Copyright 2011 by Multi-Tech Systems, Inc. All rights reserved.

3 Considerations for Organizational Assessment Organizations are built around different core competencies and may be seeking cellular connectivity for very different reasons. To select a path forward, it may be helpful to consider the following: What are the core competencies of the organization? (ie: quality manufacturing, software development, engineering innovation, brand leadership or other) Does the organization have sufficient internal hardware and/or software engineering expertise to build a custom application? Is the application for internal use or a solution to be sold to others? (May impact urgency of ROI) What level of flexibility (environment, peripherals, etc.) does the application require? How many carriers will be required to support the application? Has the organization successfully received carrier approvals for an application in the past? Does the organization have a resource for, or experience in, obtaining necessary safety and regulatory certifications? Is the application a new commercial venture or the upgrading of legacy assets? What is the expected unit volume? (Less than 500, over 5,000, more than 10,000?) Does the organization possess manufacturing capabilities or does it use contract manufacturing? Are there maintenance or personnel cost savings that could further improve the total cost of ownership? What is the roadmap for the application over time? Considering a mobile phone platform for cellular connectivity? Physio-Control, a division of Medtronic, recently moved away from using mobile phones to enable data communication from their LIFEPAK external defibrillators to their LIFENET data platform. When we first launched, EMTs used cell phones to transport data to the LIFENET. The medical field puts a lot of emphasis on the field data to determine the quality of care being provided, so reliability and durability are critically important. We use the open communications gateway from Multi-Tech to stay equipped with the latest wireless technologies because in these situations, moments matter, commented Randy Merry, Vice President Business Development and Product Realization. To learn more, read the full article at Are there limitations to the organization s access to investment capital? What is the risk tolerance for the organization? While not intended to be a complete list, asking and answering questions such as these regarding the application and overall organizational competencies may help determine which option is best suited to enable a cellular M2M application. 9/11 Copyright 2011 by Multi-Tech Systems, Inc. All rights reserved. 3

4 Cost vs. Flexibility There are a variety of costs involved in the development of a cellular M2M application. Often in an effort to minimize the bill of materials (BOM) costs, an organization will look to build a custom solution. However, any changes to the application require new carrier approvals and may limit the flexibility of the application and ultimately the return on investment. Considering the total cost of ownership, weighed against the application s need for flexibility over time, may help drive the final hardware development choice. Choosing a path As previously mentioned, each path offers advantages and disadvantages. By conducting an organizational assessment, one of the following scenarios may seem a better fit than the others: Internal Custom Development In order to obtain the most relevant solution, an organization may seek to develop a custom hardware and software application. This approach often results in a highly tailored application and yields a high degree of control in the development process and potentially the lowest bill of materials cost. However, it also demands the most significant investment of time, financial and human resources. Building a custom solution also requires a sufficient level of expertise in all the areas required to bring the application to market (either internal or outsourced), as any missteps in the development process will drive up the total investment and further delay revenue realization. A company building a custom solution requiring M2M communication would typically source a wireless module and other key components to be integrated into a proprietary board design. Interoperability with the module generally requires a custom software application developed in the proprietary language of the module provider. Once developed, carrier approval must be obtained for each end-application variation from every carrier needed to support operations. In order to amortize the heavy development investment and remain price competitive, this approach is most attractive for manufacturing-based organizations developing solutions with few carrier requirements and high volume targets. 4 9/11 Copyright 2011 by Multi-Tech Systems, Inc. All rights reserved.

5 Buy an Existing Embedded Solution Sourcing an existing embedded solution for M2M communications can help reduce overall development costs and lead time, while enabling the organization to focus more on its core competencies. The key advantage to buying an existing cellular solution is that the carrier approvals have already been obtained by the manufacturer. Depending on the breadth of carriers required these savings can be significant. If the existing solution already has software processing capabilities on board, this option may be highly advantageous for legacy applications requiring cellular connectivity. The solution requires the investment and lead time for software and hardware design, as well as additional investment to obtain safety and compliance certifications. Again, amortization of the development costs would require higher volume targets to ensure that the application s overall cost structure remains competitive in the marketplace. Revenue Realization Just like venture capitalists, business owners and executives understand that cash is king the timeframe associated with the realization of revenue from an application often significantly impacts the decision of whether or not to approve a product concept for development. Buy an Existing Device Solution Established manufacturers of cellular communication devices have expertise in most, if not all, of the key areas required to bring an application to market. Their hardware engineers have a deep understanding of the design requirements and standards needed to meet carrier approvals, while staff software engineers are well versed in cellular communication enablement. These manufacturers possess efficient testing, carrier approval and certification procedures to minimize development lead time and the risk of rework. Further, they have existing production and logistics capabilities that may provide significant value to companies requiring external production capabilities. Buying an established device solution may prove ideal for new entrants or those with legacy applications requiring cellular M2M communications. New cellular devices recently introduced offer enhanced features such as on-board processing and memory, as well as a variety of interfaces to accommodate a wide range of sensors and peripherals. By eliminating the need for additional hardware development, carrier approvals and regulatory certifications, many of the previous barriers to entry have been overcome. Today, with a software application and the right partner, an organization of any size can realize the benefits of data transportation over the cellular network. 9/11 Copyright 2011 by Multi-Tech Systems, Inc. All rights reserved. 5

6 From Possibility to Production Dr. Max Donath, Professor of Mechanical Engineering and Director of the Intelligent Transportation Systems Institute at the University of Minnesota, successfully demonstrated his application s proof-of-concept using the MultiConnect OCG. Having a proven platform that is already developed and tested certainly shortens the path to a commerciallyviable deployment solution, remarked Dr. Donath. To learn more, read the full article at The Shortest Path: Open Communications Gateways Of all the options available in the market today, the MultiConnect OCG open communications gateway from Multi-Tech Systems offers the shortest path to cellular M2M connectivity for business applications. The MultiConnect OCG combines an OpenEmbedded Linux environment, as well as on-board processing and memory, with industry-leading wireless technology to offer a complete, application-ready hardware solution capable of machine control and data transportation over the cellular network. By providing a single platform for development and deployment, the MultiConnect OCG simplifies the process of taking an application from possibility to production. Fully certified and carrier approved, small-to-medium sized businesses or larger organizations with niche applications can realize dramatically lower development costs, resulting in improved total cost of ownership. As an end-device, the MultiConnect OCG can modify the use or extend the product life of previously deployed equipment, enhancing the return on investment of existing assets. Comparison: The shortest path Device MultiConnect OCG-D Software Development Timeline (in months) $25,000 ROI Begins Embedded Component MultiConnect OCG-E Hardware Engineering Software Development EMC & Safety Internal Custom Development Hardware Engineering Software Development EMC & Safety Certifications $50,000 $25,000 $8,000 ROI Begins Total Cost: $25,000 Total Cost: $83,000 $100,000 $50,000 $8,000 $35,000 Total Cost: $193,000 Starting with an existing PC-based application and no device hardware, the overall project cost and time to market greatly improve when leveraging Multi-Tech solutions, providing faster return-on-investment. ROI Begins 6 9/11 Copyright 2011 by Multi-Tech Systems, Inc. All rights reserved.

7 MultiConnect OCG Open Communications Gateways The MultiConnect OCG Open Communications Gateways are available in two versions. Understanding your organizational capabilities and time-to-market expectations will help determine the version that is right for you: Existing Device Solution MultiConnect OCG-D Open Communications Gateways Device Ideal for companies with software competencies looking for a complete hardware solution Quickest time-to-market Existing Embedded Solution EMultiConnect OCG-E Open Communications Gateways Embedded Ideal for companies with hardware and software competencies Maximum design flexibility 64MB SDRAM 256MB NAND Flash CPU ARM9, 400 MHz GPS UART 2G/3G Cellular SocketModem UART/USB Real-time Clock Temp Sensor 80 pin B2B connector Battery / GPIO / ADC / SPI / I2C / JTAG / Ethernet / USB Host / USB Device / GPS PPS - Data / Serial UARTs / LEDs To help customers focus on their core capabilities, Multi-Tech Systems offers manufacturing partnerships for custom deployment models, software flashing, network provisioning and activation, forward and reverse logistics or other production needs. To help foster custom application development, Multi-Tech hosts a developer community at where developers can explore application notes and collaborate with other developers and Multi-Tech hardware and software engineers. Advanced developer support is also available through the Professional Services Program, in both 5 hour and 25 hour packages. To learn more about the MultiConnect OCG from Multi-Tech Systems, read customer stories, view the datasheet or purchase a developer kit, visit 9/11 Copyright 2011 by Multi-Tech Systems, Inc. All rights reserved. 7

8 About Multi-Tech Systems Multi-Tech Systems offers the industry s most comprehensive M2M (machine-to-machine) communications products and services portfolio available today. As a leader in the industry for more than 40 years, Multi- Tech s reputation for reliability and innovative design is evident with 80+ patents, 20+ million devices being used by thousands of customers worldwide and certifications from more than 30 carriers and over 80 countries. Multi-Tech is certified by the WBENC as a Women s Business Enterprise and by C-TPAT (Customs Trade Partnership Against Terrorism). Find a Distributor Multi-Tech Systems is a multinational corporation with a welldeveloped global distribution network. Please visit the website at to locate a distributor in your area or contact Multi-Tech directly. World Headquarters - USA Tel: (763) (800) sales@multitech.com EMEA Headquarters - UK Tel: +(44) sales@multitech.co.uk 9/11 Copyright 2011 by Multi-Tech Systems, Inc. All rights reserved.