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Cars, Cities & Pet Trackers: IoT in 2015

Dan Jones
2/12/2015
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Here's the thing about the Internet of Things: It may already be well hyped, but we're still right at the beginning of a world where every kind of device or appliance in a home, city or business could be on the network and talking to other machines.

The Internet of Things (IoT) is not a new concept. Kevin Ashton is generally credited with coming up with the idea of a world where everything from household appliances to water meters are networked and sending out data back in 1999.

It is only really in the last year, however, in the communications space, that we have started to see carriers making initial forays into IoT devices and applications. AT&T Inc. (NYSE: T), for instance, says that it added 800,000 cars with 3G and 4G connections onboard in the fourth quarter of 2014. Verizon Communications Inc. (NYSE: VZ) said it made an annual revenue of $585 million from its IoT and telematics business, which centers on the tracking of vehicle fleets and goods. (See AT&T Highlights Mexican Ambitions.)

Connected vehicles and related services and applications appear to be the largest addressable market opening up for carriers and vendors in the comms space right now. Qualcomm Inc. (Nasdaq: QCOM)'s CTO, Matt Grob, told me in January that he expects that to be the most important individual IoT market for his company in 2015. (See Verizon Vehicle Races to Catch Up to OnStar.)

There are reasons for this. Firstly, operators, vendors and car makers have been working towards connected cars for years now. An automobile or a truck is also an easier object to embed a radio in than, say, pet trackers or smart sensors, and the power and battery life concerns are less in a vehicle. Of course, once you get beyond simple connectivity and applications, designing operating systems and apps for safe driving in cars becomes an art in itself. (See CES Pics: Cars, Drones & Lines, Oh My!)

But the IoT concept goes way beyond cars and is starting to spread like The Blob into all kinds of sectors. Fitness monitors and pet trackers are already on the scene, with plenty of startups exploring security and monitoring options for "smart home" scenarios.

Expect further networked options to become more common for healthcare applications, smart cities, and factory and agriculture automation. Indeed, you can already see networked trash bins on the streets of New York and other cities around the world. (See NYC: Inside the Internet of Bins.)

To facilitate that expansion, the industry needs standards to define how devices communicate with networks -- and in some cases -- each other. Battles over specifications and standards between vendors and carriers are likely to rage throughout 2015. I suspect we'll end up with multiple standards that address different areas of IoT. How your fridge talks to the network is unlikely to be in the same language as elements of an automated production line in a pharmaceuticals factory. (See AllSeen Tries to Streamline IoT Standards.)

Security is another big issue. Obviously you don't want hackers taking control of your home or your car remotely via networked devices. (See Could Hackers Take Over Your Home?)

Additional privacy concerns could also arise. Fitness and mHealth devices can track extremely private data, for one.

Advances in power efficiency and battery life will probably make IoT implementations easier too. Some devices, like smart power meters, could be installed for decades in the field so the lowest current draw possible for longer battery life is desirable.

How much of the Internet of Everything actually needs to be connected will eventually become a question too. Does a toaster need to talk to a fridge, for instance? Although we're not at the point where this is a pressing issue yet.

Despite such issues, though, there's little doubt that 2015 is the year the connected car will start to lead us further down the road to a fully fledged Internet of Things.

— Dan Jones, Mobile Editor, Light Reading

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jasonmeyers
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jasonmeyers,
User Rank: Blogger
2/12/2015 | 8:06:33 AM
What's driving the future of the IoT
Connected cars definitely are generating a lot of the IoT hype and photos on the topic of IoT, but that doesn't do justice to the critical importance of areas like industrial M2M/IoT applications, home security/automation, smart cities and the IoT potential that exists across a wide range of vertical sectors -- particularly as it pertains to service provider strategies for playing a prominent role in the IoT sector and generating revenue. It's important to note that service providers run the risk of being relegated to being providers of connectivity if they aren't developing comprehensive, forward-looking strategies that take all aspects of the IoT -- from device to application enablement to security to connectivity to data collection and analytics. 

For service providers, the money will come (if it comes) from large-scale IoT deployments that bring millions of devices onto their networks, along with the data all those connected devices will generate -- starting in the broad sectors like smart cities, energy and intelligent transportation, and moving deeper into vertical sectors that require more application customization. They need to have the ability to quickly and cost-effectively manage application enablement for large and small enterprises, cities and mass consumers -- getting devices deployed and secured en masse, showing enterprises that they can manage the services, ensuring and monintoring security across the board, and making sense of all the data those devices will generate for their customers.

If they're just providing the network to transport the data, they'll be a dumb pipe. Regardless if the connected devices in question are cars, medical wearables, industrial machines or streetlights, their role in the IoT will quickly become commoditized. 

 

 
DanJones
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DanJones,
User Rank: Blogger
2/12/2015 | 1:08:35 PM
Re: What's driving the future of the IoT
Sure there's a lot of critical work going on in other areas, but if operators are making money or gaining connections/subscribers in those areas they sure aren't breaking that out yet. But the two biggest carriers in the US on their Q4 calls *did* highlight connected car connections (AT&T) and 45% growth y-on-y in telematics. 
mendyk
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mendyk,
User Rank: Light Sabre
2/12/2015 | 2:50:17 PM
Re: What's driving the future of the IoT
High-percentage early-stage growth is the rule, not the exception. The key issue will be significant revenue growth and, more importantly, profitability. The challenge with connected cars is that the carmakers are eyeing the same potential money pile.
DanJones
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DanJones,
User Rank: Blogger
2/12/2015 | 3:19:45 PM
Re: What's driving the future of the IoT
Of course, none of the carriers are purely focused on connected cars (although AT&T has decent headstart to my eyes). They're all working on smarthome, smart city and mHealth applications in the lab and field. Connected car and telematics is pushing the needle at the moment though.

 

Don't forget that Apple and Google are trying to horn in hard on the Connected Car market too.
mendyk
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mendyk,
User Rank: Light Sabre
2/12/2015 | 3:24:44 PM
Re: What's driving the future of the IoT
Well, yeah, this is the problem. We've been through these kinds of gold rushes before. More often than not, the rushers end up with a fistful of pyrite.
kq4ym
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kq4ym,
User Rank: Light Sabre
2/15/2015 | 10:53:26 AM
Re: What's driving the future of the IoT
There will surely be some fool's gold in the mix as folks seek out the profit potentials in IoT. But, that's pretty much true of any new technology as the glimmer of fresh ideas captures the minds and pocketbooks of investors and dreamers alike.
mendyk
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mendyk,
User Rank: Light Sabre
2/16/2015 | 10:21:17 AM
Re: What's driving the future of the IoT
Some companies have the cultural background and tacit approval (or is that expectation?) from "investors" to launch exploratory initiatives that are likely to fall short of commercial success (iCar, anyone?). I don't think network operators fit that profile. They are historically risk-averse, and they are likely to incur the wrath of their conservative investor base if they travel too far down a development rabbit hole without realizing a direct payback.
Phil_Britt
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Phil_Britt,
User Rank: Light Sabre
2/17/2015 | 7:32:02 AM
Re: What's driving the future of the IoT
I think you're spot on with your fool's gold comment. Connected cars, no question. Connected utilities, probably good. Connected watches, OK (though I don't foresee ever buying one myself). But other stuff, not so much -- though some will see "connected" as golden, just was "dotcom" was considered golden before the dotbomb crash of 1999-2000.
DanJones
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DanJones,
User Rank: Blogger
2/17/2015 | 9:07:12 AM
Re: What's driving the future of the IoT
I suspect home security and sensors could be a good niche.
jasonmeyers
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jasonmeyers,
User Rank: Blogger
2/12/2015 | 3:49:48 PM
Re: What's driving the future of the IoT
Telematics defined as what?
DanJones
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DanJones,
User Rank: Blogger
2/12/2015 | 3:59:24 PM
Re: What's driving the future of the IoT
They just said telematics on the earning call but Verizon is big into fleet tracking etc.

 

See: https://verizontelematics.com/
fergie1965
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fergie1965,
User Rank: Light Beer
2/14/2015 | 9:31:44 PM
Re: What's driving the future of the IoT
Self drive vehicles is a very interesitng topic..big challenges ahead

1) will cars communicate directly with each other or send data up to the cloud (for example, if a pothole appears, should that car communicate directly other cars in area or up to the cloud

2) If you assume all self drive vehicles are sensible, how will the world of self drive and cars being driven by crazies work out?

3) How much information should be stored locally (think about bad areas of cellphone coverage etc) versus up in the cloud

4) If you drive across Europe, all the networks must play nice to provide a seamless experience from country to country. How does that work out in terms of billing, information sharing etc

Etc

 

Regards

Ian
kq4ym
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kq4ym,
User Rank: Light Sabre
2/12/2015 | 3:22:17 PM
Re: What's driving the future of the IoT
I would agree that getting millions of the devices connected is going to be the key. The auto and transport industry is most likely the low hanging fruit at the momemt. There's no problem with powering the devices and lots of space to install them, not so easy to get those pet trackers into a similar mass market situation not to mention the auto devices can be varies so much in capabilities that new markets can open relatively quickly based on them. 
mendyk
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mendyk,
User Rank: Light Sabre
2/12/2015 | 3:26:03 PM
Re: What's driving the future of the IoT
I would argue that pet trackers are probably an easier opportunity than connected cars. iPooch, anyone?
DanJones
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DanJones,
User Rank: Blogger
2/12/2015 | 3:37:41 PM
Re: What's driving the future of the IoT
Once you get to small tags you get limited to Bluetooth or Zigbee for connectivity though. The cellular radios eat the battery. So yeah, consumer electronics folks are already getting into that market, its quite popular already, but probably not super interesting for operators yet. Certainly the technology will shrink down and get better over time though.
mendyk
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mendyk,
User Rank: Light Sabre
2/12/2015 | 9:49:08 AM
IoP
I'm looking forward to our first IoP (Internet of Pets) event. Maybe we can co-locate it with DroneComm.
DanJones
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DanJones,
User Rank: Blogger
2/12/2015 | 1:09:18 PM
Re: IoP
Meeee toooooo!

 

PetNet 2016?

 
DHagar
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DHagar,
User Rank: Light Sabre
2/12/2015 | 4:10:04 PM
Re: What's driving the future of the IoT
Dan, good article.  In addition to the cars being a major market opportunity, I agree with your identification of both healthcare and smart cities.  I am seeing that when IoT becomes a "solution", by being able to connect communications that are needed and desired, it seems a very natural development.

If you get several forces driving at the same time, it can develop the market - although the pets may unite yet!
DanJones
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DanJones,
User Rank: Blogger
2/12/2015 | 5:00:34 PM
Re: What's driving the future of the IoT
I would expect to see some advancements around point of sales stuff in retail and location tracking in stores too.
DHagar
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DHagar,
User Rank: Light Sabre
2/12/2015 | 5:45:28 PM
Re: What's driving the future of IoT?
Dan, that makes great sense.  I am working with some cities that are also looking at "smarter" distribution and fulfillment centers as well.  The whole supply chain management is lining up also.
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