By
George Deeb
I
recently completely a deep dive on the Internet of Things (IoT) space for one
of my Red Rocket clients, and I was blown away with what I learned.
If we think the consumer internet as we know it is a big deal, IoT will
become an even bigger deal, over time. Gartner predicts the IoT industry
to be $1.9TN in size by 2020, and McKinsey thinks it could be as large as
$6.2TN by 2025, in terms of economic impact. Yes Trillion!! Intel
forecasted 15BN devices were already connected to the internet in 2015 alone.
That’s a lot of demand for embedded smart modules, cloud computing,
connectivity, data security, mobile apps and analytics reporting alone.
To
be clear, when I talk about IoT, I am largely talking about devices connected
to the internet (e.g., think a Nest thermostat), or Machine-to-Machine (M2M)
technologies. IoT applications run across these primary sectors:
Consumer, Commercial, Industrial, Buildings, and Government. And,
get further segmented across these major industries: Retail,
Transportation, Security/Safety, IT, Manufacturing, Automotive, Energy and
Healthcare, to name a few. Research suggests Manufacturing and Healthcare are
the largest two of these industries, in terms of potential and investment to
date. From there, it drills down even further. For example, in the
Security/Safety space, it splits out into Real Time Alerts, Asset Tracking,
Fire Safety, Environmental Safety, Elderly/Child Protection, Power Protection,
Supply Chain Visibility and beyond.
So,
don’t try to be all things to all people, find your sizeable niche and dominate
it.
Understanding
a lot of big companies are also carving out their niches. As examples, in
just the smart home space, niches are being created around lighting control
(Hager, Legrand, Leviton, Lutron, Matsushita), access control (Honeywell,
Siemens, Tyco, UTC), connected home security (Alarm.com, Bosch, Kwikset),
energy efficiency (Belkin, Nest), home automation (e.g., Smart Things) and
appliance control (GE, LG, Maytag, Samsung). So, even if you pick a good
niche, odds are some big companies are already trying to figure out solutions
in that space.
And,
with this kind of next-generation market opportunity, it is attracting a lot of
investment from a lot of big players. In terms of financial investors,
over $1.6BN was invested into IoT companies by venture capital firms in 2014
alone. And, as for strategic players putting a lot of investment into IoT
opportunties, it is an impressive list of expected companies, including Apple,
AT&T, Bosch, Cisco, Eaton, Emerson, Ericsson, Fujitsu, GE, Google, Hewlett
Packard, Hitachi, Honeywell, IBM, Intel, Johnson Controls, Lantiq, Microsoft,
NEC, Oracle, Phillips, PTC, Qualcomm, Rockwell, Schlumberger, Schneider
Electric, Siemens, Texas Instruments,Tyco and Verizon, to name just a few.
So, get ready for a slug fest from a lot of well-funded companies that are also
trying to get their piece of the overall IoT pie, across all industries. These
will most likely be the companies you sell your successful IoT startup, down
the road.
The
IoT is going to change everything. In your homes, lights will
automatically turn on and off as you drive your car in and out of your
driveway. In buildings, fire departments will exactly know who is in the
building and where they are, in case of emergencies. In corporate
offices, window shades will automatically open and close based on the weather,
to save on energy costs.
In
restaurants, food will be re-ordered based on how many times the refrigerator
door is opened or closed. In logistics, police will be immediately
notified if trucks veer off course. In healthcare, drones will deliver
medical supplies faster than ambulances. In factories, data from parts usage will
predict when a machine will break, and automatically order the part and a
repairman before it does. As you can imagine, life in 2026 will look materially
different than it looks in 2016, as the pace of technology change accelerates,
thanks in large part to the coming IoT boom.
So,
if you are a startup looking to hitch your wagon to a rising tide, grab the
coattails of the coming IoT tidal wave, and hang on for the ride of your life.
**Culled
from forbes.com
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