The total profit companies will make this year from connected devices will hit $613 billion, says the vendor, which urges companies to innovate and cash in
Science fiction writers have fantasized about a world where almost any object is electronically connected.
IT vendors are polishing it with some facts that are happening right now, such as the increasing number of people who have cellphones, Internet connected cars and a few homes with Internet-connected refrigerators.
Now a study by Cisco Systems Inc., which makes telecom and enterprise network equipment that would make this possible, is trying to put a dollar value on how much it will be worth this year for businesses to cash in what it calls “the Internet of everything.”
That figure is US$613 billion in profit in 2013, Cisco said Wednesday. Canada’s share will be $56.8 billion. If Cisco’s projection is accurate, the country would rank seventh among 12 nations it studied, behind the U.S., ($253 billion), China, ($76.9 billion), Germany, Japan, Australia and slightly behind France.
Firms that optimize the connections among people, processes, data and things will generate the largest profits, said Cisco.
“Just one per cent of the world is connected today, and that’s already generating over $600 billion worth of value in 2013,” Joseph Bradley, general manager of Cisco Consulting Services told international technology reporters on a conference call. “You can imagine what will happen as we accelerate.”
Over the next decade, it also estimates, the networked connection of people, process, data, and things could create $14.4 trillion in profit by leveraging the Internet of everything to improve operations and customer service.
Other IT companies have similar visions. IBM, for example, calls it SmarterPlanet.
Cisco says it came up with its numbers by looking at the revenue of 21 connected technologies it is involved in, such as smart buildings that have Internet-connected lighting and ventilation infrastructure, Internet connected workers, Internet connected cars and teleconferencing.
Earlier this year it outlined the same vision at an editor’s conference.
‘Internet of everything’ is coming: Cisco
Cisco opens Toronto IT building integration centre
Cisco joins developer in Alberta real estate project
SmartThings CTO Jeff Hagins told the reporters his home is wired with enough sensors that they create about 150,000 datapoints a day. The sensors detect when he gets up and turns lights on, and when he goes to bed initiates a shut down routine. Sensors in stores could do the same thing. Eventually, he predicted, such sensors will create “billions” of datapoints.
Rob Lloyd, Cisco’s president of development and sales, noted there are many industrial sensors that can be interconnected. He painted a picture of virtually every industry from agriculture to transportation becoming involved.
Telecommunications and Internet service providers “are intrigued with the potential,” he added, because it could be mean expansion of their market as the vital carriers of data as well as a way to differentiate themselves from competitors.
Ultimately, Lloyd said, creating the Internet of everything will be no different from what the IT industry has been doing in the past few years connecting what we see now – except for the network and storage challenges to be met.