Fast-paced developments in silicon engineering have brought us to the edge of the Internet of Things (IoT) – and a vast market opportunity of 30bn, 50bn or even 200bn connected objects by 2025. Interest in the realities behind the buzz and the business models that might arise is high, as was evidenced by the standing-room only audience for the panel of The Internet of Everything this morning at ITU Telecom World 2013, moderated by ABI Research’s Stuart Carlaw.
And the benefits of this enormous uncharted business opportunity will not be reaped by one or two major companies, according to Robert Swinnen of Intel, but will be enjoyed by a range of industry players, both traditional and new entrants. “Analytics is the key component to get maximum value from the IoT, as the generation of data will be vast, and achieving actionable information from that data will produce business transformation,” he said.
He warned of the hurdles of establishing business models, standardization, interoperability, security and policies involved in turning the concept into reality, as well as integrating brown field or legacy units into a new and complex ecosystem. These concerns were echoed by IBM Research’s Ling Shao, adding that it is important to factor in and understand device management, as well as remembering that security is a multi-faceted concept: “When a utility or gas company talks about security, they are talking about safety and avoiding disasters, not simply security.”
It is important to remember that the IoT is not a single market but is rather based on the nature of individual businesses, which according to Ling fall into three principal categories: asset-intensive industries such as utilities, for whom the value is in reliable, robust infrastructure and better asset management; connected appliances and vehicles in the smart home, where business models revolve around the value-add of connectivity across massive numbers of devices; and the government level of smart cities, combining different cross sector subsystems to cut costs and improve efficiency overall.
As “agents of openness”, mobile-enabled consumer electronics are pivotal in the ecosystem development, but operators have to go beyond connectivity to create value, said Mr Jean-Pierre Bienaimé, Chairman, UMTS Forum, building on the M2M solutions already happening in fields such as geo-location tracking, transportation, smart metering and health. “Enabling customers to deploy and progressively manage connected objects and end to end applications in multiple domestic markets will grow demand, enabling operators to benefit from global scale.” He continued with the call to action: “This is the time for enterprises and OEMs to invest in connected objects”.
This was enthusiastically echoed by Shawn Sanderson of Jasper Wireless, reiterating that “IoT is no longer a futuristic concept” as the M2M business has exploded worldwide in the past three years, adding, “There is huge value for operators in creating solutions that engage with each other, like the connected car.”
Data generated by billions of machines is the driving force of the IoT, but it is not data alone that creates that enormous potential value, said Cisco’s Robert Pepper. Analytics is the key to creating actionable data that can change processes; and once you can change processes, you can change people’s lives. In healthcare, for example, ICTs and the IoT are turning the concept on its head to monitor wellness and well-being, keeping people out of hospitals in the first place through the use of wearable technology and personal monitoring devices. “This is people to machine and back to people again,” he said. “Looking just in the commercial sector, if there is an adoption of the IoT model across all verticals…it can add more than 14 trillion dollars to the bottom line of companies over 7 to 8 years. That’s a very big number”.
Connecting those devices involves overlapping issues of security, privacy and technology, but involves above all heterogeneity. Some devices will communicate over short distances, some over longer distances, some continuously, some on a one-off or variable basis – such as the pill containing a chip the size of a grain of sand which is activated by gastric juices once swallowed, alerting a patch worn by the user, before travelling the long distance over the network to the consulting doctor checking to ensure the medication has been taken.
So how would the panel define the IoT? For Pepper, it is things, data, process and people in an overall architecture; for Bienaimé it is connectivity, M2M and the Internet of Objects where inert things have or retrieve an identity; for Sanderson it is whatever takes us on to the next stage of connectivity from where we are today, “an evolutionary step where devices and people worldwide interact with one another”.
This was echoed by Ling, seeing IoT as simply the infrastructure which will enable a smarter planet: “Customers care about bandwidth, not what it is called, they just want to solve the business problem.”
The IoT is already upon us and has enormous potential, if issues of standardization and interoperability can be satisfactorily addressed – and if, as Stuart Carlaw pointed out, the business models and monetization opportunities can be realised. It is all technically feasible – but still waiting convincing commercial apps to unleash that value.
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