Internet of Things, Big Data and the Industrial Internet are areas that in the last couple of years have gotten increasing attention in the media, in companies and in public institutions. Writing within the theme of Data Driven Business Development, I will in this, and future entries, focus on the meaning of these concepts and their cover. What are the links between the three concepts – if any? And is it purely science fiction or are we actually on the verge of the fourth industrial revolution?

Internet of Things, Big Data and the Industrial Internet are areas that in the last couple of years have gotten increasing attention in the media, in companies and in public institutions. Writing within the theme of Data Driven Business Development, I will in this, and future entries, focus on the meaning of these concepts and their cover. What are the links between the three concepts – if any? And is it purely science fiction or are we actually on the verge of the fourth industrial revolution?

Initially I will focus on Internet of Things as the catalyst for capturing data and communication between objects. Because, I want to make it clear initially – sensors or not – the value is in the data – the utilisation of it, the context in which it is applied, and the new business opportunities it brings along.

Internet of Things is predicted to have a significant impact on the way we live our personal life, the way we run our business, and the way our entire society. Personally, I started my IoT journey a few years ago when I got my first smartphone. A device packed with sensors – e.g. GPS, gyro sensor, compass, fingerprint reader, and microphone besides its ability to communicate with both mobile- and Wi-Fi networks. All of a sudden, I could use my smartphone to track my runs using Endomondo and real time upload the data to the cloud for later analysis. Because of the data that I, and others upload Endomondo can even predict, when I will go for my next run. So – the concept of gathering and transmitting data over a network and the subsequent analysis of it is therefore not be considered as a new phenomenon – so what is new with IoT?

What is Internet of Things?

Internet of Things , Internet of Everything or the more colloquial, IoT is a concept that covers a number of uniquely identifiable objects and their virtual representation in an internet-like structure. But what does it mean – and how does it work? A uniquely identifiable object in this context can be represented by everything from a human being to an animal or a tree , an industrial machine, a smartphone, a wearable , or a car – equipped with a sensor or a sensor network, that can be assigned an IP address and is capable of sending and receiving data over the internet. Based on the collection and processing of data the individual object will potentially be capable of performing an action – be able to act.

Take the tangible example of a modern car, it consists of a number of objects that communicate with each other in an internal network – this communication is termed M2M or machine-to-machine communication. Think of a tyre pressure sensor that communicates a low tyre pressure to a car’s surveillance system or the city emergency brake, which measures the distance to the car ahead and automatically break if it comes too close. The communication between these systems is considered as 1-to-1 communication.

The new thing is that a car, besides communicating among objects in its internal network and to its driver, will be capable to communicate with the manufacturer of the car – enabling a one-to-many communication, as all the manufacture’s cars will communicate with the manufacturer as a central entity. As the prevalence of objects, that is capable of communicating with each other increases, the way of communication will once again change, so that the communication will become a many-to-many – meaning that a car in addition to communicating with itself and its manufacturer also will communicate with its surroundings – including e.g. traffic lights and other road users.

Science fiction or reality – is it now?

The answer to this question is kind of a given in virtue of the above-mentioned examples – the reality of a society where everything is connected in one network is however a vision for the future (5-10 years according to Gartner ), but the journey has already started and there are several reasons for this:

  • The decrease in sensor prices makes it feasible to add sensors to just about everything – temperature and the control of it in your home, tracking the movement patterns of cows in stables via RFID tags, ’the mood’ of a tree in Belgium through setting up ozon sensors, light measuring sensors, a webcam, and microphone, etc.
  • Ericsson and Cisco predicts that close to 50 billion objects will be connected to the internet in 2020. A prerequisite for this is a broad adoption of IPv6, which enables the allocation of the amount of IP addresses needed prospectively. IPv6 can assign 3,4 × 1038 addresses, which is 7,9×1028 more than the “only” 4 billion addresses in IPv4.
  • A broad adoption of Wi-Fi in both private homes and offices supports the connection of an almost indefinitely number of objects to the internet and therefore the potential for a broad prevalence amongst private consumers.
  • A series of large significant players in the market – such as GE, IBM, Cisco, and Intel – has declared their support to IoT and are working with the integration of a so-called fog layer as well as the idea of swarm intelligence – network and integration options that supports the processing of large amounts of data, generated by sensors and transmitted through the network for a massive parallel processing of data.
  • The media’s interest in the concept is prompting the curiosity from businesses and other interested parties, which opens up for investments and broader adoption.
  • Last but not least, a number of analysts and business’s has tried to forecast the potential of IoT and the value that it will produce – the expectation for IoT and the contexts in which the data will be utilised are expected to be of great economic significance – and again both in a business context as well as on a societal scale.

What do we use IoT for?

That everything is connected can in isolation not be regarded as a value creating characteristic and it cannot explain the extensive interest surrounding the concept of IoT. IoT is to be seen in connection to the data that the technology generates and the intelligence that is applied to the data. A sensor on its own does not make a difference but connected to a number of other autonomous objects, which are also equipped with sensors, the collected data from the sensors can be applied to create value in the form of optimization of treatment of illnesses, optimization of traffic, security of users of a product or something else entirely. If you do a google search and type in smart followed by pretty much any word, you will get a wealth of results – here is just a few examples: Smart Planet, Smart Health, Smart Cities, Smart Buildings, Smart Energy, Smart Industry, Smart Transport, Smart Products, and Smart Living. However, is it a hype or a potential? I think that the application possibilities are many and therefore should be thought broadly in terms of usage, development potential and in the context of managing society.

When I have stated that IoT changes the way we understand and act from a societal perspective, this is focused on the utilisation of IoT to support green initiatives such as monitoring the use of water , monitoring of pollution in the oceans, control and optimisation of the electrical infrastructure, the possibility for optimising treatment within the healthcare system, planning and increase security of traffic in cities , and not to forget trivial things like helping us with finding a parking spot.

Changes stemming from IoT regarding our personal lives are something that we will experience in our homescontrolling the temperature is going to get far more intelligent, connecting alarms, locks, cameras, and watering the garden will become a natural part of the infrastructure of our homes – as well as the intelligent kitchen .

From a business perspective, there is great potential in the use of IoT technology. As described above, the ticket to play for companies, will be their ability to deliver smart products or other products for the smart society – that is products that supports the communication with other products in a network – and the business case for the development of these new products is going to be feasible. Besides being able to communicate with the consumer of the product, the product will also be able to communicate with and send data to the manufacturer of the product. The data concerning the use of the product, its status – is there a need eg. soap or paper to be filled in dispensers in a bathroom, or should a maintenance check be performed on a crane – its physical location will all of the sudden be available. This data opens up for new business opportunities based on use patterns – within this, a number of scenarios based on pay per use is brought into play and again unlocks entirely new initiatives for pricing models. New types of partnerships are also initiated; e.g. the intelligent kitchen where Microsoft and Miele have entered into a collaboration – who could you partner up with?

IoT does not come without cost – and there are a number of obvious challenges that needs to solved in the process – be sure to read the next post, where I attempt to clarify these challenges and provide some insights concerning the some of the areas that should be taken into consideration in the implementation process.