As more and more machines and things we never imagined could communicate via the Internet actually are, newer possibilities and horizons are opening up. This ability, called the Internet of Things, or the Internet of Everything, is revolutionizing the way we communicate and interact with machines and vice-versa. Two breakthrough advances that could propel us into a new revolution have recently picked up speed – Industrial Automation and the Connected Home.
Let’s look at Industrial Automation first. AT&T and GE recently expanded their partnership to add wireless capabilities to a wide range of GE’s industrial machines. Through secure machine-to-machine (M2M) communications, it will soon be possible for millions of these machines to be tracked, monitored and operated remotely in real-time. The M2M connectivity will be enabled by AT&T’s network and cloud.
This is just the beginning of a trend which will soon be the norm – more and more Internet connected machines. Already 15 million+ machines are connected via AT&T’s network, driving operating efficiencies and productivity to new levels. AT&T has estimated that specially designed products and M2M solutions can save the airline industry up to USD $90 million over five years. Looking only at industrial machines like – turbines, jet engines, manufacturing, agriculture, oil & gas production etc. – some analysts predict the market size will reach USD $514 billion globally by 2015.
This emerging market holds enormous potential to optimize industry productivity on a global basis. When combined with technologies like advanced analytics and the connectivity of the cloud, the M2M revolution will mean significant new revenue opportunities and improved network monetization for telcos. For telco customers, M2M will mean reliable service, better value and an improved experience overall.
The other big M2M opportunity, of similarly gigantic proportions, is the consumer household market. The concept of controlling the essential functions of a house – lighting, door locks, water supply, security systems and entertainment devices – remotely via the Internet is not new. Known as Home Automation, the concept got a real shot in the arm in the last couple years as telcos like Deutsche Telekom and Telstra placed bets on this market and start-ups like Quirky amassed funding
According to ABI Research, connected home devices could reach a global market value of USD $10 billion by 2014. Application vendors and consumer electronics players are partnering like never before to harness the true potential of the opportunity. With the rise of the digital consumer and the increase of disposable incomes in emerging markets, it’s likely that the adoption will be swift. Google recently bought device maker NEST for $3.2B. They may have overpaid since it does not seem NEST has that kind of defensible technology. This also gives rise to further privacy issues…invasion of the home!!
There is no doubt about the vast potential these technologies represent. The invention of manufacturing machines ushered in the Industrial Revolution. What sort of revolution will intelligent, self-communicating machines bring about? We live in exciting times!