Apr 19, 2015

The IoT Question: What Business are you Truly In?

This started as a Delphi discussion along with Scott Feldman from SAP, Alex Paleologoes a CTO from a Greek shipping company, Klaus Huber from Deutch Telekom and the undersigned over a round of beer in Palo Alto. We started discussing how IoT is already changing the very definition of any industry.

We started by asking the foundation question "What industry is the Ford company truly in?" Only to realize very fast that Ford is not in the automobile business any longer. Just like Kodak was not in the business of photography or Telex in the business of print replication. Ford and other automobile companies we agreed after a few minutes are in the business of taking a passenger, or a product, from point A to point B in a safe and timely manner. Using this as a baseline we then delved as to how the very definition of this industry is rapidly and predictably changing based on new IoT technology.

Google has been experimenting with over 10 driverless cars that have driven over one and a half million miles without a single accident, scratch or other issues. Each of you try and remember how many miles you had driven before your first scratch or an accident and we suddenly see a very different view of driverless cars. Imagine no more auto insurance, no more scratches, no more running out of gas, no more a whole lot of hospital bills and no more DUI or deaths on the road- what is the price for that assurance. Ten years from today when you have to buy a car for your 16 year old daughter will you buy a car that you get today or one that drives itself to where she need to reach in a timely and safe manner- and more.  At the same time Jaguar has built a car that tracks head and eyes movement and auto stops if the driver is falling asleep. And BMW already has a prototype self-parking car that works on streets as they are today with Zero changes. Its a driverless, self-parking version. You can drive to a restaurant, get out of the car and ask the car to park itself. The car will find the nearest parking spot on its own and park itself. You smart watch or BMW app allows you to step outside, walk around and when ready ask the car to pick you up. The car will self-drive to your location in driverless mode to pick you up. Now with all these changes the biggest disruptions to the Auto industry just might just be Google and Apple (Now that apple is planning on an Apple-Car (according to the Silicon Valley street talk).

Companies have to re-evaluate this new world of IoT that GE estimates to be $14 Trillion just in the IIoT space - that is the Industrial IoT, i.e. manufacturing sector only.  Cisco projects the IoE (Internet of Everything) as a $19 Trillion market. HRB predicts this to be a $14 trillion market. From our studies we see a $1-2 Trillion market in the SAP IoT Market area alone. So no matter how you slice these numbers the market is huge. Read the article by the anchor of global competitive positioning Michael Porter in HBR 'How smart connected products are Transforming Competition' and you will begin to get a feel of the disruption right around the corner.

Me thinks this is going to be as big a change as Computing was in by the mid 80's. The speed of change accelerates each year so adoption is going to be faster than computers.

Some sample disruptions we are already witnessing:

Smart IoT Hub: For the coming future we will see an explosion of smart devices from smart watches to Fitbits and other personal sensors. However the hub of all these personal IoT devices will remain the smart phone. The Apple and Android Apps will become all the more important. Data harmonizers will provide a single pane of glass to all your health apps that will surround you and your smart phone. We don't see this hub being replaced anytime in the near future- but then change is the only constant- who ever could foresee the disruption of the iPhone before it happened. event in the enterprise world this device will remain the personal hub of information for the near future with the maximum per capita penetration of all other devices with a easy UI (User interface)

Automobile: Our grandfathers used to drive a car which would often break-down without warning. It had to be towed to the mechanic who would take a day or so to find out what is wrong. A decade or two ago we fixes some sensors in our cars and a red light switched on when something was wrong, but the driver had no clue what was wrong till they took the car to a certified mechanic. The mechanic would shove a plug into the compute slot and carry some expensive decoder that would rapidly analyze what was wrong in the vehicle. Today we can get a gizmo that we can shove by ourselves and get that same level of detail on our IPhone or iPad. Companies like Tesla already have a dashboard console larger than a standard iPad that can tell us what is wrong.

In the future your driverless car will not only identify what may be wrong with a component but will simultaneously inform the car company, find a service provider, check their stocks and ask the owner that time slot is available for the car to self repair. At the same time it will talk to other cars to find out if this is a systemic problem or something isolated to this one case. with such a system we could avoid the Tekeda safety bag that some think turned out to be a grenade under the steering wheel in disguise from every happening.

Smart Healthcare: Patients will not become products with real-time IoT devices they carry or imbedded into their bodies. They will select providers not by loyalty by by crowd recommendations of quality versus cost. Patients will be walking data producers and broadcasters. All patients today are real-time IT data producers - a product for real time visibility across the entire health-care fabric.

Smart Farming: Farms are already becoming smart with precision seeding, fertilizer and watering undertaken with IoT sensors. This not only saves wastage and thus money but also results in higher yields. so its a win-win. All seeds, farm workers, soil condition, water saturation, fertilizers, finished product storage; transports are today becoming real-time IT data producers - a product for real time decisions across all the enterprise farms. add weather to all these examples.

Smart cities: Israel is the first country to go the smart Country way. Barcelona the first Smart city. Smart cities will monitor social security, buses, energy and water, parking, snow cleaning, crime, buildings, and a host of other areas with streaming sensors [places in all critical locations for real-time visibility of all critical flows in a city. All critical assets today are real-time IT data producers - a product for real time visibility across the city.

Smart Army: with guns, equipment and personal being tagged with sensors we can easily identify friend or foe in low visibility situations. we can identify friend down of the soldier stops moving and the weapon continues to move. We can track every shipment of ammunition and weapon from start to end and send real-time alerts when a shipment or part of the shipment is diverted into the wrong hands- all this in real-time. We are already building smart Army HQ's with 3D visualizations and tracking of every authorized and unauthorized entry into any room. This is the part we know. The soldier and all army assets today are real-time IT data producer - a product for our decisions.

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