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5 Things CIOs should probably know about the Internet of Things

In the past few months CIOs would have been bombarded with headlines along these lines: Internet of Things will disrupt how business will be done in 10 years; So and So says IoT is a gazillion dollar opportunity; IoT will cause new security headaches for IT managers…etc, etc, etc.

In the past few months CIOs would have been bombarded with headlines along these lines: Internet of Things will disrupt how business will be done in 10 years; So and So says IoT is a gazillion dollar opportunity; IoT will cause new security headaches for IT managers…etc, etc, etc.

[Image courtesy: Cisco]

The headlines would, of course, have been followed by futuristic scenarios (some beneficial and some alarmist), details on offerings and products, and other nitty-gritty of what makes IoT so, ahem, different.

And as is likely in such cases of continuous media strafing, people tend to think of the technology either as mere hype or too futuristic or, if I may say, too banal.

But sometimes, when the technology is as all-encompassing as cloud computing or IoT, entire industries, not to speak of companies, can undergo cathartic changes. So let us take a peek at some of the key things CIOs, business decision makers and tech professionals should know about IoT:

The name of the beast: First things first. This much is clear: the idea behind IoT is to get more and more devices, including items of everyday use other than PCs or mobiles, connected to the Internet in order to bring more and more intelligence into the system. So, who coined the term “IoT” and is it the only one to depict that idea?

When I asked Google about it (I didn’t ask Page or Brin but typed in my query, of course), it told me this: “Kevin Ashton supposedly coined the phrase “Internet of Things” while working for Procter & Gamble in 1999.” This puzzled me. See, this information appeared in Google’s own box that comes on top of all other search results, including Wikipedia. I checked Wikipedia, too, and it confirmed the name of the P&G guy. So let’s give the credit to Ashton (though I’m still uncomfortable why Google was unsure and played safe with “supposedly coined”; if Google doesn’t know something for sure, who does? )

As to the terminology, IoT is not the only term and there are other contenders—including Internet of Everything, Internet of Anything and Industry 4.0 (reminds you of Web 2.0, Web 3.0, etc, doesn’t it?) From what I gathered, IoT is by far the most used term, so I’m sticking with it. (There’s another term, M2M, which is considered as the precursor to IoT by many in the industry; while some people quote a few technical differences between the two, it seems M2M is more or less being subsumed or replaced by IoT.)

The scope of IoT is, like, huge: From changing whole business models and impacting supply chains to creating a new environment for how consumers live and how the ever-smarter cities make use of all that embedded intelligence, the scope of IoT is limited only by human imagination.

If you look at the projections for the number of devices to be connected to the Net or the estimated revenue impact from IoT, humongous is the word. While research firm Gartner says the number of connected devices will grow from less than a billion in 2009 to 26 billion units in 2020, estimates from Cisco suggest that 25 billion devices will be connected by 2015 and 50 billion by 2020 (Gartner excludes PCs, tablets and mobile phones from its tally whereas Cisco’s figures include all types of devices). There are projections from other firms as well. Irrespective of whose data you look at, the numbers are much bigger than the entire population of the planet.

Further, a Gartner report says that “economic value-add (which represents the aggregate benefits that businesses derive through the sale and usage of IoT technology) is forecast to be $1.9 trillion across sectors in 2020.” To put that number in perspective, the entire spending on IT and telecom worldwide is estimated to be $3.8 trillion in 2015 as per IDC.

A matter of industries and degrees: As the hype phase continues, no one is denying the overall big-ticket impact of IoT. However, it has been conjectured that the impact will differ in degrees and that certain industry segments will be affected much more than others. According to Gartner, these verticals are leading the adoption of IoT: manufacturing, healthcare and insurance.
But adoption will also depend on which new “things” come up in the market for connectedness and which other segments or companies drive innovation through their own use-cases.

The challenges en route: The direction IoT will take is being set each moment and each day, as vendors (especially biggies like IBM, Intel, Cisco, Google and Qualcomm, among others) continue to jockey for pole position in the market for IoT components, gear or services. One of the major challenges is equipping existing devices with a chip intelligent enough to be powerful and useful yet cheap enough to be commercially successful on scale. Another is the high failure rate of start-ups that come up with new “things,” connected hardware such as smart meters, wearable devices, health monitors, etc. The reasons for failure could range from high cost of development (and hence the device), lack of consumer interest, or just being too ahead of the market.

Companies may also be wary of embracing IoT due to additional liabilities or issues (privacy, legal tangles) engendered by the customer data captured, stored or monitored through IoT devices.
And then, the existence of multiple standards for wireless (Wi-Fi, Bluetooth, Zigbee, among others) will likely continue to be a headache. Pointing to the fragmentation in connectivity, Rob Chandhok, president of Qualcomm’s interactive platforms unit said in a recent article on WSJ.com: “It’s not that things aren’t getting connected—they are getting connected badly.” (In another context, his remark would gel with those who know how Internet generally works in India.)

Management and security hassles: CIOs and other decision makers will have barely eased their BYOD pain when they would be facing the much larger prospect of handling multiple “things” across the length and breadth of the company. On their part, solution providers are working towards filling the gaps in IoT security. For instance, ARM Holdings recently acquired a Dutch firm Offspark to include the latter’s PolarSSL, an IoT security layer for across-the-devices usage, into its mbed IoT development platform. McAfee, owned by Intel, enhanced its security management for Intel IoT gateways. There’s much happening by way of streamlining security for the upcoming IoT world.

Having said that, information security is already a highly complex and daunting task for most organisations—and the complexities and challenges are only going to multiply when more data flows through more devices, often in real or near-real time.

All in all, developments in IoT will be quite interesting for CIOs and decision makers to watch and ready their own organisations for solutions or services relevant to their business.

For instance, the BFSI sector would continue to innovate around micropayments, contactless or virtual cards (that might be apps or embedded into a wearable); healthcare providers would keep coming up with new gadgets and services to remotely monitor health parameters and administer medicine/advice; connected sensors will make better sense of energy use in smart buildings or cities—and yes, more and more fridges will order milk from the supermarket on their own.

Sanjay Gupta is an editorial consultant and freelance writer based in Delhi. He can be reached at thinksanjay@gmail.com

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