The Internet of Things (IoT) is a scenario in which objects, animals or people are provided with unique identifiers and the ability to automatically transfer data over a network without requiring human-to-human or human-to-computer interaction. In simple words, everything is connected over IP and would interact would each other based on pre-defined logic, e.g. refrigerator can order milk by itself when it is about to get over based on past consumption trends.
The keyword is “Things”. Here things includes people and animals which means that in future even the people might be connected to objects like health equipment or household appliances. This might sound straight out of a science fiction movie but that is how human to machine and machine to machine interactions are likely to take place. IoT describes a system where items in the physical world, and sensors within or attached to these items, are connected to the Internet via wireless and wired Internet connections. These sensors can use various types of local area connections such as RFID, NFC, Wi-Fi, Bluetooth, and Zigbee. Sensors can also have wide area connectivity such as GSM, GPRS, 3G, and LTE. In summary, the Internet of Things will: 1. Connect both inanimate and living things 2. Use sensors for data collection 3. Identify, track and communicate with objects over IP network IPv6′s huge increase in address space is an important factor in the development of the Internet of Things. With IPv6, it is possible to assign a unique IP address to each atom on earth and still not run out of IP addresses.
EXAMPLES OF INTERNET OF THINGS
There are multiple ways in which Internet of Things can be used to drive the economic value across sectors. Today, we have a few examples of IoT but it is just the tip of the iceberg and many new use cases would emerge in the future. Some of the prominent examples are as follows: 1. Home Automation – home automation has become the central battlefield of the Internet of Things. This is probably the first and most celebrated use case of Internet of Things. Many houses are moving towards some form of home automation though this area is still evolving and currently very rudimentary form of home automation is being used. 2. Smart water systems and meters – The cities of Doha, Sao Paulo, and Beijing have reduced leaks by 40 to 50% by putting sensors on pumps and other water infrastructure. Smart metres are being used for preventing electricity pilferage and balancing grid loads. 3. Connected advertising and marketing – Cisco believes that this category (think Internet-connected billboards) will be one of the top three IoT categories, along with smart factories, and telecommuting support systems. 4. Healthcare – Hospitalized patients whose physiological status requires close attention can be constantly monitored using IoT-driven, non invasive monitoring using sensors. Remote patient monitoring is also a possibility by securely capturing patient health data from a variety of sensors, apply complex algorithms to analyze the data and then share it through wireless connectivity with medical professionals who can make appropriate health recommendations. 5. Public transportation/smart cities – London iBus system is a good example. It works with information from over 8,000 buses that are fitted with GPS capabilities alongside various other sensors which relay data about the vehicle’s location and current progress so bus stop signposts can display details of a bus’s impending arrival.
MATURITY OF INTERNET OF THINGS AND MARKET FORECAST
Internet of Things is still in infancy and would take over 10 year to get to mainstream. The Gartner hype cycle for emerging technologies (refer image below) clearly shows that the Internet of Things is still in the “Peak of Inflated Expectations” and it is still long way from reaching significant adoption. As per Gartner forecast made in Dec, 2013, the Internet of Things (IoT), which excludes PCs, tablets and smartphones, will grow to 26 billion units installed in 2020 representing an almost 30-fold increase from 0.9 billion in 2009. Gartner said that IoT product and service suppliers will generate incremental revenue exceeding $300 billion, mostly in services, in 2020. It will result in $1.9 trillion in global economic value-add (which represents the aggregate benefits that businesses derive through the sale and usage of IoT technology) across sectors in 2020. The verticals that are leading its adoption are manufacturing (15 percent), healthcare (15 percent) and insurance (11 percent). The potential for IoT is huge. The chart on the right shows the potential of Internet of Things with respect to some of the successful inventions of the digital space. Clearly, the potential is larger than anything till date but for that a lot of players in the ecosystem will need to come together and make IoT a reality.
KEY PLAYERS IN INTERNET OF THINGS
The evolving vendor ecosystem that is emerging to enable the Internet of Things continues to be extremely fragmented and includes a wide variety of small emergent players. A number of start-ups and established players are showing interest. I see the players broadly in two major categories 1. Platform Builders: These players would be the building blocks for internet of things like the carriers/MNO, OEMs, systems integrator, chip vendors, infrastructure services (device management, data modelling, etc. ), Analytics, etc. 2. Vertical Industry Players: These players would develop industry specific solutions on top of the platform builders, e.g. Nest Labs in energy efficiency Below is an interesting IoT landscape prepared by Matt Turck for Techcrunch (Click to enlarge) Source: http://www.telecomcircle.com/2014/05/what-is-internet-of-things/