ABSTRACT Internet of Things (IoT) is a technological marvel that is going to revolutionalize the way we interact with our world . Simple objects make themselves recognizable in the Internet space as they can communicate information about themselves and can access information that has been aggregated by other things through the use of internet. The expected future for IoT looks very bright, with analysts predicting that by 2020, nearly 50-100 billion devices would be attached to the Internet and the size of the Internet would increase by nearly 1000 times. The growth is aggregated by the fact the IPv6 can hold 2^128 times the total number of addresses that IPv4 could. According to a survey by Forrester Research, more than 80% of the respondents accepted that they have major plans for an IoT solution in the coming 2-5 years. The market size of IoT is predicted to reach $300BN by 2017 and $50BN for Machine to Machine M2M communications by 2013 according to a Research & Markets report. The IoT started in 2007-08, when the number of things attached to the Internet exceeded the population living in the world.
The stakes are high in this domain; thus, the competition is high too. CISCO & IBM have already taken their action plans to realization with many major projects around the world. Application development firms like Nest Labs are also keen on making their mark in the industry.
This paper provides an overview of what exactly this technology is, how it became so important in the last few years, and what importance it will hold in the future. The paper also illustrates how IoT can provide business and societal benefits to global businesses and communities, respectively. The competitive landscape has been showcased, with the paper closing at how CSC can make the most of this massive opportunity.
The goal of this paper, therefore, is to educate the audience about IoT in plain and simple terms and understand its potential to change everything we know to be true today.
WHAT IS THE INTERNET OF THINGS? EXPLANATION It is nothing shocking for us to imagine a mobile phone or a laptop connected to the Internet. Now consider a cow connected to the Internet! Through this, imagine that the cow can tell that it is thirsty, can inform of its hunger, and also when it is ready to give milk.
Source#Image1-www.zdnet.com
Shocked? Yes, a cow can now give out information through the Internet. A scenario that would have become the laughing stock for everyone in the past is fast transforming the Internet as we know it. There is no standard definition for the IoT, but Wikipedia defines it as, “uniquely identifiable objects and their virtual representations in an Internet-like structure.” But today’s Internet of Things is more than this! (1) Imagine a scenario where cars automatically change routes if they sense traffic ahead, you get a reminder from the medicine box in case you forget to eat your medicine for the day, the trees automatically tell the farmer that the fruit will ripen on a certain day of a certain month, your spectacles give you a location of where they are whenever you lose them. So equipping all things and objects with small identifying devices or chips so that they can be identified on the Internet is the IoT. Each physical object on this earth would be accompanied by a chip/RFID, which would help identify and communicate with other similar objects in the future. This information from billions and trillions of tags will have an incredible impact on our lives! EXPECTED FUTURE OF THE INTERNET OF THINGS Ericsson, in a bold statement, predicted that by 2020 nearly 50 billion things (2) may become connected to the Internet. Consider another prediction; CISCO predicts that the Internet may grow 1000 times the size that it is today (3). If this doesn’t excite you, consider that McKinsey estimates that across the healthcare applications analyzed, Internet of Things technology could have an economic impact of $1.1 trillion to $2.5 trillion per year by 2025 (4). All these estimates may be called very optimistic, but we need to consider that the number of connected devices in 2010 were 12.5 billion in comparison to 500 million devices accounted for in 2003 (5).
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Source#Image2- CISCO ISBG, April11
TODAYS TRUTH - MORE OBJECTS CONNECTED TO THE WEB THAN HUMANS According to Figure 1, we notice that in 2003, the world population stood at 6.3 billion and devices connected to the Internet looked miniscule in front of this figure at 500 million, which roughly comes out to 0.08 devices per person. In 2010, the number of connected devices grew many-fold and reached 12.5 billion, which is approximately 2 devices per person. CISCO estimates that this number will grow by leaps and bounds to reach levels of nearly 7 devices on the Internet for every human on the earth. But consider this fact: Internet and computers haven’t reached every corner of the world. Even by 2020, we cannot expect 100% of the world population to be connected to the Internet. It is estimated that Internet using population would reach 4 billion (6) by 2020, thus bringing the actual connected devices per person to 12.5. CISCO estimates that the IoT came into existence the day number of devices connected to the Internet became more than the number of people living on the earth, between the years 2008-09. These were the years when the race for smart phones and tablets had just begun. HOW IT ALL STARTED Though the explosion in Internet usage had begun from the day the Internet came into existence, IoT came through a lot later. The term ‘Internet of Things’ was coined by Kevin Ashton in 1999, when he and his group were working at the Massachusetts Institute of Technology (MIT) Auto-ID Center. The original idea of the Auto-ID Center is based on RFID tags and unique identification through the Electronic Product Code (7). He did not use the term exactly in this regard, but was working in the field of Radio Frequency Identification (RFID), where this term came up, after which it was generalized and used for the IoT we know in the present. Since that time, RFIDs have proliferated deep and wide into our world and are on a verge to merge the physical world into the virtual world. A much-acclaimed research says that these RFID chips would soon be available at five cents per tag by 2015 (8). This means that we are now on the doorstep of such a world. Source#Image2.1- The Evolution of Internet of Things- Casaleggio Associati
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Source#Image3-www.nkonnect.com
UNDERSTANDING IoT’s IMPACT ON BUSINESS AND SOCIETY To understand the IoT’s impact on business—as well as on the larger society—it is useful to focus on the capacity of IoT applications to: (9)
• Inform, for example, by gathering information through sensors, to • Automate and prescribe activities, for example by allocating a function to a system or by supervising the fulfillment of an
activity, and to • Transform activities, for example by redesigning a business process.
BENEFITS ARE MANY, SOME THAT WOULD TRANSFORM THE FUTURE Remote Tracking Today, a standard home has a daily process where lights are switched on and off, AC temperature set among others. In future, we can expect these things, as well as doors, windows, etc., to have a unique ID. Through this, the owner will be able to remotely access and control each of these devices. We have already seen the start of such concepts, but on a comparatively smaller scale. Examples can be some apps that can seize the car engine in case it gets stolen or remotely locate a car from a computer. We can expect a much larger scale for such tracking in the future. Work Process Transformation Supply Chain management is where the term ‘Internet of Things’ first came in; thus, a lot of heavy investment has been constantly going in the streamlining of the work process and supply chain. The IoT will eventually lead to a transformation of work processes, as organizational responsibilities for control and accountability are changed and redistributed. There are many benefits attached to this technology, like reduction in manual errors and improved stock control.
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Auditing With its capacity to collect data about work activities and the locations of assets, the IoT promises increased control of complex auditing situations, especially in large firms. Companies are also under pressure from regulatory authorities, clients and insurance companies to become more transparent and this is the need of the hour. Technologies are increasingly being introduced into industrial workplaces to promote auditing and verification. Building Smarter Cities In the UK, South Korea, UAE and other countries, cities and municipalities face the conflicting challenges of promoting economic growth and ensuring sustainable development. The IoT is seen as an answer to this crisis and a partner in achieving these efficiency gains, by promoting growth and achieving environmental goals though curbing emissions, discouraging environmentally harmful behaviors, and encouraging energy saving. Several global cities are currently underway to be centers of this change by developing IoT infrastructures to digitize existing physical infrastructures for energy, water and transport. Design of Public IoT Infrastructures All around the world public infrastructure is becoming more and more dependent on the use of IoT. Consider some global examples – in South Korea, Incheon Metropolitan Area authority is transforming the city with better city management, enhanced life quality for citizens and supporting sustainable economic development. In Amsterdam city, public transport is being equipped with monitors; in India, trains are being equipped with WiFi devices. This would not only help to provide convenience to public, but also ensure safety and minimize carbon production. Also, energy-efficient homes, factories, energy management, hospital & patient monitoring are becoming a reality the world over because of IoT. Resource Allocation and Optimization In business, storage represents a huge cost, but no company can take chances and always has inventory in place. Now, if each of the products was marked with RFID tags, which in turn were connected with the Internet, which led to automatic order placement, a lot of time would be saved. For example, imagine a restaurant using a can of sauce. Just when the last bottle of sauce is picked from the refrigerator by the cook, an automatic signal is sent from refrigerator to the computer. From the computer, with use of Internet, an order is automatically placed with the supplier, who delivers it just before the last can of sauce finishes. Automation and Decision Optimization Decision-making powers in crisis situation can be the next breakthrough in the world, especially in transformation. Imagine two trucks approaching each other on a foggy night; the “computer machines” in the two trucks would take over. The machine would primarily send a warning signal to the driver about the danger, at the same time communicating with the other truck and deciding how each machine should move to avoid the collision. The assumption was that if the two drivers were warned and were in control to make quick decisions, they could both decide to make similar turns that would still cause a crash anyway. The previous pages were just a few examples where the world is transforming. Here is an infographic from Beecham Research which shows in detail the potential that IoT can unlock.
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Source#Image4-www.symplio.com #Beecham Research
There are some conditions that are common to all the above examples:
• Nodes for sensing – Sensing and data collection capability • Nodes for processing – Layers of local embedded processing capability • Nodes for connectivity – Wired and/or wireless communication capability • Software solution – Software to automate tasks and enable new services • Remote processing – Remote network/cloud-based embedded processing capability • Security – Full security across the signal path
WHAT RESEARCH GIANT FORRESTER SAYS In the first half of 2012, Forrester conducted primary research through online surveys of IT executives at 646 global enterprises representing primary operations in 11 countries, in industries including manufacturing, healthcare, oil/gas/petroleum, retail, hospitality, transportation and logistics, and government. The survey by Forrester Consulting "Building Value from Visibility: 2012 Enterprise Internet of Things Adoption Outlook" showed the following results: Momentum seems to be running high in favor of IoT. (10) 15 percent of surveyed organizations across the globe already have an IoT solution in place, 53 percent plan to implement one within the next 24 months, and another 14 percent plan to implement one in the next two to five years. The research findings show that more than 80percent of the surveyed firms showed a growing interest in IoT.
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THE INTERNET OF THINGS – COMPETITIVE LANDSCAPE The activity around IoT is fast beginning to heat up, with everyone from venture capitalists, entrepreneurs, huge IT corporations, media, consultancy giants and governments looking for ways to get a piece of the IoT cake. Estimates coming from research firms predict the market size of IoT to reach $300BN by 2017 (11). So anyone with considerable knowledge and expertise in this domain is ready to reap the benefits; those with no prior capabilities are fast developing them. The $50BN (11) market for machine-to-machine (M2M) communications is also significantly boosted because of the IoT revolution.
Source#Image5-www.techcrunch.com Image5 is an attempt to making sense of the frenetic activity in this field. The chart is divided in three areas- first, the building blocks at the bottom, followed by the verticals and horizontals. These are explained below: BUILDING BLOCKS These are those blocks which contribute to the growth of IoT, basic things necessary for the revolution to truly come in. For example, hardware is comparatively easier and cheaper to produce than in earlier times. Finance too is not much a problem as sites like kickstarter are ready to invest in good technological ideas. Secondly, now more than ever people have access to Internet through smartphones, laptops, tablets. Infrastructure like Wi-Fi, Bluetooth, 3G, 4G is scaling the world. IoT can also leverage the other infrastructure like Cloud and big data tools to process the massive amounts of data used. VERTICALS The Internet of things is seeing a lot of action directed at the vertical application. Some notable players like Nest Labs have adopted a deeply integrated vertical strategy, where they control both hardware and software. Home automation in general has
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become the battlefield for start ups. In B2B category, Robotics hold considerable promise in a number of areas such as manufacturing, transportation, healthcare, retail and energy. Some of clearest revenue opportunities for IoT startups are in the enterprise area. HORIZONTALS The ultimate prize for any ambitious player in this category is to become the software platform, which all vertical applications will be built upon. Large corporations (GE, IBM, CISCO etc.) are very active in the space and are developing their own platforms. This space is very much in infancy but is seeing a lot of buzz. HOW CSC CAN MAKE THE MOST OF THIS OPPORTUNITY The world is abuzz with activity around IoT. Since this concept is in the infancy stage, a lot can be done to create an impact on the market. As already mentioned, according to a Forrester Survey, more than 80% of companies are positive about IoT and have major plans in this area planned in the next 2-5 years. So can CSC. Here are a few examples where CSC can make a mark on the Internet of Things landscape. BUILD SMARTER CITIES As the world progresses and the demand for cleaner fuels and efficiency come in, there is a high potential for building such cities. CISCO is already working to build a smart city with Incheon Metropolitan Area authority in South Korea by transforming the city with better city management, enhanced life quality for citizens and supporting sustainable economic development. Also, IBM has teamed up with Mediterranean island of Malta to build a smart utility system, to monitor electricity use in real-time and set variable rates that reward customers that cut their power consumption. Masdar city in UAE is also being developed as the World’s Most Sustainable City with solar and wind power, electric driverless cars, and digital plumbers. These are all multi-billion projects & in high demand. TRAFFIC MANAGEMENT It is a fact that the number of cars on the road is increasing, be it developed countries like the US or developing ones like India. Traffic management has become a key issue for every city authority around the world. There is high demand for a solution that can connect cars to the Internet world. Apart from standard traffic management, parking troubles can also be sorted with this technology. The US Department of Transportation is conducting trials in 2013 on technology that can be used to connect cars to each other and to public infrastructure to ensure smooth traffic flows and avoid accidents. Tolls, navigation, digital signage are just a few places which require such solutions.
PUBLIC SAFETY Public safety issues have been on a rise since more than a decade; the world today is considered more dangerous than ever before. So, a heavy investment is expected in this field. In the US alone, by 2016, the US Public Safety IT spending is going to rise to $24BN (12). The major areas of expenditure in this field are Surveillance, Tracking, Emergency Services & Public Infrastructure. CSC has been a favorite for the NPS and these contacts can be used to garner contracts for public safety. Infrastructure development and monitoring emergency vehicles, among others are the areas where IoT can be of high usage. INDUSTRIAL Considering the fact that CSC already has much experience of the manufacturing industry, entering with an IoT solution and providing services around it would be relatively easier. Resource automation, process transformation, distribution can be areas of investment. When everything is connected to this vast network of networks, it reduces the chance for manual error. With increased competition in every market, chances for error and inefficiency must be reduced. So a solution that monitors and services supply chain would be beneficial to each industry. HEALTHCARE McKinsey estimates that across the healthcare applications analyzed, IoT technology could have an economic impact of $1.1 trillion to $2.5 trillion per year by 2025. CSC already has a solution for healthcare; thus, it is already aware of market and its requirements. Consider that global tele-health — the use of remote patient monitoring — saw a 22 percent increase from 2010 to 2011, according to IMS Research. And for 2013, the worldwide tele-health market is predicted to grow by 55 percent, in terms of device and service revenues, InMedica reports. IoT can be helpful in ongoing monitoring and data tracking, among others. From devices that connect to our bodies to help us track and record exercise, sleep, and health information to “smart pills” that tell doctors whether we’re taking our medicine, and if so, how it’s working, IoT is poised to become the next big thing for the healthcare industry. FINANCIAL SERVICES INDUSTRY The insurance industry is the first to adopt IoT with open arms. Insurers now offer computer devices for the car that monitors driving behavior and reports it back to the provider over a wireless network. The provider uses this to adjust premium rates by use of data for telematics technology. Allstate Insurance is now exploring a more active approach – real-time feedback to drivers. In the longer run, use of IoT will help in change of exposure for Insurance companies. It’s a win-win, customer achieves lower rate of premium, and Insurance companies face lower payouts and a higher engagement with the customer. Such IoT-driven solutions will be high on demand. What these companies and solutions have in common is that they gather data and information in real time through networked sensors, and they use this information to create cues to trigger behavior change right at the moment when the behaviors seem misaligned with goals.
8. Complete RFID Analysis and Forecasts, 2008–2018, www.idtechex.com/research/reports/
9. The Societal Impact of the Internet of Things – BCS
10. "Building Value from Visibility: 2012 Enterprise Internet of Things Adoption Outlook" is a commissioned study conducted by Forrester Consulting on behalf of Zebra Technologies.
11. Internet of Things (IoT) & Machine-To-Machine (M2M) Communication Market – Advanced Technologies, Future Cities & Adoption Trends, Roadmaps & Worldwide Forecasts (2012 – 2017) http://www.marketsandmarkets.com
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