IoT 2020 Business Report

Dubai – MENA Herald: Schneider Electric, the global specialist in energy management and automation, recently unveiled its IoT 2020 Business Report, outlining the company’s predictions for how large organizations will leverage Internet of Things technologies as a serious business tool by 2020.
The GCC region has been steadily investing in enhancing IT capabilities and digital readiness and has been known for its widespread adoption of cloud technologies. Similarly, the region’s forward-looking governments have been quick on jump to the IoT bandwagon to help its industries, cities and people live a better connected, safer and greener life. According to International Data Corporation (IDC), the total IoT spending in the Middle East will reach $1.8 billion in 2016 and then increase to $3.2 billion by 2019, with manufacturing, transportation, and utilities accounting for up to 50% of this total. Vendors and solution providers must be quick to adapt their offerings to be compatible with the IoT, as it provides visibility to ensure proactive management of assets and can propel the region’s vision to design intelligent and eco-friendly cities.
“We’re past the point of questioning whether IoT will deliver value. Businesses now need to make informed decisions to position themselves to maximize IoT’s value in their organization,” said Dr. Prith Banerjee, Chief Technology Officer, Schneider Electric. “Our IoT 2020 Business Report is designed to serve as a guide for IoT implementation and innovation to help customers reap its benefits as the market evolves over the next five years. It reflects our commitment in delivering technologies that ensure Life Is On everywhere, for everyone, at every moment.”
Based on a recent global IoT survey of 3,000 business leaders in 12 countries, in addition to Schneider Electric’s expertise with IoT solutions and feedback from its customers and partners, the predictions showcase the immediate value for both the public and private sector.
Dr. Banerjee added: “The Internet of Things has been at the top of the hype curve for some time, but the findings of this survey demonstrate that IoT technologies can and will continue to drive real business value across industries and geographies.”
The following predictions serve as a guide for what business leaders can expect as the market evolves:
1. The next wave of digital transformation. IoT will trigger the next wave of enterprise digital transformation, unifying the worlds of OT and IT and fueling a mobile and digitally enabled workforce: As more companies both expand and deepen their digitization programs enterprise- wide, IoT will increasingly take center stage. This new wave of transformation will be enabled by more affordable “connected” sensors, embedded intelligence and control, faster and more ubiquitous communications networks, cloud infrastructure, and advanced data-analytics capabilities.
2. Insightful data. IoT will translate previously untapped data into insights that enable enterprises to take the customer experience to the next level: When thinking about the value proposition of IoT, most businesses point to efficiency and cost savings as the key benefits. Yet access to data – including previously untapped data – and the ability to translate it into actionable insights, the hallmark of IoT, will deliver greater customer-service transformation and new opportunities to build brand/service loyalty and satisfaction.
3. Premise-to-cloud confidence. The IoT will promote an open, interoperable and hybrid computing approach, and it will foster industry and government collaboration on global architecture standards that address cybersecurity concerns: While cloud-based IoT solutions will grow in popularity, no single computing architecture will monopolize their delivery. IoT instead will flourish across systems, both at the edge and on premise, as part of private cloud or public cloud offerings. Making IoT available across heterogeneous computing environments will help end users adopt IoT solutions in the way that best suits their security and mission-critical needs while also offering entities with legacy technology infrastructures a logical and manageable path forward, allowing them to transform over time.
4. Innovations that leapfrog existing infrastructure. IoT will function as a source of innovation, business model disruption and economic growth for businesses, governments and emerging economies: Just as the Industrial Revolution, birth of the Internet and mobile revolution have driven advancement, innovation and prosperity, so will IoT. Businesses and cities alike will deliver new IoT-enabled services; new business models will emerge; and, in particular emerging economies will have a significant opportunity to quickly leverage IoT without the constraint of legacy infrastructure, essentially leapfrogging old ways. In fact, McKinsey forecasts that 40 percent of the worldwide market for IoT solutions will be generated by developing countries.
5. A better planet. IoT solutions will be leveraged to address major societal and environmental issues: IoT will help countries and their economies respond to the biggest challenges facing our planet, including global warming, water scarcity and pollution. In fact, survey respondents identified improved resource utilization as the number one benefit of IoT to society as a whole. In concert with the private sector, local and national governments will embrace IoT to accelerate and optimize current initiatives to curtail greenhouse gas emissions in accord with the breakthrough COP21 climate agreement, whereby 196 countries pledged to keep global warming under the threshold of 2 degrees Celsius.
The key global survey findings that informed the predictions revealed:
• Seventy-five percent of businesses are optimistic about the opportunities the IoT presents this year, including:Improved customer experience: Sixty-three percent of organizations plan to use the IoT to analyze customer behavior in 2016, with faster problem resolution, better customer service and customer satisfaction ranking among the top five potential business benefits.Cost savings in automation: Building and industrial automation represent the highest potential annual cost savings (63 and 62 percent, respectively). Results showed automation technologies will be the future of the IoT, with nearly half (42 percent) of respondents indicating that they plan to implement IoT-enabled building automation systems within the next two years.Mobile delivers the value of IoT: Two out of three organizations (67 percent) plan to implement the Internet of Things via mobile applications in 2016. Even further, one- third of respondents (32 percent) plan to start using the IoT in mobile applications in as little as six months, citing potential cost savings of up to 59 percent as a major driver in implementation.
• 81 percent of respondents feel that knowledge gathered from the data and/or informationgenerated by the IoT is being shared effectively throughout the organization.
• 41 percent of respondents anticipate cybersecurity threats related to the IoT as being a critical challenge for their business.

CUSTOMERS REPORT GREATER SATISFACTION WITH SMART HOME SERVICE PROVIDERS THAN DEVICE MANUFACTURERS

Smart home service providers like Vivint, Alarm.com, and Xfinity Home are getting more positive online reviews than smart home devices makers, according to a new report from Argus Insights. This shows that customers prefer to have a service provider who comes in and installs their smart home devices for them.

The report analyzed more than 56,000 online and social media reviews of smart home devices and apps. Looking at the app reviews, Vivint’s Sky app had the highest satisfaction rating in the report. Other service providers including Xfinity Home, Alarm.com, and Cox Communications are all seeing improving app satisfaction and subscriber growth, according to Argus. In comparison, smart home apps from device makers like Nest, Philips, and Belkin are lagging behind in satisfaction, the report found.

The big difference between the service providers and individual device makers is that the service providers will install customers’ devices for them. When consumers buy an individual smart home device like a Nest thermostat they have to setup and install the device on their own.

Unfortunately, many smart home devices are plagued with technical glitches that can make installing them very difficult for the average consumer. If a customer is experiencing technical problems with their device, it will likely reflect on their satisfaction with the app that controls that device. So smart home service providers are carving out a space for themselves in the nascent smart home market by solving this technical challenge for customers.

The vision at Bosch: over 200 million smart-connected households by 2020

Peter Tyroller, member of the board of management of Bosch Group responsible for Asia Pacific

GERMAN industrial giant Bosch earlier this month launched a connectivity strategy for China, its second-largest market. Its broad range of businesses and technologies — from automotive, consumer goods, building and energy efficiency solutions, and industrial products and solutions — provides a natural resource for the exploration of connected mobility, connected industries, smart homes and smart cities.

It’s product eco-system is in tune with the rapid growth of the Internet of Things in China, thanks to the government’s Internet Plus initiative for integrating the Internet into traditional industries.

Having just achieved record-high sales in China of 77 billion yuan (US$11.7 billion) last year, despite a slowing market, Bosch predicts strong momentum in sales of connected solutions and services.

Peter Tyroller, a Bosch board member responsible for the Asia-Pacific, shared his company’s vision of “connected for life” at a press conference in Shanghai during the Asia Consumer Electronics Show.

Q: Talk about smart homes and smart cities has been going on for years. Turning talk into reality is another matter. Are these ideas still ahead of their time?

Tyroller: It’s a pretty expansive debate, with everyone fielding their own ideas. What matters lies in the detail. For example, with connectivity, Bosch runs an active parking management system that draws on data collected by sensors installed in the pavement of parking spots to record availability. And for buildings, connectivity of all kinds of devices helps boost energy efficiency within a more integrated system. The Internet of Things takes shape step-by-step.

The market for all these visions may not yet be all that large, but people nowadays seem to be willing to spend extra money on connectivity solutions if they bring costs down. We expect some 230 million households to be “smart connected” by 2020 globally.

This will not be a repeat of the dotcom bubble of the early 2000s. Communication technology is much better developed today, and the Chinese government is sparing no effort in upgrading infrastructure that will lead to the 5G era.

Q: Bosch claims to be the only company with a whole package for the Internet of Things, the sensor, the software, and the service. Which part of your specialty do you see as the strongest growth point?

Tyroller: It is hard to see any of them as a stand-alone business because their power comes from cooperation. Sensors are the eyes, ears and noses, software is the brain, and services are deliveries of value. We have a very strong presence in the hardware field, with three out of four mobile devices in China equipped with Bosch sensors.

We are actively developing data mining and analyzing capabilities as our soft skills. In 2015, 30 percent of the 5,500 Bosch researchers and developers in China were working in software development, and this year over one-fifth of our recruitment of university graduates in China will be related to software. We have a target to connect every product we are selling now with the Internet, compared to the current 50 percent. We have a natural reason to explore the idea of smart homes and smart cities because we ourselves make home appliance and supply building and energy solutions.

Q: A Chinese Internet company called LeEco has the strategy of selling hardware cheaper than cost to attract more users into its product eco-system, where they pay for more value-added services and content. What’s Bosch’s opinion on such a bold business model emerging with the Internet of Things?

Tyroller: The Internet of Things will certainly broaden the traditional way of doing business. Will we make our sensors free and charge for services? It is open for discussion. There are already some business possibilities we can explore with the power of connectivity. We can keep insurance and leasing companies posted with how drivers behave and help them develop a new fee rate like “pay how you drive.” With live data diagnostics, we can advise on routine maintenance to operators of construction and mining machines to avoid breakdowns and business losses.

Q: Do you believe that data will become the “new oil,” and whoever owns it will make a lot of money?

Tyroller: I think there will be an increasing number of cooperation models for that in the future. It is not a competition for one to fight alone because data streams come from a connected world. We are in favor of an open Internet of Things and solutions not just for Bosch products.

Q: The merger of the physical and digital worlds raises a lot of issues about security and privacy because our lives now seem easier to peek into. How will Bosch insure that its Internet of Things users are not vulnerable to intruders?

Tyroller: Whenever we handle data, there must be no leaks. For that purpose, we have launched our first Internet of Things cloud-computing infrastructure and platform at a dedicated data center in Germany. Additional cloud services locations are planned for the United States, Singapore and China. We leave the decision to users as to what we can do with their data, when to provide their personal data and when they want to have them deleted. We understand that as everything gets connected, our customers will be more concerned about their lives becoming too transparent.

http://mobile.shanghaidaily.com/article.aspx?i=612957

The Skills IoT Must Master

Gartner has highlighted eight key aspects of connectivity that will demand particular attention in the coming years, the next two years to be specific.

Claiming there are skills and technology that companies have “yet to master”, Gartner VP Nick Jones said “immaturity” among technology, services and companies is a real problem.

“Architecting for this immaturity and managing the risk it creates will be a key challenge for organisations exploiting IoT. In many technology areas, lack of skills will also pose significant challenges,” he said.

With early-adopter benefits likely, everything from customer interaction to supply chain management is in line for an overhaul as technology advances. Here are eight areas we need to keep an eye on, according to Gartner.

Security

A major concern is that the more connected devices, the more reward for hacking into just one. If your entire home is synced – heating, fridge, lighting, cooker etc – then breaking into a thermostat could, in theory, give access to everything.

Data attacks, as well as tampering, are risks, with anything that has an ISP under threat.

IoT security will be complicated by the fact that many ‘things’ use simple processors and operating systems that may not support sophisticated security approaches.

“Experienced IoT security specialists are scarce, and security solutions are currently fragmented and involve multiple vendors,” said Jones. “New threats will emerge through 2021 as hackers find new ways to attack IoT devices and protocols, so long-lived ‘things’ may need updatable hardware and software to adapt during their lifespan.”

Analytics

Customer behaviour is key to connected devices, again using the home as an example. When you get up, when you shower, when you’re home etc. Other data treasures include when services or products need to be delivered, improved upon or even created.

However, IoT demands new analytic approaches, according to Gartner. “New analytic tools and algorithms are needed now, but as data volumes increase through 2021, the needs of the IoT may diverge further from traditional analytics.”

Device management

Keeping devices up-to-date is important now, it will be more so in the future. So-called ‘long-lived non-trivial’ devices will be key.

“This includes device monitoring, firmware and software updates, diagnostics, crash analysis and reporting, physical management, and security management,” according to Gartner.

Networks

Low-power, short-range networks will dominate wireless IoT connectivity in the short term, however, wide-area networks will exist alongside this. The latter will eventually come to deliver connectivity of ranging speeds, across varying distances. Battery life must improve, and costs must reduce.

Processors

Processors are developing at a fast speed. Only today, a new, low-power concept was shown by researchers looking to drive microelectronics into the next age.

As with all hardware design, there are complex trade-offs between features, hardware cost, software cost, software upgradability and so on. As a result, understanding the implications of processor choices will demand deep technical skills.

Operating systems

Windows and OS were not designed for IoT devices. They are too heavy, require too much support and can be slow. They also have too large a memory footprint for small devices and may not support the chips that IoT developers use. Consequently, a wide range of IoT-specific operating systems has been developed to suit many different hardware footprints and feature needs.

Event stream processing

In some cases, future devices will need to be able to analyse huge data rates, in real time. “To address such requirements, distributed stream computing platforms (DSCPs) have emerged. They typically use parallel architectures to process very high-rate data streams to perform tasks such as real-time analytics and pattern identification.”

Platforms, standards and ecosystems

IoT platforms bundle low-level device control, data management and app development into one single product. These will become a lot more common. Ecosystems and standards will eventually materialise as APIs. A problem is there will be no true API for standards, rather many in competition.

“Organisations creating products may have to develop variants to support multiple standards or ecosystems and be prepared to update products during their lifespan as the standards evolve and new standards and related APIs emerge,” according to Gartner.

8 areas to prepare for as IoT age approaches

 

Insurance companies are paying attention to the IoT

The Internet of Things (IoT) is creating major new opportunities for the insurance industry. IoT data can help insurers more accurately price premiums, create better models for future payouts, and offer products with incentives for good behavior.
This comes at an important time for the insurance industry, which has struggled to develop long-term growth strategies. 75% of insurance execs expect they will feel pressure to innovate from new data sources, such as IoT devices, within three to five years, according to a survey.
The auto insurance sector has already begun embracing the IoT through a new product called usage-based insurance (UBI). UBI policies use the IoT to monitor clients’ driving habits in real time and price premiums based on the risk the company sees.
One in five US households participated in an auto UBI program in 2015, up from 13% in 2013, according to a survey.
But in order to get people to adopt UBI policies, insurers will need to effectively market the products and be transparent about which driving behaviors will cause their policies to go up or down.
The health and life insurance sectors are beginning to leverage wearables to give consumers incentives for good behavior. 39% of insurers surveyed said they have either launched or are piloting insurance programs that leverage health and fitness monitors, up from 10% in 2014.
But data privacy safeguards will be critical if this type of monitoring is to take off. Health data is some of the most sensitive personal information.
Home insurance companies are encouraging consumers to use connected home devices to keep their properties safe. Internet-connected cameras, water sensors, and smoke detectors can potentially minimize the amount of money an insurance company has to pay should any damage occur.
The IoT has also created a new type of insurance coverage — cyber insurance. The adoption of IoT devices by large enterprises has created lots of new entry points for hackers to infiltrate a large organization’s systems. Companies are investing in these policies to offset the huge costs associated with breaches.
Drones, a major IoT product, are helping insurers assess damages and creating a new business opportunity. Insurers can deploy drones to record and monitor damages faster and more safely than using an employee to do this. For enterprises that employ drones, insurers are beginning to insure the devices in case of crashes or damages.

Non brand created content has more value than we thought

CONSUMER-GENERATED CONTENT HELPS DRIVE ONLINE SALES: Consumer-generated content (CGC) is on the rise as e-commerce continues to grow thanks to social media and product review sites. Shoppers are able to more readily spread the word of their favorite brands and products, and retailers are taking advantage to drive sales, according to a report from BazaarVoice.

Shoppers that interact with CGC are 97% more likely to convert with a retailer than customers who do not. Brands see a 78% lift in conversion rates when customers interact with CGC.
Revenue per visitor for retailers increases 106% when customers interact with CGC versus those that do not. For brands, revenue per visitor sees a 75% lift due to CGC.
Average order value among retailers gets a 10% lift when shoppers interact with CGC. For brands, AOV sees an 8% lift.
Taking advantage of the high volume of CGC is vital to retailers that want to win over potential shoppers and their trust. US consumers are heavily reliant on online reviews before making both in-store or online purchases, according to a separate report from Bazaarvoice cited by Internet Retailer. In addition to including shoppers’ social media posts in their own campaigns, brands and retailers can reprint positive feedback in brick-and-mortar locations, print advertisements, and other online ad campaigns to help drive sales.

54% of US shoppers read online reviews before making an e-commerce purchase.
39% of shoppers read online reviews before buying in-store.
82% of shoppers read reviews while inside a store immediately before making a purchase.
The most read reviews are for electronics, with 58% of shoppers performing research before buying anything in this product category in-store.
bii cgc on purchase journey

You or your neighbors? 50% of homes will be smart

Some homes will be getting smart and others won’t.

The latest forecast of North American broadband households shows that half of them will be smart homes within four years.

Of course, this means that the other half will remain not so smart.

Most (84%) of U.S. households will have broadband this year, so this pretty well translates to most homes, according to the new data from Parks Associates.

Just a day ago, the same researchers identified that many consumers want to be able to connect the smart objects in their homes to their cars, as I wrote about here (Consumers Want Their Home And Car Connected To Each Other). But again, some, not all.

Connected home systems ultimately can incorporate devices such as wearables, smart thermostats, home security, apps and various mobile devices.

But the key is the broadband connection, through which many of the devices communicate to each other and to consumers.

Ownership of smart home products increased from 16% to 19% of U.S. broadband households in the last year and 44% of households that do not have a smart home device plan to purchase one this year.

This growth will continue and 50% of North American households with broadband will be smart homes by 2020, according to the study.

Major companies, including Amazon, Apple, Google and Facebook, are active in connected homes, since they all have a vested interest in creating smart products that might appeal to consumers.

For example, Amazon’s Echo, with its Alexa natural language processing, has been teaming with many other companies that want to be enabled through Amazon’s technology, creating more of a bond with consumers.

The marketing challenge will be to keep up with messaging methods to smart homes and homes that aren’t.

And then there’s the issue of which devices will be more marketing adaptable, since some will have screens through which video communications can be sent while others will be more audio oriented, requiring a different form of messaging.

It appears there will be a divide between the number of consumers who gravitate to smart devices and those who don’t.

Kind of reminds me of the early days of smartphones.