A new report from Verizon released today is claiming the Internet of Things is already a mainstream phenomenon, being driven by revenue growth across a number of enterprise categories, and expected to drive services spending of $235 billion dollars. (See Verizon Says IoT Becoming Mainstream.)
The latter figure is a Gartner Group estimate, but IoT is already proliferating across multiple enterprise categories, and will drive two to three times more startup funding this year than consumer applications, according to the Verizon Communications Inc. (NYSE: VZ) report, which you can read here. And while IoT remains a complex environment, that isn't slowing down deployment by enterprises of solutions that work today, the report says.
It cites five major factors that it says are driving IoT, including higher expectations by consumers of what automation will do for them and higher enterprise expectations around monetizing data. Regulatory changes that impose requirements on businesses will also help drive IoT, along with the proliferation of IoT platforms, connected devices and networks and the rise of security implementations, the report states. (You can see more of the report's numbers here. )
Among the platforms it names are Verizon's own ThingSpace plus Google (Nasdaq: GOOG)'s Brillo, IBM Corp. (NYSE: IBM)'s Watson and Cisco Systems Inc. (Nasdaq: CSCO)'s Jasper, although the report admits there are many others. Collectively, they are creating one-stop shops for customers and making IoT simpler to roll out, the report claims.
For its part, Verizon is also publicizing a number of use cases that it says are taking off among enterprises -- which for all of their interest in IoT are still only using a fraction of the data they have on hand.
"We're talking about millions and millions of data points," says Verizon's Tom Villa, director of product management and development. "The challenge has been to take that data and put it in a format that is easy for businesses and customers to use, and for them to see enough value in it to be willing to pay for it."
According to Villa, Verizon is building its overall capabilities in IoT and focusing initially on five key vertical markets: healthcare, energy, transportation, smart cities and agriculture tech. Within each market, the company works with customers to determine what problems can be addressed by IoT solutions and then develops those solutions using ThingSpace and Verizon's networks.
"The data is collected and goes into a cloud that is secure and that is one of our strengths -- the customer has access to the data within the cloud or whatever we are talking about here, and they are the domain experts," he says in an interview. "We don't have the experience to say we know what to look for when it comes to healthcare, transportation or energy that we now see as really good opportunities. We work with those customers and ask them what they need to see, how often they need to see it and if they need to aggregate it in a way that provides alerts based on their criteria. Then we will build all that into algorithms and alert structures for them so they can go ahead and receive information."
Most recently, for example, Villa's group was engaged in developing a solution for the pharmaceutical industry that would address the $75 billion a year in losses associated with prescription drugs that are stolen, go bad or are counterfeited during the manufacturing and distribution process. By replacing RFID tags and periodic scans with real-time tracking of drugs down to a very granular level, a Verizon IoT system is able to better identify if drugs have been damaged by moisture or humidity or if shipments have been disrupted by thieves.
The "track and trace" application is applied to millions of shipments, he says, and covers the process from the raw material stage right through distribution to individual pharmacies, allowing the pharmaceutical companies to meet new regulatory requirements imposed by the federal government to better account for drugs.
Also cited as recent applications were an oyster farm, using IoT to track complex data such as environmental and sub tidal water temperature and chlorophyll values that affect the quality of oysters; individual patient monitoring for health care providers; and a new connected car solution expected soon using LTE.
Verizon also announced that it has hired Mrinalini Ingram from Cisco to lead its Smart Cities initiatives.
On the security front, the key thing is that security solutions for IoT are keeping pace with implementations, Villa says, so that businesses are confident enough with how their data is being protected in storage and in transit to move forward. Verizon is convinced that security concerns won't prevent enterprises from moving forward.
— Carol Wilson, Editor-at-Large, Light Reading