By Paul Brody
As the Internet of Things starts to accelerate, the practical realities of running networks of devices that number in the billions and tens of billions are becoming a major focus.
We are already churning out more than a billion new smartphones every year and in all likelihood we will soon be faced with the task of managing more than 100 billion connected devices sometime in the next decade or so.
Future Internet of Things networks will have many more devices connected and interconnected and they’ll likely last for much longer periods of time than current ones. Also, more sophisticated than sensors, future devices will be asset management tools and active participants in all kinds of online market places. In short, the Internet of Things doesn’t just mean contending with more devices, it means dealing with increasing amounts of work being executed on those devices, as well.
In a new paper on the future of the Internet of Things from the IBM Institute for Business Value, we outline three things that the technology industry must do to both scale up the Internet of Things and realize its benefits.
First, we need to find technologies that will help us extend the cloud model to one that has lower costs and serves more devices. One of the most interesting candidates for this role is the Block Chain. This technology, which underpins bitcoin, is the focus of a new proof of concept that we are exploring to test its applicability to the Internet of Things.
Two, we need to find sources of economic return within the Internet of Things. As we instrument and connect the physical world every “thing” has the potential to participate in real-time digital markets and payment systems. Some of these markets will be financial, but many others will involve the sharing of resources to improve the efficient allocation of commodities like solar energy, bandwidth, compute cycles and storage capacity.
One of the important things devices of the future will do is to participate in marketplaces without human intervention. Based on rules and access to supply and demand information, devices will increasingly make autonomous decisions about how to share resources and adjust their own demand, making these markets frictionless and invisible to everyday users.
Third, we must figure out the design challenges of a digitally-enabled world. Economic research has shown time and again that the productivity benefits of new technology have been very slow to take hold. Better user experience design is not just nice for users, it’s essential to making the interaction between online experience and the physical world seamless and simple, and then, to unlocking productivity gains much faster.
Today only about half of the global economy operates in industries that could be considered IT intensive, that is, industries that have been easy to digitize and bring online, like banking or air transportation. For many others, like farming or real estate, the “out of the office” nature of the business means that the productivity gains of computing have been far lower.
As the Internet of Things matures, now is our chance to change that.
More on this point of view can be found in IBM’s new paper on the future of the Internet of Things. The paper lays out our views about how the networking, services and economics of the Internet of Things may evolve. In parallel with the paper, we are working on a proof of concept for Internet of Things networks that is based on the Block Chain and a set of economic models that show which industries are most likely to benefit from IoT investments and in what ways. The follow-up studies will be released in early 2015.