One of the top 10 tech trends for 2014 is a hot topic called, quite simply, the Internet of Things. Estimated by Cisco to have a market value of $14 trillion, with one tenth of that credited to manufacturing, this impacts us in a variety of ways.
In 2013, IoT companies attracted more than a billion dollars in venture capital according to data from CB Insights--an 11% increase from the previous year. Google kicked off a lot of conversation about the Internet of Things early in 2014, with the announcement of its purchase of NestLabs, a Silicon Valley startup, for the tidy sum of $3.2 billion. With this, the connected home became a reality and consumers and investors alike started paying exponentially more attention to concepts like energy management systems and home monitoring.
What Is The Internet of Things?
Often referred to as either machine-to-machine or machine-to-mobile, the Internet of Things refers to obvious things like mobile devices, but also includes devices driven by sensors. This includes things like watches, alarm systems, temperature control systems, car keys, etc. And these are also all things that could interconnect with one another.
Companies like Samsung and GE are already manufacturing products that use the IoT technology and, thanks to companies like Qualcomm, Intel, and Texas Instruments, components that are used to make these products are becoming increasingly not only less expensive, also more efficient.
How This Impacts Business
So, want to know how the IoT and this kind of technology impacts business? That’s simple. Any time you can track consumer behavior it’s extremely valuable. Products that are embedded with sensors allow companies to track the movement of those products and/or the behavior of consumers using those products. This data can then be used for product enhancements, new product development and a myriad of other things. What we’re seeing in the B2B marketplace is companies using the Internet of Things to track products as they move through the supply chain by way of RFID (radio-frequency identification) tags. This allows efficiencies in inventory management as well as a reduction in capital costs.
The aviation industry is a great example of where we’re seeing the use of IoT technology. Manufacturers are building airframes with sensors that send real time data to their computers to track wear and tear on the product. This allows better monitoring of wear and tear and allows for continuous monitoring as well as the ability to act immediately at any signs of deterioration or malfunction.
The IoT Controlling the Home
In the home, the IoT will ultimately control equipment like washing machines and other home appliances, as well as HVAC systems. It will also help consumers’ monitor and track energy usage and allow for maximum efficiency (and money savings) based on real time data. For today’s, energy conscious, eco-friendly consumer, this will likely be an area of great interest. We’re already seeing this with devices like the Nest, which is kind of exciting.
The implications of the IoT doesn’t stop at devices, it can have an impact on humans, too. Doctors can implant RFID devices into humans and gather data that can be used to benefit patients, uploaded onto servers for analysis and maintained as a permanent part of a patient’s medical records. Think about this as it relates to the ability to monitor elderly patients living on their own and the ability for healthcare providers to deliver better, more personalized care.
The Future Looks Bright for IoT
Business applications for the IoT are bright, however, there are still privacy issues and data protection issues that remain of paramount importance. In the not too distant future, we’ll see tech manufacturers updating their products for IoT compatibility as well as upgrading standards for functionality across a wide range of systems and devices. What do you think about the Internet of Things and how it will impact our lives? How will it affect the way we do business? Do you have any concerns over privacy with this technology? We’d love to know what you think.