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IoT Startup Banking on WiFi Connectivity

Jason Meyers

Internet of Things (IoT) startup Electric Imp is betting that the established and already well-connected world of WiFi will be the ticket to fast and economical expansion of the IoT ecosystem, both in the home and in industrial environments.

Electric Imp Inc. has built what it calls an end-to-end IoT connectivity platform, consisting of a component featuring a WiFi radio that embeds its Imp operating system into devices and provides a secure connection to the Imp Cloud. The Imp Cloud, the company says, acts as a central hub that provides connected devices with more security and control.

"You can run an application between the device and the cloud, and since there's a real-time connection to the cloud, you have all the computing power of the cloud in your device," says Bryan Kennedy, VP Strategic Development for Electric Imp. "Everything in the device is operating on a virtual machine in cloud, so you have complete and constant visibility to what's going on in the device."

The embedded WiFi radio in the Electric Imp component is a distinctive part of the strategy, Kennedy says. Relying on WiFi for connectivity moves devices out of the traditional M2M model of needing cellular connectivity, he says, and Electric Imp's WiFi-based approach is one-tenth the cost of a 3G/4G solution -- and addresses security implications that other networking standards can't.

Besides which, Kennedy adds, "working with the carriers reminds me of the old Soviet Union."

"WiFi has become so ubiquitous, and cost is dropping like a rock," he says. "More importantly, WiFi has been around long enough that security is rock solid, where Bluetooth is Swiss cheese. It's easy for us to change our radios out, but that market is so huge, so cost-effective and so secure, we're going to stay running in it for quite a while."

As for the whirr of activity in new IoT standards group formation, Kennedy said he believes it will take years for that to coalesce, and that protocols like Z-Wave and ZigBee are "doomed" and will quickly become the stuff of legacy. (See Raco Aims to Eliminate Need for IoT Standards, AllSeen Attracts More IoT Hopefuls and Thread Group Spins New IoT Networking Protocol.)

Get the latest on the evolution of connected things by visiting Light Reading's dedicated IoT content channel.

Electric Imp recently landed $15 million in Series B funding from new investors Foxconn Technology Group, PTI Ventures and Rampart Capital, and returning investor Redpoint Ventures . Company co-founder and CEO Hugo Fiennes, who was involved early on in the development of the Nest thermostat ultimately acquired by Google (Nasdaq: GOOG), was also a returning investor. The new funding adds to the $8 million Series A investment the company closed in 2012.

The company started out in the home automation space, but is now looking toward products that have longer lives and into industrial manufacturing.

"Home automation has fast time to market, but limited shelf life and margin-sensitive products," he says. "White goods and appliances -- fridges, washing machines, pool pumps -- are much more expensive, and they tend to have five to 10 year asset lives. Once you connect you are guaranteed a service contract."

Getting embedded into those kinds of products also provides the company with a natural outgrowth into products for commercial and industrial settings, he says.

"When we knock off the business unit that does AC in the home, we have a reference in the same company and we're already a vendor," he says. "Then it becomes a much easier for them to implement our technology into their commercial and industrial product lines."

— Jason Meyers, Senior Editor, Utility Communications/IoT, Light Reading

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User Rank: Light Beer
8/27/2014 | 6:01:56 PM
Re: Is it safe?
@Liz G,

That's cool. My ISP hasn't even sniffed that type of functionality yet. They probably reserve those luxuries for the business class paying customers :(
Liz Greenberg
Liz Greenberg,
User Rank: Light Sabre
8/27/2014 | 1:11:11 AM
Re: Is it safe?
@pcharles09 my internet provider Sonic.net provides a Cisco client for us to use.  I use it on my laptop and I am trying to use it on my phone- still working the configuration issues. A huge benefit when traveling overseas, is that my IP is a US domestic address which means I can access Netflix, banking etc. easily and safely.
User Rank: Light Beer
8/27/2014 | 12:28:09 AM
Re: Is it safe?
@Liz G,

Is it a corporate tunnel or something you use personally? If yes to the latter, which one do you use?
User Rank: Light Sabre
8/26/2014 | 10:56:13 PM
Re: Security!
Sounds like they are taking security seriously, but still unproven in the IoT space. We will have to wait and see.
User Rank: Blogger
8/26/2014 | 8:27:24 PM
I asked Electric Imp to weigh in on these security concerns. The following response is from Tom Sarris, the company's communications manager: "We understand the concerns about Internet security, as well as security within the IoT space as a whole. The Electric Imp platform is aimed at removing the challenges and roadblocks designers face when creating new connected devices. We believe security is a requirement and not an afterthought. Security has been considered at every level of the Electric Imp platform from the chips in the hardware to the cloud services. The imp hardware supports WiFi networks with WPA and WPA 2 Personal security and uses TLS/SSL encryption for all communication between the device and server. To help further ensure security during the setup process, our platform features a patent pending optical setup configuration called BlinkUp, which allows network credentials to be passed to a device without broadcasting them over the air."
Liz Greenberg
Liz Greenberg,
User Rank: Light Sabre
8/26/2014 | 5:24:18 PM
Re: Is it safe?
All I know is that I run a VPN whenever I can if I have to use public WiFi...I think that swiss cheese applies to most wireless technologies.  If these guys have some way to lock it down great but ubiquity will be important or it is still swiss cheese.
User Rank: Light Sabre
8/26/2014 | 1:25:13 PM
Re: WiFi security
This model sounds like an expansion of the Chromecast topology.   

Chromecast is a Wifi connected device that runs video in two ways.   Triggered by an app but streamed directly from the Google Cloud.  Or in a roundabout way, where you stream it normally to a PC and then send it back up the Wifi to Chromecast.

In any case, I've read that some Chromecasts have been hijacked since they broadcast themselves using Wifi!  

Chromecast Hack Lets You Rickroll Your Neighbor's TV

Dan Petro built a "Rickmote Controller" that can hijack a Chromecast, and play an endless loop of Rick Astley's "Never Going to Give You Up."
User Rank: Light Sabre
8/26/2014 | 12:45:30 PM
Re: Is it safe?
WiFi is a great technology for connecting devices, but security is a fundamental issue with WiFi so I would be very concerned. 
User Rank: Light Sabre
8/26/2014 | 10:48:46 AM
Is it safe?
I know there's security built into this approach, but is WiFi really to be trusted with IoT apps?
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