Estimote will launch an update in 2 weeks, right around the time the National Retail Federation is meeting in New York (a natural home for the company, who claims a clear focus on retail).
The update will include a firmware update that addresses security concerns and the ability to manage UUIDs and connectivity and pairing. But my guess is that it will also include the larger roll-out of features that the company is so far keeping quiet about.
If they go beyond a simple firmware update, it will be a critical release for the company: not only will their pricing policies drive a definition of their market but their list of features and the approach they take will set the bar for a rapidly expanding list of competitors.
If they don’t then their competition will only have that much more time to continue building robust back-end systems and potentially take some of the air out of the company’s stunning trajectory.
Will Estimote Remain a Media Darling?
Estimote is the media darling of the Bluetooth LE beacon industry, helping to build more awareness of iBeacon than Apple itself, and helping an industry of developers and tinkerers to get inside the idea of proximity-based experiences.
With over 10,000 developer kits delivered (and countless more still in transit somewhere) Estimote has given an entire cottage industry hands-on experience with beacons (and claims to be speaking to almost all the major retail brands).
When some industrious coders over at MakeZine ‘hacked’ the Estimote there wasn’t really much news: being a developer kit, the beacons used a common UUID and a shared software development library. The ability to reverse engineer what was happening behind the scenes took some pretty clever legwork but it didn’t demonstrate a vulnerability with how Estimote will be used in the ‘wild’ because the company hasn’t yet launched key components of its system.
But the story did have a perhaps unintended result: in response, Estimote noted that it will be releasing an update in two weeks which will address connectivity, pairing and security.
The fact that a release is coming isn’t news, but to the best of my knowledge this is the first time we have a firm date.
It’s possible that it will be a low-key affair focused on the developer community. In that case, the company would launch some back-end tools, maybe a simple control panel that integrates with their SDK, and the folks playing with Estimote will be able to extend their experiments with the devices.
But don’t bet on it: Estimote is following the Y-Combinator playbook, and while LEAN/Agile is the bible of the Valley, so is keeping the oxygen in your press coverage and how you continue to widen your market as you grow.
5 Things to Watch When They Launch
With that in mind, I consider the next ‘release’ by Estimote to be potentially major. So far, all we know is that it will be a ‘firmware’ update.
But all indications are that this isn’t a company that will do things in half-measures. With recent additions to their staff in New York and hirings for a UK office the company is preparing to tell a larger story to retailers and brands. As I’ve stated elsewhere, a beacon is just a piece of hardware without the services and apps to support it.
To be clear: Estimote is unlikely to launch a new beacon. They’ve stated on numerous occasions that their existing devices will be backwards compatible and that future developments have the capacity to integrate firmware updates. So if we see anything beyond a firmware update what we’ll be seeing isn’t a change in the device itself but the cloud and other services that support it.
(And again, if they don’t do anything MORE than update the firmware, then it will leave a giant open ended question: if not now, when?)
So from the most obvious to what is perhaps the most fanciful, here are five things I’ll be watching for with the next ‘release’.
1. Security and Fleet Management
Estimote doesn’t yet have a ‘control panel’ for its beacons. Competitors like Gimbal, Sonic Notify and even Kontakt have basic or advanced functionality on their back end to help you easily manage your fleet of beacons.
Currently, if you want to change the major/minor properties of your Estimote or assign them to different functions in a store you need to do this through an over-the-air update using an app, or code your own back-end system.
Expect to see Estimote launch a control or web panel with associated updates to its software development kit (SDK) to let you do all that ‘at a distance’. This is the feature that addresses the security issues highlighted by the MakeZine ‘hack’, to which the Estimote CEO Jakub Krzych responded:
The secure mode I mentioned as well as an ability to change UUID will be available in the new firmware version in aprox. 2 weeks. Our intention is not to lock developers with our SDK, but provide the most reliable and secure cross-platform solutions for real-world installations.
- Full cloud support for choosing one of three security levels for your beacons: open, private and secure pairing
- Cloud support for managing UUIDs and major/minor properties with an associated app to deliver the changes to the firmware
- Advanced fleet management tools for larger deployments
2. Region Finding, Triangulation and Zones
Apple has done a lousy job with its iBeacon SDK. Weird toggles between regions, incorrect identification of zones and other problems continue to plague developers. Some of these problems are clear firmware bugs with Apple devices, but others are judgments that Apple has made behind the scenes: how it ‘smooths’ region finding, for example, and how often it polls for nearby beacons.
The way around a lot of these problems is to avoid relying on classes like beaconRegion and use the direct data from the beacon itself: using rssi and accuracy, for example, to bake your own customized methods for finding beacons and assigning them to a ‘distance’.
And while I don’t think there’s any easy way to do it if you only rely on Bluetooth LE because of signal interference, everyone would love to be able to triangulate beacons and go past zones into a more granular mapping of a physical space.
I expect to see Estimote take some efforts to add a few corrections to how ADK and the Apple SDK “find” beacons and provide optional tools that can be controlled from a web panel.
- Cloud-based control panel for setting paramaters for region entry and exit – allowing you, for example, to specify how many seconds a user is out of region before triggering events
- An Estimote-specific interpretation of beacon regions
- A possible “rough cut” of triangulation or beacon prioritization primarily focused on tools that let you set which beacon should have priority when multiple regions are detected
Statistics are the Holy Grail for retailers and advertisers. Being able to calculate how long a consumer spends in a ‘zone’ within a store or how often they visit will be a key requirement of beacons – most often integrated with existing retail analytic engines.
But for smaller retailers, statistics “out of the box” will be a key feature of beacons. They’re not going to want to mess around and while developers will create their own analytics engines, it would be strange if Estimote didn’t launch some kind of basic analytics dashboard – either on beacon performance and usage or on user tracking itself.
- A basic analytics package will focus on beacon performance, aggregated user data and other performance metrics
- An open API or RESTful API will allow developers to build additional statistics on top of the core analytics that Estimote provides
Estimote can make money off of selling beacons. But it’s a market that is rapidly commoditizing. The real money will come through attaching services to the beacons while still giving developers options to create their own stacks. Estimote has never indicated that they’ll charge anything beyond the cost of the beacons, but it’s highly unlikely that it will stay that way. We expect to see pricing publicly announced – and likely with the next major release.
- Costs for the beacons themselves will stay the same, with volume pricing for large deployments
- There will be a free set of basic cloud services
- There will be a more advanced set of services on a subscription basis – say $9/month
- There will be a per user fee for larger deployments, probably in the range of $.05 per user once you tip past 200,000 monthly active users
5. Content Management
I’ve been debating this feature and believe Estimote will take one of two approaches: avoid it entirely, or build a content management system that is deep and robust but focused on a narrow band of use cases, especially small and medium sized retail.
The reason for the debate? What isn’t clear to me is where Estimote sees its market: whether it wants to remain the go-to beacon for developers, or whether it wants to service markets directly. My bet is on the former and that their strategy will be to create a network of partnerships to support the widening list of use cases for iBeacon technology.
- I won’t bet my career on this but I expect to see basic content management functionality that will act more like a ‘demo’ than a robust system
- Instead, Estimote will move towards a broad set of partnerships with other web and mobile services companies
The Wild Cards
Which brings me to my wild cards. While I don’t expect this in the immediate term, my belief is that Estimote will pursue an ecosystem strategy with itself at the centre. In that strategy, their goal will be to create a platform that easily and seamlessly integrates with the API ecosystem of mobile and web services companies.
If you picture the Estimote site having a page that lists its partners, imagine it including companies like MailChimp, Urban Airship, Freshbooks for retailers, Cloudwork, Parse and other cloud SAS and other providers and you’ll have the idea.
- The long-term strategy for Estimote will be to leverage the existing ecosystem of web, mobile and retail cloud services to provide seamless “easy-to-deploy” solutions that integrate best-in-class technologies from across the industry
Which Brings Us to Best-in-Class
Finally – the ultimate wild card: at some point, we’ll see the big players wake up to beacons (and I’m sure they already have).
If you’re Facebook, Pinterest or Square the potential impact of beacons won’t be lost on you. If you’re Square, for example, you’ll have two choices: create your own solution, be ‘agnostic’, or partner with someone else who’s best in class.
So…any bets on when Estimote announces a strategic partnership with the big boys? When do we see a Pinterest branded Estimote beacon? Does Square build its own, or do they take an equity stake in Estimote and work with them instead?
Who knows – maybe Estimote will launch a few handy features for developers in a few weeks and there’s not much to tick off on my list of what’s next.
Or maybe they’ll change the game again and we’ll be starting the New Year with fresh new ways to think about what a beacon can actually be.