We’re already well into 2016 and I haven’t found time yet to write my conclusions on the IoT year of 2015. The reason is simply that IoT remains incredibly hot and moves forward with great force in all possible fields and directions. But let’s start looking at where in life IoT is now using the criteria for a grown up IoT industry which I have used for the last few years: solid participation from the IT players, a hot M&A market, active and seriously engaged enterprises and efficient easy-to-use prototyping tools for users of IoT.
The IT players
, and I mean all of them, are now fully involved in the IoT opportunity. Big Data is now the name of the game and analysts are estimating trillions of dollars opportunities ahead here and there. IBM, SAP, Cisco, Microsoft, Ericsson, Amazon and all the others are jumping on this train and even good old Watson has found a new home. Every single consulting firm I know of are now experts on IoT and so are the app makers, cloud providers and management consultants of the world. So yes, the IT players are there. Check.
The M&A market for IoT
is definitely hot. Following the earlier grand deals by Google, Samsung, PTC and others came a huge amount of M&A deals by VC’s, enterprises, hardware vendors, software platform vendors, telecoms vendors, operators and so on. And the most recent unicorn style acquisition by Cisco acquiring Jasper for 1,4B$ makes the point loud and clear.
Accredent just wrote: "IoT M&A activities continued to accelerate as technology and non-technology companies try to stay ahead of competitive disruption, acquire talent and pursue the partners needed for end-to-end strategies. As of the last fully reported quarter 3Q15, there were 114 IoT deals (compared to 56 for all of 2014) with a total value of $31.9 billion (compared with $13 billion for full-year 2014)”. This as well makes the point large and clear! Check.
I also believe we’re at the point where enterprises
across industries have become active and seriously engaged. Some companies have taken the lead in their industry and by now presented pilots or commercial offerings, while most others have at least recognised the importance of looking at IoT and in many cases started plan and prototype. It’s also interesting to see that many enterprises have recognised the opportunity of horizontal expansion into adjacent business areas enabled by IoT. This has caused some old partnerships to be challenged - friends of enemies? - and some morning coffees to be ruined by unexpected surprises. And we will see much more of this moving forward. How many companies do you know offering people to sleep well in the night for example? A solid evidence for enterprises starting to move is all memberships in technical alliances. Industrial Internet Consortium
for example now has 229 members. Another good sign is that there was yet another IoT category at the Swedish Mobile Awards lately: best enterprise use of IoT. The nominees were the real estate company Riksbyggen using drones for inspections, Assa Abloy for their very active participation in the IoT industry and innovative use of IoT, Scania for having connected 170 000 trucks by now and SKF with their connected bearings. And the winner was…. Scania! Very well deserved recognition for a large, innovative and well managed connected car service. Check.
The easy-to use tools for rapid prototyping and testing
were already in place a year ago with things like TI Sensor tags, Beacons, Thinking Things, Evothing Studio. Check.
With all criteria met I believe our baby just went from late teenage to grown up but young - hungry, eager and full of energy and ideas, ready to change the world, but not experienced enough to avoid a lot of mistakes. She continues to grow faster than we have seen anything grow before why we will reach Plateau of Productivity as Gartner calls it, ahead of schedule. Three years from now we will not even talk about IoT, IoE or M2M - it’s just internet again. A sign of that is that IoT events are evolving from generic to vertical - smart cities, automotive, industry 4.0, healthcare, fashion, logistics and so forth. Accordingly I think 2016 is the last year there will be an IoT hall at MWC. Interesting enough, operators are now changing their scope from M2M to IOT. That's about time since it is all about Internet.
Sweden remains a great place to look for IoT experience and solutions and my alliance for Swedish IoT start-ups
now has 51 members (35 a year ago) and 17 partners. Many of the members are making great international commercial progress by now including companies like Kombridge, ShortCut Labs, Maingate, Springworks, Narrative, Ngenic, WSI, Connode, H&D Wireless, Yanzi, Info24 and IoT Platform of the year winner Infracontrol. And accordingly SMSE
get more international partners like Telefonica and M2M Alliance which is very valuable for the start-ups and their route to market. During last year we also opened a hardware hub in Stockholm
to address the special challenges in IoT, wearables, automation, 3D scan/print and robotics that start-ups and large export companies share. Today we have some 30 start-ups and industry partners like ABB, Assa Abloy, Husqvarna and NCC at THINGS
all working together to find the best way to overcome the hardware challenges and transforming entrepreneurial innovation to value creation through large international organisations.
So which will be the key issues moving forward? I believe the Narrow Band Networks for IoT, LPWAN, will be a hot topic 2016. They just went from not needed to an obvious part of the IoT infrastructure. I just visited a packed NB-IoT Summit in Barcelona which is all about GSMA and their operators and vendors to try catch up with Sigfox and Lora. The LPWAN is really good for all of us and the winner will be the ones attracting the developers.
The two main challenges for IoT are security and privacy
. And the smaller of the two is security. We have learned to live with security issues and as soon as someone steels a couple of million passwords or credit card credentials we get upset but forget, and the security weakness is of course taken care of immediately. The involved companies and brands take a hit but normally survive. Privacy is a completely different animal since it’s a moving target and nobody knows what the policy-makers and public will require in the future. But the key difference to security issues is that the future privacy requirements can’t be met unless one have an architecture supporting consumers owning the data they create and a trusted partner involved.
Remember that the key difference between when Internet of people and organisations was created and now when we are adding things to the Internet is that ignorance will not be an acceptable excuse. So lets get going!