A Smarter Approach to IoT

David Murphy

iotforum JoeJoe Glover, who produces the IoT Forum, 
which takes place on 9 and 10 March in Cambridge, UK, argues that to see the commercial future of the Internet of Things, we need to look beyond our wrists.

The ‘Internet of Things’ (IoT) is a sexy phrase. The hype around it alludes to a life connected through trillions of invisible data points. These interactions shape the physical world around us, help us understand ourselves better and even monitor our health at the touch of a button… or so the story goes. Add valuations of nearly $11 trillion (£7.8 trillion) by 2025 (Research and Markets forecast) to the equation, and entrepreneurs, investors, and corporates alike start doing their best impression of one of Pavlov’s Dogs. But, removing the shiny veneer of promise, where do the commercial opportunities in IoT really lay today and in the future?

The image of IoT plays into the hands of those pedalling the current crop of consumer IoT devices, the clearest example of which can be seen in Smartwatches and fitness trackers such as the Apple Watch and the Fitbit. For all the right reasons, these consumer companies could hardly be accused of doing their best to dispel the idea of this sexy new tech.
Just watch the people in this video.

And this image works to a certain degree. In FY15, Fitbit reported revenues of around $1.8bn, with a 22 per cent share of the wearables market. Not too shabby.

Useful data
By considering the useful data received from Fitbits, or even the functionality allowed by popular IoT devices such as Hive or Nest, it’s clear to see that, despite being a few years into a global Internet of Things revolution, consumers still don’t really get it. For example, two years ago at the IoT Forum, I watched on as Andy Stanford Clark from IBM allowed the audience to change the colours on a cube by tweeting at it – the result was giddy applause. I don’t think the response would be that different today. In fact, when London tourists were invited to do something similar, changing the colour of a Janet Echelman sculpture via an app on their phone as part of the recent Lumiere London festival, it wasn’t.

The wearables market is limited by human form (we’re not putting IoT inside us in any sort of meaningful way yet); and human nature (around 12.5 per cent of Fitbit users stop using their device within a month). Further to this, convincing those outside of the early-adopting techies of the value of IoT is no easy sell. Combining these limitations, it’s clear to see the wearables market represents just fraction of the total money up for grabs in the IoT market.

Instead, by quantifying the gains from IoT, we should be able to see that the real future of IoT lays in commercial applications of IoT devices. Not only in terms of the many multiples more gain to be had from more useful data, but also in terms of the savings to be made by doing things more efficiently and through automation.

Smart Cities is just one small example of how the world is beginning to explore the benefits of the Internet of Things in non-retail markets. In 2015, the UK government invested £140m in the exploration of the potential of Internet of Things for Smart City developments. Viewing this investment as an individual pursuit across the plethora of applications in healthcare, transport, energy, agriculture and manufacturing, and multiplied by the number of countries looking to take advantage of the gains to be had through the Internet of Things, it’s clear to see that the future of IoT in a commercial sense does not start and end on your wrist. The problem is, I guess, that self-monitoring litter bins on city streets, or soap dispensers in office blocks, are just not as sexy as fitness trackers, even though they have the potential for massive cost savings, by enabling us to only pay attention to mundane items when that attention is needed.

But of course, the $11 trillion figure is merely a projection. Today, the foundations are being laid and the first set of walls are going up. It remains to be seen if the potential of the Internet of Things can be capitalised upon. But be rest assured, now is the best time to catch the train and get a piece of the commercial gains from the future of IoT.

Joe Glover works at The BLN producing the IoT Forum which takes place on 9-10 March in Cambridge, UK