What is holding back the Internet of Things? These 2 barriers
This blog is only 3 weeks old but as I immerse myself into all things IoT I’ve noticed the amount of ink and pixels being spilled about the Internet of “X” is simply staggering. I have time right now to dig into this topic and it’s hard to keep up but I am seeing a trend that isn’t helping the cause and that’s a lack of specificity and rational analysis.
For example there is a cover story in Wired magazine this month that features a connected and instrumented house, you can read the story here: http://www.wired.com/gadgetlab/2013/05/internet-of-things
It’s all very cool and thought provoking but lacking in detail. So let me be more specific; if you read my introductory blog I decided to break the IoT ecosystem into a framework with 8 elements, namely:
1. Sensing and Control
3. Analytics (big data) and the cloud
5. Applications, ROI and 2nd/3rd order effect
6. Standards and Regulation
7. Ecosystems and Communities
8. Investment Opportunities
Articles like the one in Wired or John Chambers speech at the Wall Street Journals tech gabfest (AllthingsDigital/D11) last week paint the 25 billion connected devices picture beautifully but what’s stopping it all from becoming reality?
I have 2 areas of concern that need to be surfaced and addressed. First I think we have underestimated the connectivity issues (#2 in the framework) and who owns the data (#3). These issues will inevitably lead to regulatory issues (#6) but that is further down the road.
The conventional wisdom is that security (#4) is going to be a major challenge but I disagree, we already deal with it on a daily basis, it’s a fact of life in any interconnected system and always has been.
So lets look hard at connectivity and apply some logic and experience to the topic. Unfortunately telecommunications history teaches us that carriers always fight for control (and profit) when new technologies and applications come along and this stifles innovation. Going al the way back to POTS (plain old telephone system) carriers around the world fought all attempts by upstarts to access their networks and disrupt their monopolies, I have personal experience with British Telecom and the AT&T/Bell system was equally notorious (think payphones, cellular, T1 lines etc.).
So how does this apply to the IoT? Well in order for even basic IoT systems to work we need to connect these billions of devices to the cloud and a carrier controls that connectivity. We have seen them move painfully slowly on M2M networks with byzantine pricing schemes and bureaucracy so how will it be any different when we start flooding their networks with millions of new IP addresses? There are some possible alternatives like using “white space” spectrum (check out http://www.neul.com/) Or clever reuse of existing Wi-Fi routers which was pioneered in Spain by FON http://corp.fon.com/ but at some point the packet will travel through a carrier and that’s where its going to get complicated and that certainly looks like a barrier to me. Just mentioning regulation will inflame some people but there is a lot to be said for a certain amount of government intervention when an opportunity as big as this comes along. Governments who have been enlightened about giving cheap and plentiful Internet access to their citizens have fared very well compared to others that have restricted or ignored it; think Korea and Scandinavia versus the US. The US is not in the top 10 countries with the fastest or great % of Internet users, which was a shock to me, and I think the carriers have a lot to do with this. To get a very critical view of how US carriers have held back our internet access check out this interview with Susan Crawford of Yale @scrawford http://billmoyers.com/segment/susan-crawford-on-why-u-s-internet-access-is-slow-costly-and-unfair/
So what can we do about this? My take is that internet access should be a basic right just like water and power and it should be easy to connect and cheap. Easy to say but hard to do but we need to agitate for government and/or industry leadership on this or the IoT will happen in other countries first and that will put the US behind in an area where we need to lead.
The second barrier we need to address is the whole question of who owns the data? (That’s #3) These rosy scenario’s of cars, highways, mobile phones, homes and people all throwing off data and letting it be used for the greater good is all very thought provoking but hold on a second; whose data is it anyway? Who gets to control the data, make money from it, distribute it, store it? Anonymize it? Secure it? This is even bigger than the connectivity barrier in my view. This is going to be a whole new battle in information privacy and security that will dwarf earlier debates about Facebook posts and Google searches. The potential pitfalls of data ownership are already beginning to surface in this fascinating case of Verizon using phone data from attendees at a Phoenix Sun’s game to sell highly targeted real time advertising. You can opt out but few people are even aware of what is happening to their data and it reinforces my point above in that Verizon wants to use that data to make money not share it. http://online.wsj.com/article/SB10001424127887323463704578497153556847658.html
On this point I do have a modest proposal to solve the issue and that’s to create a non-profit entity to hold and distribute the data a little but like the way ICANN (http://www.icann.org/)
Handles domain names. This would level the playing field for all the start-ups and creative people out there to develop applications who might otherwise be locked out of the system. Freedataflow.org or something like that. Heck I may even volunteer to get it done!
These 2 barriers are real and will hold back IoT until they are addressed so even though they seem large and insurmountable the sheer amount of new revenue streams that can come from new applications (John Chambers says $14 trillion at AllthingsD) will drive the industry to address them. That’s my hopeful view, what’s yours? Please comment below.