Gadgets are becoming increasingly ‘smarter’. Some of today’s cellphones pack more processing power than desktops of a decade ago. Even those devices and objects that never had to be particularly clever – such as smoke alarms, house alarms and thermostats – now contain built-in sensors and wireless networks that digitise them by plugging them into the web, enabling them to communicate and interact with other devices without any human intervention.
This ecosystem of these IP-enabled entities is called the Internet of Things (IoT) and it is not going anywhere. In fact, the trend is set to explode, with global management consulting firm McKinsey & Company estimating that the potential economic impact of the IoT is to reach $2.7 trillion to $6.2 trillion per year by 2025. Back in February 2010 already, the Hammersmith Group published a research report in which it cited a prediction by Michael Nelson, the former director of Internet Technology at IBM as well as the former director of Technology Policy with the Federal Communications Commission. Nelson forecasted that there would be 100 billion devices connected to the net within five to ten years.
The potential for how the IoT can revolutionise business is enormous, says Simon Campbell-Young, CEO of Phoenix Distribution, the leading broad-based distributor of software and hardware on the African continent. “But even though they are well aware that it can generate more money for them than any of the other current big IT trends, managed service providers (MSPs) and vendors are still not doing enough to capitalise on the trend, a study conducted by online security company AVG Technologies has found,” he says.
According to the study, almost three out of five (or 57%) small to medium sized businesses (SMBs) agree that IoT will help boost their revenues. So do around two-thirds (67%) of MSP respondents, yet just 18% of SMBs thought that their IT providers is ahead of the curve when it comes to IoT management, while 70% of MSPs admit that they need to adapt their services to meet their customers’ expectations about IoT, now.avg.com reports. Almost 2 000 small business and MSPs in the U.S., Canada, the U.K., Germany and Australia were interviewed during the study.
But how can businesses and IT vendors capitalise on the development of the IoT? “Earlier this year, market research firm Gartner released a report in which they made a few great suggestions on how this can be achieved,” Campbell-Young says. “Among their proposals were licensing. Just as with traditional software, manufacturers need to protect the intellectual property built into their Internet-connected devices and their applications and monetise it by adopting licenses for it.”
Other clever examples of how the IoT can be put to use by companies to help them boost their revenue is one toy manufacturer that is looking to place sensors on its product packaging. This will help them find out where the toys are being placed on shop shelves and if customers have interacted with it.
In conclusion, Campbell-Young says that the IoT will also create a massive opportunity for those in security to step up and create ways to protect their customers’ environments from the myriad of devices that will connect to it.