Research On The Internet Of Things Industry’s Modular Construction Of And Innovation Of Business Model

The Internet of Things is widely considered as the primitive industry of the future and the next emerging industry of billions worth. In recent years, countries all around the globe are giving intensive focus to it. Several major developed countries are doing plenty of work in the related research and applications. Chinese government listed the Internet of Things industry as one of the five new strategic industries, and included it into the report on the work of the government. In addition, many Chinese cities are planning their Internet of Things industry, and providing demonstrations and supporting policies. However, as a necessary stage in any emerging industry, the future development of such industry is still under researching and discovering. People are facing many new problems particularly in the areas of products developing and producing as well as market development. Among all the problems, the lack of business model that suits the market is one of the most critical ones. This work focuses on such problem and looks into the business model in the area of the market development for the Internet of Things industry. The purpose is to identify a proper way, which can accommodate its own growth, to operate the Internet of Things industry.The Modularization Theory is developed in the 1960s, its goal is to reduce the complexity of an industry by separating and combining its modules, and eventually standardize the structure of such industry. Through systematic competition among corporations, the economic efficiency increases in the industry as a whole. Based on the aforementioned theory, the author holds the view that the Internet of Things industry may be analyzing by it. This work takes an approach in the study and research of the business model of the Internet of Things.We first sort and categorize the existing knowledge of the Internet of Things, business models and the Modular Theory as well as analyzing the current development stage of the Internet of Things industry and its business models. Secondly, we also conclude the characteristics of the modularization of the Internet of Things industry, and treat the driving factor inside of modularity as a combined effect of pushing and pulling factors under the catalyst effects. We then prove that the modularization of the Internet of Things industry effectively increases the economic efficiency with theoretical models. With a finer categorization of the industry chain of such industry, we then deconstruct, adjust and combine the system to be a network composed with modules and related’contact bond’. We explain the ’contact bond’ with the molecular structure of the ’covalent bond’. Additionally, we move our perspective from the view of production to the view of values, and propose a modular operation mechanism based on the business model of Internet of Things constructed from the value modules and ’contact bond1. We men demonstrate the dynamic evolution of such industry with the modularized operations. Finally, we summarize the innovation in such Internet to be the result of the modularized operations on the modules and ’contact keys’. With real world examples besides the aforementioned reasoning, we summarize the core ideas in the innovation of such business model for the Internet of things industry.