Business model innovation driven by the internet of things technology, in internet service providers’ business context

Business model innovation (BMI) describes the efforts made by the business in finding new business logic or new ways of value creation. Technological change is deemed to be the main driver of BMI. This study focused on the emergence of the internet of things (IoT) as a technological driver of BMI in internet service providers’ (ISPs) business context, in the scope of wired access (WA) and fixed wireless access (FWA) providers, and addressed new ways of value creation for ISPs driven by IoT. To this end, a four-stage BMI process, including; initiation, ideation, integration, and evaluation, was used. In the implementation of the BMI process, we used the data extracted from the literature of IoT, BMI, and ISP business, as well as those obtained through interviews with experts. As a result of the process implementation, we identified possible ideas for the value creation of ISPs in the IoT domain, based on connectivity service providing, cloud service providing, technical solution providing, and business solution providing. Then, we proposed ISPs’ business models in the IoT domain, in accordance with the identified ideas, based on Hedman and Kalling’s ontology. To boost the validity of the proposed business models, the stress testing approach was recruited at the final stage of the BMI process. Implementing BMI, driven by IoT, in the ISPs’ context, reduces constraints imposed by the paucity of knowledge in both BMI and IoT, helps ISPs’ managers to anticipate and identify the IoT-based opportunities, and provides a starting point for further studies on new ways of value creation in other businesses in the telecom industry.