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The Four Concerns That Must Be Addressed Before the Internet of Things Can Really Take Off In 2016

Posted by Rodolfo Saccoman, Nabyl Charania on Mar 26, 2016 |

Sometimes a fridge isn’t just a fridge. Samsung’s smart refrigerator is connected to the internet and allows owners to order food from the supermarket directly from the kitchen. It’s part of the Internet of Things (IoT), an exciting series of technological developments that are set to change the way we interact with machines on a day-to-day basis.

By 2020, there will be more than 50 billion of these connected devices, according to Cisco, and experts predict that the IoT will have a $3.5 trillion impact on the global economy within the next five years. It won’t just be fridges; we’ll see home energy systems, security devices, entertainment products, games, interactive wearables -- the list goes on and on. The question is, is it really going to happen? And shouldn’t we be seeing greater market penetration than we already do?

While the IoT is a hot topic right now, we don’t have the sort of everyday uptake internet experts have predicted. In the grand scheme of things, there really aren’t very many connected watches, thermostats, or accessories. The Acquity Group report that only “7% of consumers own a wearable IoT device, and 4% of consumers own an in-home IoT device”.

This article will look at the things the IoT needs to be on the forefront of the consumer experience, including the value to the consumer, the necessity of a centralized IoT platform, a set of international communication protocols, user education and greater security.

A clear value proposition for the user

The IoT is a network of connected devices with boundless potential, and there is a lot of enthusiasm and buzz among tech and internet experts. However, there are also many who are less sure and have yet to fully embrace the concept. This comes down to the current lack of a universal value proposition - something that gives people a reason to go out and start purchasing and connecting smart devices.

Consumer education is a key part of the mix. Rather than expecting people to understand the need for IoT devices, companies need to get easy-to-use IoT devices into the hands of people to demonstrate their potential.

Browse through the IoT section in any technology store and you will be presented with an overwhelming array of strange, seemingly superfluous devices. Aside from a few useful security devices, it’s not clear what many are for, why we would purchase them, or even how we would begin to set them up in our otherwise unconnected homes.

In order to understand how we will start engaging with the IoT, we should go back in time and take a look at the evolution of the smartphone - and the iPhone in particular - a clear and contemporary precursor to the IoT.

The real value of an iPhone is not in its calling or messaging functionality, but access to a whole range of free and paid applications. However, when the iPhone was first introduced, it was something so novel that it had to be kept simple. Steve Jobs presented only its 3 main features music, calling, web.

When the App Store was eventually launched in mid-2008, users had grown more accustomed to the idea of device versatility and Apple had a much higher degree of quality control over apps.

Through convenience and simplicity, the Android and Apple app stores brought the smartphone to the forefront of the consumer consciousness. Even so, smartphones didn’t have to push very hard to achieve market penetration; mobile phones were already a part of our everyday lives.

When it comes to the IoT, persuading a customer to purchase a smart device is frictionless, if the fact that it is networked simply augments its function. Smart devices themselves should only exist where they truly add value. Connecting your pillow to the internet to measure your sleeping patterns, for example, might sound intriguing, but at the end of the day will probably just become a novelty and make life more complicated.

For a contemporary example, the NEST thermostat learns user behavior, adapts the temperature in the home to suit the residents’ preferences, and automatically turns off the heat when it detects no one is home. It’s greener and more economical, saving hundreds of dollars on electricity every year. The value is obvious to most, and smart objects like this are already finding a willing market.

On the other hand, when it comes to more abstract concepts - like smart accessories and wearables (Google Glass, for example), the public will need more convincing. The inconvenience of wearing them, charging them, even just using them (imagine losing internet access and being locked out of your home as a result), has to be balanced with a huge value proposition.

We need to keep this technology useful, simple, and easy to use. By helping people become accustomed to the new utilities and through the provision of continuous communication and support, we’ll see organic growth in the numbers of consumers connecting their homes and devices.

A centralized platform and APIs

Developers have been the driving force behind the internet and the mobile revolution. However, the current lack of a centralized platform for the IoT currently stymies the sort of growth and creativity we are used to seeing on our mobile devices.

The Android and Apple app stores, for example, have been a hub for experimentation and development. Currently 93% of developers focus on producing apps for smartphones -- and that’s no big surprise; these standardized platforms reduce time to market and also lower risks.

The average cost to develop an app for iOS is reported to be $27,463 USD. If there is a guaranteed outlet for apps, for example, developers know they have a traffic-rich outlet to sell their product.

Producing a commercial IoT device, on the other hand, is far more expensive at around $2.5 million USD, if we take the averages that Canary, SmartThings, Dropcam and Nest raised before they took their products to market. On the other hand, there are lower cost means of creating IoT products, from the likes of Tessel and Onion, but developers with fewer resources and less financial backing still need more of a push to consider a move into smart object app design.

Although manufacturers are coming to realize the importance of inter-device and inter-brand software standardization, they should look towards the smartphone example. A centralized and open source app store will be an important catalyst for further innovation, integration and savings.

However, the issue lies not only in communication, but also in the APIs offered by manufacturers. By allowing new connections, and interactions smart device producers leave their products open to the crowd and swarm creativity. Much like we see in an app store, new developers will come along and take the opportunity to create new uses that have not previously been conceived of.

Who knows, in the future perhaps you will be able to connect your coffee maker to your smartphone wake up alarm, and have your brew ready and waiting when you first stumble into the kitchen in the morning?

Interconnectability and a universal IoT communication protocol

It was forecasted that 50% of North Americans would purchase at least one smart object for their home in 2015. While consumers are increasingly interested in the idea of living the connected life 24/7 in a smarthome, another major issue for IoT developers relates to inter-device compatibility.

Until connectivity is better standardized, consumers will continue to face technical difficulties when trying to get their devices to interact, especially in the home environment where smart objects are very likely to come from a range of different suppliers and have different communication protocols.

Mike Harris, CEO of Zonoff, the developers of Staples’ technology, spoke on the importance of seamless device integration, saying, “We envision a home in which open standards like Wi-Fi, Z-Wave, ZigBee, Bluetooth, and others work seamlessly alongside traditionally proprietary standards like Lutron’s Clear Connect.”

Harris is right, of course, and the big IoT players need to make sure proprietary software and hardware follow industry standards, with a communications protocol that enables devices to talk to each other and share data, whatever the brand.

Security

Not only do people need to understand the whys and hows of the IoT, but they also need to be sure that the devices they are using are secure. This has been a clear concern for many, especially after high-profile hacks on internet-enabled cars.

IoT developers, companies, and customers alike must recognize that every device is a potential target, which is what makes IoT security such a critical issue before it is publicly adopted.

As we saw in the 1990s and 2000s, with computers running Microsoft operating systems, the greater the adoption of a particular platform, the greater the incentive to exploit it. In this era of poor online security, swarms of malicious software targeted internet-connected computers and created the 'botnets' generally used for DDoS attacks.

In much the same way, the IoT space has a few recognized players, with many offering a single device; for example, as Amazon Echo makes its way into more and more households, the more valuable it becomes as a target for hackers.

Fortunately, IoT devices have a limited scope of functionality, unlike a personal computer. This limitation makes it unlikely that a device itself will house the capability or information an attacker is looking for. The real concern is that once a single device is compromised on a network, it becomes much easier for hackers to access other networked devices, as firewalls and obscurity has already been bypassed.

Another security aspect consumers are concerned about regards personal data collection. Without clear policies on data collection, third-party sharing, and the ability to export or delete all stored information, consumer adoption will be limited by fear of capitalistic exploitation.

The greatest power of IoT comes from not what it can do for individuals, but what it can do in aggregate. When we have quantifiable data for a problem, machines can optimize a solution which would simply be impossible for human intuition to discover.

Ironing out these security concerns will not be easy, but we should not underestimate our desire to progress and innovate. Through the digitization of existing products and the networking of new tools and devices, we are going to see fast-paced and unprecedented changes in our schools, homes, and places of work.

Once we have a secure system and a strong value proposition is presented to consumers, and we have access to a centralized platform full to the brim with apps connecting our physical and digital lives, we’re going to see the explosion in use the experts have been predicting.

About the Authors

Rodolfo Saccoman, CEO of AdMobilize and the MATRIX project. AdMobilize is a venture-backed Internet of Things company with the first IoT app ecosystem.

 

 

Nabyl Charania CEO of Rokk3r Labs - a unique platform which partners entrepreneurs with strategists, creatives and engineers to design, build and launch exponential organizations.

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Evolution not revolution by Fredrik Beckman

"The good thing about IoT standards is that there are so many to choose from" :)

The situation today in the IoT market is very much similar to the early days of mobile/cellular communication. Entrepreneurs and telcos invested billions in different standards and technologies preventing people from roaming over different states in the US, and making it impossible to roam internationally. In the end, one standard crushed the competition, GSM. Many reasons for this but I believe that the roaming abilities is a major factor, the necessity to travel extensively between the smaller European countries for day to day business.

We will see the same evolution in the IoT. Interoperability is a necessity as you point out. Industry groups will continue to push their standards that they have invested heavily in, and where they own the patent rights.

My strong belief is that the winner in this standards battle will be something Open Source. Where no single stakeholders own the right and gathers licensing fees from the application and "things" developers. This extra taxation prevents innovation.

The real killer will be the open source or "free" tech that offers interoperability, "roaming", between standards, releasing the innovation power of the application developers. While still provide necessary privacy and security protection. Interoperability, if not implemented right, will provide a massive security issue.

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