Here’s a speed summary of GigaOM‘s latest report on $290bn Internet of Things (IoT) market, and the emerging digital innovation opportunities for the next generation Internet that connects not only pages, people and PCs – but also products. Also embedded is a recent 2013 summary infographic from SAP on the Internet of Things.
Penned by Jon Collins, the full GigaOM report can be downloaded here, but here are the key points from a marketing and consumer innovation opportunity perspective:
- Definition “The internet of things is an ultra-connected environment of capabilities and services, enabling interaction with and among physical objects and their virtual representations, based on supporting technologies such as sensors, controllers, or low-powered wireless as well as services available from the wider internet.”
- Market size for IoT will be $290 billion by 2017, and growing at 30 percent per year (MarketsandMarkets May 2013)
- 31 billion internet-connected devices will exist by 2020 (Intel)
- A family of four will move from having 10 connected devices in 2012 to 25 in 2017 to 50 in 2022 (Intel)
- The Internet of Things is about the convergence between physical and virtual; it’s about ability of physical objects to interconnect and interact
- China has created a special innovation fund of 5 billion yuan (about $800 million USD) special fund to support the “internet of things industry.”
- Whilst IoT makes possible new products and services, much of the immediate value of IoT is increased efficiency of existing services; delivering existing services better and at a lower cost
- Six IoT Growth Areas
- Health monitoring devices and associated online tools, such as Fitbit (see disclosure) for general health monitoring and Corventis, a wireless cardiac monitor
- Household device monitoring including Supermechanical’s Twine and SmartThings, which raised $1.2 million on Kickstarter
- Environmental monitoring tools such as the Netatmo weather station for meteorological data or the Nest intelligent thermostat, which learns the heating properties of a home and controls the boiler accordingly
- Tracking tools including the Tractive pet tracker and Omnilink for tracking cars, offenders, and a variety of assets
- Power management and control including Belkin’s WeMo, Ninja Blocks, and the Revolv (formerly Mobiplug) hub. These enable devices to be controlled from a central point
- Entertainment things, such as the just-for-fun Bubblino, a device that blows bubbles when certain keywords appear on Twitter
- Short vs. Medium Term Opportunities
- Shorter-term opportunities (1–3 year time frame) will come from active and aware things. This means more focus on the things themselves: Look for the things equivalent of the killer app, with less emphasis on backend or cloud-based management and analytics.
- Medium-term opportunities (2–5 year time frame) will come from aware and autonomous things. This implies more focus on infrastructure and platforms that can pull together the management of things and the data they create
- Security (confidentiality, integrity, and availability of both data and services)
- Privacy and surveillance (Scott McNealy’s position (Sun Microsystems) “Privacy is dead. Deal with it.” is not shared by all
- Meltdown (impact of system failure)
Six technology trends driving IoT
- The M2M sensor legacy. Sensors and remote monitoring tools have existed for decades, in a field known as machine-to-machine (M2M) communications, monitoring, and control.
- Retail and the art of supply. The retail and logistics sectors have been driving the use of tracking mechanisms for the assets they manage (e.g. oassive and active radio frequency ID (RFID))
- The ever-expanding internet. The latest incarnation of the Internet Protocol (IP) V6, with an address space of 3.4×1038 unique addresses, was driven by the need to connect an ever-increasing number of compute devices.
- Broadening (mobile) broadband. Mainstreaming of home wifi, 4G mobile, low-power wireless standards such as Bluetooth and ZigBee are enabling just about everything to be connected together.
- The cloud and big data. Cloud computing and big data allow the massive data created by things to be sifted, processed, and acted upon in some way
- Loosely coupled software. Distributed, loosely coupled, transactional approaches in software design are allowing things to exist and communicate autonomously alongside internet-based services
In addition, a new generation of thing-management software is emerging, such as Qualcomm’s AllJoyn platform, ThingWorx, Lhings, LogMeIn’s (partnership with ARM to develop a cloud-based monitoring platform for things), If This Then That (IFTTT) (online rules engine that can work with messages coming from things such as forwarding an email or tweet if a status message is received), and Evrythng cloud software enabling the integration of thing-based events with marketing and sales processes…
Five characteristics of a connected ‘thing’
- Identity: For things to be manageable, they need to be identifiable either in terms of type or as a unique entity
- Interactivity: From passive things such as RFID, Barcodes, QR Codes tagged books that interact as a response, to active things with processing power that can initiate interaction
- Shadowing: Each physical thing is represented virtually within software
- Sensitivity: As well as being able to report on its own condition, a thing can also report on different characteristics of its environment
- Autonomy: Things need to be treated and monitored individually, usually from a remote point, and they must operate independently of a remote control