The Internet of Things, or IoT as it’s commonly referred to, is an extremely hot topic - one that the technology industry is very much abuzz with. It was no surprise that the 2016 Connected Things event hosted by the MIT Enterprise Forum was sold out with 400+ in attendance. With the conference set in the MIT Media Lab, perhaps the most innovative institution globally, it was a fitting setting for a discussion around this emerging industry.
David Rose, CEO & Founder of Ditto Labs and Lecturer with MIT’s Media Lab, delivered the keynote speech to open the day. Hailed as an innovator and a thought leader in design and IoT, he gave a utopian view of “The Enchanted City.” Using examples of utopian cities and biblical stories such as the “Garden of Eden” he painted a lofty picture. More specifically he explained that “Enchanted Objects” or normal mundane objects such as a medication box enabled by technology, would inform and improve our everyday existence. However, just like the utopian Garden of Eden it didn’t last long and the dream was soon given a fresh wakeup call with the learnings from the industry breakout sessions later in the day. We went forth to live and struggle like Adam and Eve in the real world of an embryogenic industry.
IoT Market Size
Perhaps one of the most interesting parts of the day was the Analyst Panel: Where is the Real Action in IoT?, consisting of three senior industry analysts from McKinsey, IDC and Chainlink Research. Each analyst took their turn explaining how they approached the market-sizing question of the IoT industry, this was broken down into three parts:
- IoT solutions and services
- Products and services using IoT
- Value Realized by End Customer.
Most of the analysts took a ground up method of analyzing IoT, but also looked at other industry leading companies such as GE and Cisco to view their approach and industry valuations. What was clear was that valuations are still so unclear, with the industry being valued at anywhere from $1.3 Trillion to $19 Trillion by 2020 depending on the source cited.
IoT Verticals Set for Growth
One very interesting point came from Vernon Turner, SVP of Research at IDC, stating; “This is probably one of the most difficult markets to have a dominate place in, as IoT is extremely hard to define e.g. consumer vs. industrial vs. healthcare, etc.” There was also debate about what constitutes an IoT device - one analyst suggested that a device that provides two way communication is an IoT device and others objected to this stating that if a part of a machine gives a one way update to a controller that will also be considered an IoT device.
One general consensus from the panel was, that the Industrial Internet of Things or IIoT will be where the majority of growth will stem from. Consumer devices are often where the buzz and focus is from the media, but this will not be where the money is. Platforms such as Xively or PTC’s Thingworx will play a crucial role in managing all the interconnected devices of an organization, (perhaps up to 4,000 by 2020 as quoted by one analyst). To give some perspective the market for IoT platforms is 3x the size of the Mobile Device Management market at a total of $30 billion.
Zettabytes, yes you read correctly…..zettabytes was one of the key buzz terms discussed during this session. To all of you mere mortals out there, a zettabyte is approximately equal to a thousand exabytes or a billion terabytes (or so Google told me). It is approximated that the IoT industry will have to manage 44 zettabytes by 2020 and analytics and open data platforms will play a significant role in providing insights into this massive amount of data. Clearly, interoperability will be extremely critical when deploying IoT applications and devices. This means that because IoT will include both hardware and software deployments in physical settings, they must work across organizational and system boundaries in order to be successful.
The State of the Industry Today
After sitting through both the lofty keynote speech and the discussion around trillion dollar industry valuations and zettabytes of data, I was very excited to see and hear about the real-life IoT applications that are being deployed in different industries, this to me was where the rubber meets the road. Unfortunately instead of a tire we got Fred Flintstone's stone wheel. The disparity between the vision of the IoT industry and the actual industry applications deployed was vast. I sat through a session on Hospitals and one of their examples of IoT was “barcode scanning” a technology that’s been around for a long time now. It was fairly obvious that hospitals and healthcare in general were at ground zero in terms of IoT applications and they were still talking about legacy applications and trying to implement smartphones within a hospital setting something that is a relatively mature technology.
One of the sessions that came close to being an IoT story, was the logistics and supply chain case study presented by Air Canada and Unisys. They went into some depth about how they deployed an RFID solution to give better insight and track their cargo throughout the supply chain. This project took an astounding 8 years to deploy with no real clear path to ROI. With RFID far from the cutting edge of technology we were once again left wondering, “where’s the beef” of IoT.