The Internet of Things and the Internet of Everything

Irfan Ali

Director, Global IoT/IoE GTM Strategy

7/28/2014

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Converging Digital Disruptions

The Nexus of Forces

IoT = $1.9 Trillion in 2020

The 3rd Platform

$462 Billion in 2013 (22% of total

ICT spending)

The Industrial Internet

$10 Trillion to $15 Trillion Over

Next 20 Years

Create a Unique Inflection Point

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Cisco Calls It The Internet of Everything (IoE)

Networked Connection of People, Process, Data, Things

People Connecting People in More

Relevant, Valuable Ways

Process Delivering the Right Information

to the Right Person (or Machine)

at the Right Time

Data Leveraging Data into

More Useful Information for

Decision Making

Things Physical Devices and Objects

Connected to the Internet and

Each Other for Intelligent

Decision Making

IoE

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“The Internet of Things is the intelligent connectivity of physical devices driving massive gains in efficiency, business growth, and quality of life.”

What Is the Internet of Things?

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7.2 6.8 7.6

IoT Is Here Now – and Growing!

Rapid Adoption Rate of Digital Infrastructure: 5X Faster Than Electricity and Telephony

50 Billion

“Smart Objects”

50

2010 2015 2020

0

40

30

20

10

BIL

LIO

NS

OF

DE

VIC

ES

25

12.5

Inflection Point

TIMELINE

Source: Cisco IBSG, 2011

World Population

The New Essential Infrastructure

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Network as the Platform

Enablers/Drivers of IoT

GROWTH & INNOVATION

EXPERIENCE

EXPECTATIONS

NEW BUSINESS

MODELS GLOBALIZATION

SECURITY &

PRIVACY

BYOD NEW BREED OF APPS CLOUD BIG DATA ANALYTICS SENSORS & DEVICES

More Innovation and Change than at Any Other Point in Our Lifetime

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What tracking cookies in a browser do for

understanding what Web ads to put in

front of you, a turbine rich with sensors

and complementary software will do for

better operating an electrical grid.

Source: Are Manufacturers Ready for the Industrial Internet? (Thomasnet, Industry Market Trends).

Cisco Confidential 9 © 2013-2014 Cisco and/or its affiliates. All rights reserved. The World Generates More Than 2 Exabytes of Data Every Day

Connected Objects Generate Big Data

46 million smart meters in the U.S alone 1.1 billion data points (.5TB) per day

10TB of data for every 30 minutes of flight With >25,000 flights per day, petabytes daily

A large offshore field produces 0.75TB of data weekly A large refinery generates 1TB of raw data per day

A single consumer packaged good manufacturing machine generates 13B data samples per day

Cisco Confidential 10 © 2013-2014 Cisco and/or its affiliates. All rights reserved. Big Data becomes Open Data for Customers, Consumers to Use

More Important

Less Important

01010100101010101010101010101

01010101010001010100101010101

01110101010101010101

IoT Transforms Data into Wisdom

Wisdom (Scenario Planning)

Data

Information

Knowledge

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Services Services

… But It Also Adds Complexity

Application Interfaces

Infrastructure Interfaces

New Business Models Partner Ecosystem

Applications

Device and Sensor Innovation

Unified Platform

Infrastructure

Security IoT CONNECTIVITY PLATFORM

IoT SPECIFIC NETWORK ELEMENTS

APPLICATION AND BUSINESS INNOVATION

Data

Integration Big Data Analytics

Control

Systems

Application

Integration

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How Big Is the Potential Market?

“Trying to determine the market size for the

Internet of Things is like trying to calculate

the market for plastics, circa 1940. At that

time, it was difficult to imagine that plastics

could be in everything.”

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Sizing the Opportunity

VALUE AT STAKE

19.0* Trillion $

14.4 Trillion PRIVATE SECTOR

Includes Both Industry-specific and Horizontal Use Cases:

Customer experience

Innovation

Employee productivity

Supply chain

Asset utilization

4.6 Trillion PUBLIC SECTOR

Includes Cities, Agencies, and Verticals Such as Healthcare, Education, Defense:

Increased revenue

Reduced cost

Employee productivity

Connected militarized defense

Citizen experience

Estimate Is Based on Bottom-up Analysis of 61 Use Cases, Including 21 for Private Sector and 40 in Public Sector (*2013-2022)

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Big Market and Growing Fast

0

10

20

30

40

50

60

70

80

90

2011 2016

Hardware Services Software

IoT Cisco Addressable Market Size Estimates

in $B / 2011 and 2016

IoT Total Available Market Size Estimates

In $B / 2011 and 2016

36% CAGR

0

10

20

30

40

50

60

70

80

90

1 2

Hardware Services Software

42% CAGR

80.3

17.6 26.9

4.7

2011 2016

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IoT/IoE in Action

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Fear of Derailment

Underutilized Equipment

Poor Passenger

Amenities and Services

Railway Systems

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Railway Systems

Immediate Response

to Equipment Failure

Real-time Health Status

of Trains

New Passenger

Amenities and Services 35% REPLACE

BEARINGS

CAR 07

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City Infrastructure

Delayed Emergency

Response

Poor Congestion

Management

Limited Budget

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City Infrastructure

Synchronize Signals for

Emergency Vehicles

Improve Congestion

Management

Better Profitability

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Oil Pipelines

Poor Leak Detection

Limitations in Network

Connectivity

Costly Maintenance

and Management

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Oil Pipelines

Proactive Leak Detection

Predictive Management

Broadband Connection

for Community

S6 | C026 Pressure

Drop

5000 kPa

ACTION

REQUIRED

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Load Imbalances

Poor Use of Brownfield

Assets

Increasing Demand

Utility Substation

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Utility Substation

Local Load Balancing

Operational Efficiencies

New Business Models

01 02 03 04 05 06 07 08 09 10

Maintenance

Needed on

Transformer 7

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Manufacturing

Poor Overall Equipment

Effectiveness (OEE)

Increasing Energy Costs

Cyber Security Threats

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Manufacturing

Predictive Maintenance

Optimize Energy Usage

Security Before,

During, and After Attack

QUALITY POWER STAMPS

35% 85% 592547/ 1000000

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5 Requirements for Successful IoT Implementations

Converged,

Managed

Network

Resilience at

Scale

Application

Enablement

Security &

Privacy

Distributed

Intelligence

Foundation… Trusted Leadership, Innovation, and Reliability

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Converged, Managed Network

Traffic Control

Telemetry Passenger

Wi-fi Passenger

Safety

Trains Machine

Parts Access Points

Video Cameras

ERP CRM VOIP Video

PCs Smart-phones

Datacenter Branch Offices

Operational Technology Information Technology

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Convergence Delivers Control Over IP

Traffic Control

Telemetry Passenger

Wi-fi Passenger

Safety

Trains Machine

Parts Access Points

Video Cameras

ERP CRM VOIP Video

PCs Smart-phones

Datacenter Branch Offices

Operational Technology Information Technology

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Convergence Delivers Control Over IP

Traffic Control

Telemetry Passenger

Wi-fi Passenger

Safety

Trains Machine

Parts Access Points

Video Cameras

Operational Technology

ERP CRM VOIP Video

PCs Smart-phones

Datacenter Branch Offices

Information Technology IoT

Traffic Control

Passenger Wi-fi

Video ERP CRM VOIP Project Mgmt.

Asset Tracking

Fleet Operations

Sensor Network

Email HRMS

Trains Machine

Parts Access Points

Video Cameras

Branch Offices

Sensors PCs Smart-phones

Data-centers

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Converged,

Managed

Network

Requirement Summary

End-to-end network architecture

Resilient, scalable, manageable

Open standards based

Proven network security and identity management

Greater mobility (even in harsh environments)

Enables new business models and services Delivers End-to-End Monitoring and Network Control

Scalable, Flexible, Secure

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Learning Networks Enable Scale

PREDICTIVE PERFORMANCE

ANALYSIS

ANOMALY DETECTION

ADAPTIVE SECURITY

IoT ENVIRONMENT LEARNING NETWORK

DATA

OPTIMAL

PERFORMANCE

HIDDEN

Sensors, cameras, cars, wearable sensors,

traffic lights, computers, smart meters

OBSERVED PARAMETERS

MODEL

LEARN ADJUST

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Proven end-to-end architecture

Application-aware infrastructure

Flexibility for management

Complete lifecycle services

Distributed computing capabilities

Resilience at Scale

Requirement Summary

Resilience at

Scale

Always On and Always Ready

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IoT Expands Security Needs

IoT CONNECTIVITY

Converged, Managed Network

Resilience at Scale Security Application Enablement

Distributed Intelligence

Increased Attack Surface

Threat Diversity

Impact and Risk

Remediation

Protocols

Compliance and Regulation

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The Secure IoT Architecture

Services Services

Application Interfaces

Infrastructure Interfaces

New Business Models Partner Ecosystem

Applications

Device and Sensor Innovation

Unified Platform

Infrastructure

Security

APPLICATION AND BUSINESS INNOVATION

Data

Integration Big Data Analytics

Control

Systems

Application

Integration Network and

Perimeter Security

Physical Security

Device-level Security /

Anti-tampering

Cloud-based Threat Analysis /

Protection

End-to-End Data Encryption

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Security and

Privacy

Requirement Summary

Visibility and consistent control

Pervasive and adaptive

Situation-aware

Functional and flexible

Rapidly Scalable

Built in, not bolted on

Tested and validated

Reduced complexity

Deep Security Controls

Delivers Security Across the Extended Network – Before, During, and After An Attack

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IoT CONNECTIVITY

Converged, Managed Network

Resilience at Scale Security Application Enablement

Distributed Intelligence

Vast Amounts of Data

Local Control Loops

Detached Applications

Expensive Bandwidth

Low Cost of Edge Compute

Scale

Why Distributed Intelligence?

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IoT Requires Distributed Computing

Traditional Computing Model (Terminal/Mainframe, Client-Server, Web)

Endpoint

Data Center/ Cloud

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IoT Computing Model

IoT Requires Distributed Computing

Data Center/ Cloud

Device

Fog

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Requirement Summary

Converged computation, storage, and communication at network edge

Purpose-built networked devices

Open standards based framework

Proven end-to-end architecture

Deep security controls

Distributed

Intelligence

Computing In A Way Never Before Possible

Distributed Intelligence

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IoT CONNECTIVITY

Why Application Enablement?

Converged, Managed Network

Resilience at Scale Security Application Enablement

Distributed Intelligence

Open and Standards-Based

Ease of Management

Flexibility

Ease of Integration

Automation

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Application

Enablement

Requirement Summary

Open standards based framework

Flexibility in management and control

Network-aware applications

Imagine the possibilities of IoT

Application Enablement

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Cisco IoT Leadership

IoT Network

Platform

IoT Solutions

Portfolio

IoT

Investment

Fund

IoT

Innovation

Internet of

Things

Global

Partner

Ecosystem

Standards

Development

Cloud

Intelligent Network

Data Center

Fog

Routing

Switching

Security

Wireless

Embedded

Network Management

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Energy-Utility Oil and Gas Manufacturing SP/M2M City Transportation Mining Defense

Plantwide Ethernet, Intelligent Transportation, Smart Cities, S&C Refinery, Smart Connected Vehicle, Smart Grid

Cisco Internet of Things Portfolio

Plant Switching Plant Routing Field Network Embedded Networks Physical Security

Network Management and IoT Security

Fog Computing; Cisco IOx

Data Center/Virtualization

IE 2000 IE 3000 CGS 1000 CGS 2500

CGR 2000 CGR 1000

819H M2M ISR Gateway Router

1552 Rugged Wireless

5915 + 5921 + 5940 Rugged Embedded Services Routers

ESS2020 Rugged Switch

Video Surveillance Manager and IP Cameras

Physical Access Manager

IPICS

ASR 903

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Field Area Network: Open Standards Reference Model

IPv6/IPv4

UDP/TCP

IEEE 802.15.4e MAC Enhancements

IPv6 RPL

Web Services, EXI, SOAP, RestFul,HTTPS/CoAP

802.1x/EAP-TLS and IEEE 802.11i-Based Access Control

Physical Layer

IEEE 802.15.4g 2.4GHz, 915, 68MHz DSSS, FSK, OFDM

IEEE 1901.2 NB-PLC OFDM

IEEE 802.11 Wi-Fi

2.4, 5 GHz, Sub-GHz

IEEE 802.3 Ethernet UTP, FO

2G, 3G, LTE Cellular

IEEE 802.16 WiMAX

1.x, 3.xGHz

Data Link Layer

IEEE 802.15.4 Including FHSS

IEEE 1901.2 802.15.4 Frame

Format

IEEE 802.11 Wi-Fi

IEEE 802.3 Ethernet

2G, 3G, LTE Cellular

IEEE 802.16 WiMAX

6LoWPAN (RFC 6282) IPv6 over Ethernet (RFC 2464) IPv6 over PPP

(RFC 5072) IP or Ethernet

Convergence SubL.

Network Layer

Transport Layer

Application Layer

Addressing, Routing, Multicast, QoS, Security

Security (DTLS/TLS)

DNS, NTP, IPfix/Netflow, SSH RADIUS, AAA, LDAP, SNMP,…

(RFC 6272 IP in Smart Grid)

Metering IEC 61968 CIM, ANSI C12.22,

DLMS/COSEM,…

SCADA IEC 61850, 60870

DNP3/IP, Modbus/TCP,…

LLC

M A C

Mgmt

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Energy-Utility Oil and Gas Manufacturing Mining

SP/M2M City Transportation Defense

Building an IoT Ecosystem

Ruggedized Wireless AP

Industrial Routers and Switches

Industrial Security

Hardened Mobile M2M Gateway

IP Cameras

Video Surveillance

M2M

Mobile SPs Advanced Services

“Customer-In” Approach

Understanding of key business

care abouts and pain points

Relevance to LOB leaders / CXOs

Products/Technologies

Best-in-class ruggedized products

Smart solutions for verticals

IoT architectures

Strategic Partnerships

Industry partners

Vertical software / service partners

Service providers

Time Sync

Pervasive Cyber

Security

Scalable Routing

Deterministic Ethernet

Guaranteed Delivery

Big Data Management

SP Services

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30 Years as a Trusted Technology Partner

Cisco and the Internet of Things

End-to-end IoT Solutions

World-class Professional Services

Maximizes Flexibility, Scalability, Security

Thank you.