Monday, January 26, 2015

So, How Big Is This Internet of Things?

There are lots of numbers out there, though a chart entitled “An Explosion in Connected Devices” from the Harvard Business Review and BI Intelligence does a great job of bringing together a variety of data sources to showcase 20 billion as the total number of devices, by 2018.

This not only shows the huge growth potential of the Internet of Things (IoT), but also the many devices – or “Things” – involved: Wearables, Smart TVs, Tablets, Smartphones, and Personal Computers just within the consumer sphere. When you look at the industrial applications, the potential of IoT really expands.

Want to talk dollars? At CES this past January, Cisco boss John Chambers came to his keynote speech with a barrage of IoT statistics (he calls it the Internet of Everything, to encompass the network and not just the things). The most eye-opening stat was the $19 trillion (with a T) in new revenue Cisco alone believes the IoE can generate by 2020.

Driven by exponential growth in our ability to gather or capture and share or analyze data, new tech will, in Chambers’ words, “…get the right data to the right device at the right time to the right person or machine to be able to make the right decision” Chambers argues that even seemingly inane concepts, like sensor-equipped garbage cans, could produce billions of dollars in efficiency-based savings.

Mr. Chambers summarizes, “If you look back a decade from today at the impact of the Internet of Everything, I predict you will see it will be five to 10 times more impactful than the whole Internet has been today.”

Or, as TV’s Ed Sullivan in the 1960s would have said if he’d been asked about IoT, “It’s gonna be a REALLY BIG SHEW!”

Yet, if it’s as big as all those dollars, and all those items, how can you map out the landscape, so you can actually get traction?

“The Silent Intelligence”

A friend of G2Speaks, Daniel Obodovski, a Stanford grad and former Qualcomm innovator, recently wrote a great book, entitled “The Silent Intelligence”. His premise was to “imagine a future where machines talk back”.  His conclusion was that “the future is now.”

Daniel paints the IoT landscape into three distinct phases:

Data Acquisition

This is the device or hardware part of the picture and the key trick enabling the IoT: all of this hardware – these things – are being loaded with tiny microprocessors and multiple sensors.

A simple example comes from when the team at Digeo in Seattle put an Internet of Things-like temperature probe into the first Moxi DVR, which tended to run a bit too hot. By looking at that data, his Moxi team could tell if someone’s cat or a pile of other stuff was sitting on top of the Moxi, blocking the vents and thus setting up pre-mature hardware failure by creating a heat issue for the product.

Today, a plethora of sensors is everywhere and measuring everything.  Smartphones, which fairly recently graduated to 6-axis sensor orientation, are now moving to a 9-axis orientation, and tightening the tolerances to better improve the precision with which they capture your phone’s movement details.

Data Transport

After all that data gets captured by the sensor, it must be moved or shared somewhere via a wired or wireless network. The big Data Transport advance here is the proliferation of wireless and our rapid approach to ubiquitous connectivity. Without connectivity, the IoT would simply not happen. Today, the near-ubiquity of cellular service (2G, 3G, 4G, LTE) ensures connectivity can always be found. And if cellular doesn’t get it, there is always the pager industry’s bandwidth which is under-utilized today while being perfect for IoT’s typical short bursts of status data.

Data Analysis

Once all that data is collected from sensors in devices, and then transported over the network connectivity, it can be analyzed, interpreted, and acted upon directly. Or, when needed, it can be presented to humans for decisions and action.
Data Analysis within the IoT is gaining strong momentum, because big data and real-time analytics are rapidly becoming core areas of specialization that can deliver real customer value. Arguably, Data Analysis is poised to become the biggest value-creating segment of the IoT as the world begins to realize exactly what can be done when you have huge amounts of tiny yet relevant data ubiquitously connected to engines that will crunch the data, spy trends, suggest actions and more.

A Big Company Example

They don’t come much bigger than GE. And GE is all about value creation. Further, GE is actually proving itself to be quite fleet of foot, when it comes to the Internet of Things.
For instance, GE is experimenting with different types of partnerships and joint ventures, to find the optimum way to build out its IoT ecosystem…in the form of oddly-named creatures, like Caradigm, Taleris, and Quirky.

These are examples of how GE is leveraging its relationship with suppliers and other capabilities to support start-up products as they launch. This approach would be rather the opposite of what you might see in the big media space, such as with a company like Comcast that is so reluctant to cede control of anything to any other partner.

Caradigm, for example, is a 50-50 joint venture between GE Healthcare and Microsoft, focused on identity and access management, as well as continuous process improvement in the healthcare world.

Taleris is a joint venture between GE Aviation and Accenture that develops analytic capabilities to manage airline operations. They help airlines predict, prevent and recover from operational disruptions improving operational efficiency and enhancing the customer experience.

And Quirky is a GE investment in a consumer product innovation platform, serving almost ¾ of a million members, who propose, refine, select, fund and help members build new products. This investment has delivered products such as Smart Phone manageable apps that can manage special power-strips and air conditioners, as well as a smart egg tray that monitors the freshness of your eggs and pings you when they go bad. All of these things, developed with the Quirky effort, were on the shelves at Best Buy before the 2013 holiday season.

On another level, GE also partnered with potential competitors, including Intel and Cisco, for network and data center services, as well as with Amazon Web services for cloud delivery.

So, with these GE examples, are there lessons for your company?Notes GE CEO Jeffrey Immelt, “We partner with competitors. We know there’s going to be tons of things we learn and share or giveaway. You’re going to lose some of the control you have today. I think that’s part of the debate. ”

Like GE, do you need to keep building capabilities and finding other strategies to capture value without alienating current participants in your ecosystem?

IoT sensors deployed inside GE jet engines, for example, has enabled them to proactively manage the status, maintenance, and long-term life of GE jet engines, in ways they never could before. In fact, GE has so finely-tuned the data collection, transport, and analysis of jet engine data, that it is now considered to have a major product advantage (beyond the technicalities of the engine itself). This advantage is translating into premium pricing, more customers, and more revenues… for both the original product and even the ongoing support product.

Just as you have to decide, the choices GE makes about the openness of its toolbox and platform will be crucial. GE’s business model is increasingly tied to those of its customers, as is yours, where you are serving more and more operators globally.

Another Big Example

We already made mention of Cisco’s John Chambers’ belief that the IoT/IoE is going to drive billions in new revenue for Cisco alone. Remember that Chambers’ IoE moniker is meant to stress the importance of the network, as opposed to just the things. This makes sense from the perspective of a company that thrives whenever there is more data to move somewhere; routers, switches, and hubs… that’s Cisco.

However, deep within the bowels of Cisco,  there is the cable TV STB and TV Everywhere suppliers; Scientific Atlanta, Linksys, Control 4, Extend Media and so many more all trying to get out and make a dent in the consumer-oriented Smart Home side of the IoT.
And yes, we are aware of the critique that Cisco is this huge, lumbering, too slow to react company, but even at its worst, with all the money and all that investment, it is bound to get a few things right, and thus even in the consumer Smart Home space, it is worthy of observation.


So, whether you are a big company along the lines of GE or Cisco, or a smaller company such as Digeo-Moxi was back in the day, the IoT world is creating tremendous opportunity all around. Consider your industry and business from the framework of “The Silent Intelligence” and determine where your opportunities reside across data acquisition, data transport and/or data analytics.

And then … dive on in, the IoT waters are fine. G2Speaks is ready, willing and able to help.


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