Smart Infrastructure Logical Top Priority for IoT

The only issue Clinton and Trump can agree on is the need for massive improvements to the nation’s crumbling infrastructure, especially its roads and bridges. But, please, let’s make it more than concrete and steel.

Let’s make it smart, and let’s make it the top priority for the IoT because of the trickle-down effects it will have on everything else in our economy.

Global economist Jeffrey Sachs stated the case eloquently in a recent Boston Globe op-ed, “Sustainable infrastructure after the Automobile Age,” in which he argued that the infrastructure (including not only highways and bridges but also water systems, waste treatment, and the electric grid) shaped by the automotive age has run its course, and must be replaced by one “in line with new needs, especially climate safety, and new opportunities, especially ubiquitous online information and smart machines.”

I’m currently reading Carlo Ratti and Matthew Claudel’s The City of Tomorrow: Sensors, Networks, and the Future of Urban Life, which makes the same argument: “The answer to urban expansion and diffusion — and the host of social consequences that they bring — may be to optimize, rather than increase, transportation infrastructure.”

The IoT is perfectly suited to the needs of a new information-based infrastructure, especially one which must balance promoting the economy and mobility with drastic reductions in greenhouse gasses (transportation produces approximately a third of the U.S.’s  emissions). It can both improve maintenance (especially for bridges) through built-in sensors that constantly monitor conditions and can give advance warning in time to do less-costly and less-disruptive predictive maintenance, and reduce congestion by providing real-time information on current congestion so that real-time alterations to signals, etc., can be made rather than depending on outmoded fixed-interval stoplights, etc.

Sachs points out that infrastructure spending as a percentage of GDP has fallen since the Reagan years, and that it will require much more spending to bring it up to date.

A good place to look for a model is China.  The country already sports the largest concentration of M2M connections in the world: “74 million connections at the end of 2014, representing almost a third of the global base,” much of that in the form of smart bridges, smart rails, and smart grid, and critical because of the country’s rapid economic growth (Ratti cites a Beijing traffic jam that immobilized cars for an astounding 12 days!). Similarly, the government aims to have 95% of homes equipt with smart meters by next year.The country has used its investment in smart infrastructure to build its overall IoT industry’s ability to compete globally.

Sachs argues for a long-term smart infrastructure initiative:

“I propose that we envision the kind of built environment we want for the next 60 years. With a shared vision of America’s infrastructure goals, actually designing and building the new transport, energy, communications, and water systems will surely require at least a generation, just as the Interstate Highway System did a half-century ago.”

He says we need a plan based on three priorities to cope with our current national and global challenges:

“We should seek an infrastructure that abides by the triple bottom line of sustainable development. That is, the networks of roads, power, water, and communications should support economic prosperity, social fairness, and environmental sustainability. The triple bottom line will in turn push us to adopt three guiding principles.

First, the infrastructure should be “smart,” deploying state-of-the-art information and communications technologies and new nanotechnologies to achieve a high efficiency of resource use.

Second, the infrastructure should be shared and accessible to all, whether as shared vehicles, open-access broadband in public areas, or shared green spaces in cities.

Third, transport infrastructure should promote public health and environmental safety. The new transport systems should not only shift to electrical vehicles and other zero-emission vehicles, but should also promote much more walking, bicycling, and public transport use. Power generation should shift decisively to zero-carbon primary energy sources such as wind, solar, hydro, and nuclear power. The built environment should be resilient to rising ocean levels, higher temperatures, more intense heat waves, and more extreme storms.”

The IoT, particularly because of its ability to let us share real-time data that in turn can regulate the infrastructure, is ideally suited to this challenge. It’s time for Congress to not only spend on infrastructure but to do so wisely.

The result will be not only the infrastructure we need, but also a more robust IoT industry in general.

 

High-speed 3D Printer & IoT Could Really Revolutionize Design & Manufacturing

There’s a new high-speed 3D printer on the horizon which, coupled with the IoT, could really revolutionize product design and manufacturing.

I’ve raved in the past about 3D printing’s revolutionary potential, but I’ll admit I was still thinking primarily in terms of rapid prototyping and one-off repair parts.  Now, according to Bloomberg, HP is going to transfer its ink-jet printer expertise to the 3D printer field, with a $130,000 model set for release later this year that, for the first time, could make 3D printing practical and affordable for large-scale manufacturing, with “parts at half the expense and at least 10 times faster than rival printers — and likely [using] lower-cost materials.”

Combined with the IoT, that would go a long way toward making my “precision manufacturing” vision a reality, with benefits including less waste, streamlined products (a single part replacing multiple ones that previously had to be combined into the final configuration),  factories that are less reliant on outside parts and encouraging mass customization of products that would delight customers. 

Customers are already lining up, and see manufacturing-scale 3D printing as a game-changer:

Jabil Circuit Inc. [itself a digital supply-chain innovator] plans to be an early adopter of HP’s device, printing end plastic parts for aerospace, auto and industrial applications that it currently makes using processes such as injection molding, John Dulchinos, vice president of digital manufacturing at the electronics-manufacturing service provider, said in an interview.

“‘We have use cases in each of these segments,’ Dulchinos said. ‘Parts that are in hundreds or thousands or tens of thousands of units — it’s cheaper to 3D print them than mold them.’”

Other HP partners in the venture include BMW, Nike, and and Johnson & Johnson. The article cites research by Wohlers Associates predicting that manufacturing using 3D printers could “eventually grab at least 5 percent of the worldwide manufacturing economy, and translate into $640 billion in annual sales.”

3D Systems is also making the transition to large-scale 3D printing.

As I’ve written before in regard to GE’s leadership in the field, toss in some nanotech on the side, and you’ve really got something.

 

Game-changer! AR Enables IoT merging of physical and digital

Several months ago I wrote about an analogy to the world of business prior to the Internet of Things,  in which a metaphorical illness called “Collective Blindness” affected every human for all time, so that we were unable to peer inside things. We just accepted that as an inevitable limitation, creating all sorts of work-arounds to try to be able to cope in the absence of real-time information about things of all sorts.

I then said that the Internet of Things would allow us to end Collective Blindness, getting — and sharing — the real-time data we’d need to make better decisions and work more precisely.

Now I’ve seen the tool that allows us to end that Collective Blindness: PTC’s Augmented Reality (AR), tool, Vuforia.

At last week’s PTC Liveworx conference, there was a mind-blowing demo of Vuforia by Terri Lewis, director of solutions and tech at Caterpillar, as it applied to the company’s XQ Gen Set, a portable power generator for job sites and special events.  As PTC CEO James Heppelmann reiterated several times, the software is creating

a single new reality that’s physical and digital at the same time….. and democratizing AR.”
(my emphasis)

Used as a sales tool, Vuforia Studio Enterprise lets the customer look inside the product, as contrasted with a static brochure.  That’s neat, but what’s really incredible is how it lets maintenance people peer inside the device, and do so in a way (as Heppelmann said, “humans prefer to use sight an sound simultaneously”) that is much more effective in terms of zeroing in not only on what’s wrong, but also these specifics (such as replacement part numbers, etc.) to quickly repair them.  Incidentally Heppelmann and Harvard Prof. and biz guru Michael Porter are collaborating on another article, this one on how to apply AR in a business setting (turns out that Porter is a member of the PTC board, and in the past few years he’s been using it as a lab to evaluate business use of the IoT).

Another example of Vuforia’s work in maintenance demonstrated at the conference was by Flowserve, the world’s largest flow control company. Vuforia helps them manage devices in real-time (the person at the pump can see what is actually happening), cutting the number of repair trips from three to one, because they are able to diagnose the problem at the beginning, and bring the replacement parts with them. Then they can do do real-time simulations to see if the problem has been solved. The company believes they saved $2 billion in excess repart costs in 2015 alone.

 Vuforia Studio AR lets users set up augmented reality simulations in minutes without writing code, and can also be used in product design review.

I had a chance to try the XQ Gen Set visualization with an AR headset myself, and it was as powerful as promised.

I must admit the first time I tried on an AR headset — and almost jumped on one of the other users because I was jumping back to avoid falling several hundred feet off a sharp cliff into the ocean — I was amazed by the realism, but didn’t really think much about its serious business uses.  PTC’s Vuforia Studio AR made me a believer: it’s helping us cure Collective Blindness, and AR will be yet another tool to bring about unprecedented precision and efficiency in every aspect of manufacturing and product maintenance!

Live Blogging from SAP’s SCM CRM IoT 2016

I’m back in Sodom and Gomorrah in the desert, AKA Las Vegas, to speak at another SAP IoT conference: SCM CRM IoT 2016, and to live blog again!

Keynoters: Hans Thalbauer, sr. vp of extended supply chain solutions at SAP, and Dr. Volker G. Hildebrand, global vp or customer engagement & commerce for SAP Hybris:
Hildebrand:

  • theme: move beyond traditional CRM: look at entire customer journey
  • you have to meet customer expectations for convenience, relevance, reliability, and in real-time.
  • real lesson from Uber: customers upend markets, not companies; carry power of internet in their pocket; if you’re fighting alone, you have no chance of success;
  • when London cabbies went on strike, Uber membership went up 850% in 3 days.
  • “74% of execs. believe digital transformation is improving value for customers”
  • must thinking beyond CRM: 2 of 3 companies don’t think their CRM doesn’t support their future needs for customer engagement.
  • blend marketing & commerce.
  • personalization is key to digital commerce.
  • beyond service: customer served before, during & after buy; flawless field service. 53% abandon online purchase if they don’t be quick answers to questions.
  • why no app from cable provider allowing you to get assistance Uber-style? Instead, hold on phone.
  • One-to-one future is here.
  • Omnichannel selling
  • By 2020: 1 million fewer B2B sales reps (@Forrester)
  • EY: enabled collaboration with 15,000 client partners
  • “Engage your customers like never before:” commerce, marketing, service & sales.

Bob Porter, Pregis (protective packaging):

  • liked ease of use with Hybris (vs. Salesforce)

Thalbauer (digital transformation of supply chain):

  • end-consumer driven economy
  • very related to IoT
  • tech adoption accelerating
  • biz model transformation
  • instant notification if the equipment malfunctions
  • change of business transformation
  • disruption in every aspect of business:
    • customer-centric (demand sensing, omni-channel sales, same-day delivery)
    • individualized products (configured products, digitalized inventory, lot size of one)
    • resource scarcity (talent, sustainability, natural resources)
    • sharing economy (social networks, business networks, asset networks)
  • sweet: combo of 3-D printing at warehouse & Uber-based model for final delivery.
  • extended supply chain demo: sweet (literally): 3-D printing of chocolates at high-end stores! — wonderful example of IoT data-centric enterprise
  • SAP increasing pace of innovation
    • fastest-growing planning solution in history
    • only live logistics platform in the market
    • product innovation platform re-defined
    • demand-driven manufacturing
    • digital assets.

Next up: Sacha Westermann, Port of Hamburg, on how it uses IoT to streamline operations, improve efficiency & reduce accidents through “smartPORT”:

  • it’s very big (largest port in Germany), and very complex! Ships, rail (largest rail hub in Europe), trucking. 24/7.
  • big emphasis on environment: need to reduce emissions, improve sustainability.
  • can’t expand area, but must be able to handle more volume.
  • key factor is connectivity between all parties.
  • smartPORT includes energy & logistics.
  • smart maintenance: use mobile to call up SAP order & create messages, take photos. Example of malfunction with a drawbridge. Technician got new button from stock, installed it, customers didn’t even know there was a problem.
  • port monitor: digital map with all info to operate the harbor. Mobile version on iPad.
  • SmartSwitch for rail: sensors on the switches to measure conditions. Automated data flow to maintenance company.
  • dynamic info on traffic volumes: combines all real-time data on traffic. Detects available parking spaces. Created “PrePort Parking” as holding area for trucks that are early or late. Trucks park bumper-to-bumper for maximum efficiency.
  • special traffic lights: cycle changes based on real-time traffic flow. Warning messages if pedestrians cross.
  • smartROAD: smart sensing of the bridge-structural load — identifies interdependencies and to do predictive maintenance.
  • Take aways:
    • good application requires lot of data
    • must share data
    • data privacy critical for confidence
    • everyone gets just info they need
    • more participants, higher the benefit for each
    • open interfaces basic
    • application must be self-explanatory

Next up: me!, on 4 Essential Truths of IoT & how that translates into strategy.


 

Mike Lackey, IoT Extended Supply Chain, SAP explaining their IoT strategy & direction, with emphasis on “driving customer value”:

  • he’s using universe of 75 billion connected devices by 2022.
  • case study: STILL, the smart lift truck from Germany. Forklift sold as service, based on weight of materials carried. They will communicate among themselves, M2M.
  • “It is not about Things, it is about what the Things can do to radically transform business processes!”
  • oil & gas: reducing spills. They worked with the company that made the platform that failed in Deep Horizon — hadn’t been maintained in years.
  • Burbury: want to know exactly what you looked at, share the info among their stores. Creepy: invasion of privacy??
  • UnderArmour: why do you have to wear a band — build sensors right into clothes.
  • Hagleitner (I reported about them at last SAP event) provides supplies for corporate washrooms, etc. Paradigm shift: sensors let them know which dispensers need new materials. “big washroom data
  • applications: drive adoption with a few killer applications. Differentiate with “Thing to Outcome”
  • cloud: leading cloud experience for customers and partners at lowest TCO
  • platform: open big data platform. high-value services for SAP, customer & partner
  • Kaeser Compressors also made paradigm shift: no longer sell air compressors, but air — must guarantee it works constantly. Million data points per compressor daily. Differentiates them from competitors.
  • one tractor company now can recommend to farmers what they should plant based on data from sensors on the plows.
  • Asset Intelligence Network: great example of data sharing for mutual advantage. To be released soon.
  • Enables connected driving experience.
  • SAP IoT Starter Kit can get you started.

Why Global Warming Must Be IoT Focus for Everyone

Thanksgiving 2015I want to offer you six great reasons — five of them are seated with my wife and me in this photo — why we all should make global warming a primary focus of IoT projects for the foreseeable future.

There simply is no way to sugar-coat the grim news coming out of the Paris climate talks: even with the most dramatic limits that might be negotiated there, scientists warn we will fall short of the limits in temperature rises needed to avoid global devastation for my grandchildren — and yours.

Fortunately, the Internet of Things can and must be the centerpiece of the drastic changes that we will have to make collectively and individually to cope with this challenge:

“Perhaps one of the most ambitious projects that employ big data to study the environment is Microsoft’s Madingley, which is being developed with the intention of creating a simulation of all life on Earth. The project already provides a working simulation of the global carbon cycle, and it is hoped that, eventually, everything from deforestation to animal migration, pollution, and overfishing will be modeled in a real-time “virtual biosphere.” Just a few years ago, the idea of a simulation of the entire planet’s ecosphere would have seemed like ridiculous, pie-in-the-sky thinking. But today it’s something into which one of the world’s biggest companies is pouring serious money.”

Let me leave you with a laundry list of potential IoT uses to reduce global warming compiled by Cisco’s Dr. Rick Huijbregts:

  • Urban mobility “apps” predict how we can move from A to B in a city in the most environmental friendly manner. Real time data is collected from all modes of city transportation.
  • Using solar energy to power IT networks that in turn power heating, cooling and lighting. Consequently, reduce AC/DC conversions and avoid 70% electricity loss.
  • IP­based, and POE (Power of Ethernet) LED lighting in buildings reduced energy by 50% because of LED and another 50% because of control and automation.
  • Sensors (Internet of Things) record environmental highs and lows, as well as energy consumption. Data analytics allow us to respond in real­time and curtail consumption.
  • Real time insight in energy behaviour and consumption can turn into actionable reduction. 10% of energy reduction can be achieved by behavioural change triggered by simple awareness and education.
  • Working from home while being connected as if one were in the office (TelePresence, Cisco Spark, WebEx, just to name a few networked collaboration tools) takes cars off the road.
  • Grid modernization by adding communication networks to the electrical grid to allow for capacity and demand management.
  • Planning, optimizing, and redirecting transportation logistics based on algorithms, real­time weather and traffic data, and streamlined and JIT shipment and delivery schedules.

These are all great challenges and offer the potential for highly profitable IoT solutions.  For the sake of my six grandchildren, let’s get going!

I’ll Speak Twice at Internet of Things Global Summit Next Week

I always love the Internet of Things Global Summit in DC because it’s the only IoT conference I know of that places equal emphasis on both IoT technology and public policy, especially on issues such as security and privacy.

At this year’s conference, on the  26th and 27th, I’ll speak twice, on “Smart Aging” and on the IoT in retailing.

2015_IoT_SummitIn the past, the event was used to launch major IoT regulatory initiatives by the FTC, the only branch of the federal government that seems to really take the IoT seriously, and understand the need to protect personal privacy and security. My other fav component of last year’s summit was Camgian’s introduction of its Egburt, which combines “fog computing,” to analyze IoT data at “the edge,” and low power consumption. Camgian’s Gary Butler will be on the retail panel with me and with Rob van Kranenburg, one of the IoT’s real thought leaders.

This year’s program again combines a heady mix of IoT innovations and regulatory concerns. Some of the topics are:

  • The Internet of Things in Financial Services and the Insurance sector (panel includes my buddy Chris Rezendes of INEX).
  • Monetizing the Internet of Things and a look at what the new business models will be
  • The Connected Car
  • Connected living – at home and in the city
  • IoT as an enabler for industrial growth and competition
  • Privacy in a Connected World – a continuing balancing act

The speakers are a great cross-section of technology and policy leaders.

There’s still time to register.  Hope to see you there!

 

 

The IoT Will Reinvent Replacement Parts Industry

Of all the Internet of Things’ revolutionary impacts on industry, perhaps none will be as dramatic as on replacement parts, where it will team with 3-D printing to reduce service time, inventory and costs.

I came to that realization circuitously, upon noticing Warren Buffett’s blockbuster purchase of Precision Castparts, the major precision parts supplier to the aeronautics industry.  Having read last year about yet another breakthrough innovation by Elon Musk, i.e., the first totally 3-D printed rocket engines, I was curious to see what Precision was doing in that area.  Unless my search of their website was flawed, the answer is zip, and that suggests to me that Buffett, who famously once said he doesn’t invest in technology because he doesn’t understand it, may have just bought …. a rather large dinosaur.

I noticed that one of Precision’s biggest customers is GE, which not only is using 3-D jet fuel nozzles on its engines but also ran a high-profile contest to design a 3-D printed engine mount that was open to you, me and the kids trying out the new 3-D printer at our little town’s library (note to Mr. Buffett: might be good to schedule a sit-down with Jeff Immelt before one of your biggest customers takes things in-house). As I’ve written before, not only is GE a world leader in the IoT and 3-D printing, but also in my third magic bullet, nanotech: put all three together, and you’re really talking revolution!

OK, I know 3-D printing is sloow (in its current state), so it’s unlikely to replace traditional assembly lines at places such as Precision Castparts for large volumes of parts, but that doesn’t mean it won’t rapidly replace them in the replacement parts area.  I talked to a friend several years ago whose biz consists of being a broker between power plants that need replacement parts yesterday and others with an excess on hand, and couldn’t help thinking his days were numbered, because it was predicated on obsolete technology — and thinking.

Think of how the combined strengths of the IoT and 3-D printing can help a wide range of industries get replacement parts when and where they need them, and at potentially lower cost:

  • sensors in IoT-enabled devices will give advance notice of issues such as metal fatigue, so that repairs can be done sooner (“predictive maintenance“), with less disruption to normal routine, cheaper and reducing the chance of catastrophic failure.
  • because data can be shared on a real-time by not only your entire workforce, but also your supply chain, you can automate ordering of replacement parts.
  • perhaps most important, instead of a supplier having to maintain a huge inventory of replacement parts on the possibility they may be needed, they can instead be produced only when needed, or at least with a limited inventory (such as replacing a part in inventory as one is ordered). This may lead to “re-shoring” of jobs, because you will no longer have to deal with a supplier on the other side of the globe: it might be in the next town, and the part could be delivered as soon as printed, saving both delay and money.
  • your company may have your own printer, and you will simply pay the OEM for the digital file to print a part in-house, rather than having to deal with shipping, etc.

And, as I mentioned in the  earlier post about GE’s leadership in this area, there are other benefits as well:

  • “We’ll no longer do subtractive processes, where a rough item is progressively refined until it is usable.  Instead, products will be built atom-by-atom, in additive processes where they will emerge exactly in the form they’re sold.
  • “Products will increasingly be customized to the customer’s exact specifications. The products will be further fine-tuned based on a constant flow of data from the field about how customers actually use them.”

Sooo, Mr. Buffett, it’s time that you come to terms with 21-st century technology or Berkshire Hathaway’s financial slide may continue.

 

Give It Up, People: Government Regulation of IoT Is Vital

Could this be the incident that finally gets everyone in the IoT industry to — as I’ve said repeatedly in the past — make privacy and security Job 1 — and to drop the lobbying groups’ argument that government regulation isn’t needed? 

I hope so, because the IoT’s future is at stake, and, frankly, not enough companies get it.

I’m referring to the Chrysler recall last week of 1.4 million Jeeps for a security patch after WIRED reported on an experiment in which two white-hat hackers remotely disabled a Jeep on an Interstate from miles away, exploiting a vulnerable link between its entertainment and control systems.  Put yourself in the place of reporter Andy Greenberg, then tell me with a straight face that you wouldn’t be out of your mind if this happened to you:

“As the two hackers remotely toyed with the air-conditioning, radio, and windshield wipers, I mentally congratulated myself on my courage under pressure. That’s when they cut the transmission.

Immediately my accelerator stopped working. As I frantically pressed the pedal and watched the RPMs climb, the Jeep lost half its speed, then slowed to a crawl. This occurred just as I reached a long overpass, with no shoulder to offer an escape. The experiment had ceased to be fun.

At that point, the interstate began to slope upward, so the Jeep lost more momentum and barely crept forward. Cars lined up behind my bumper before passing me, honking. I could see an 18-wheeler approaching in my rearview mirror. I hoped its driver saw me, too, and could tell I was paralyzed on the highway.

“You’re doomed!” Valasek [one of the hackers] shouted, but I couldn’t make out his heckling over the blast of the radio, now pumping Kanye West. The semi loomed in the mirror, bearing down on my immobilized Jeep.”

OK: calm down, get a cool drink, and, when your Apple Watch says your heart beat has returned to normal, read on….

But, dear reader, our industry’s leaders, assumedly knowing the well-publicized specifics of the Chrysler attack, had the hubris to still speak at a hearing of the Internet Subcommittee of the House of Representatives Judiciary Committee last week and claim (according to CIO) that that government regulation of the IoT industry wasn’t needed.

CEA CEO Gary Shapiro said in calling for government “restraint”:

“It’s up to manufacturers and service providers to make good decisions about privacy and security, or they will fail in the marketplace….. Industry-driven solutions are best to promote innovation while protecting consumers.”

Sorry, Gary: if someone dies because their Jeep got spoofed, the survivors’ attorneys won’t be content with the company’s failure in the marketplace.

There are some important collaborative efforts to create privacy and security standards for the IoT, such as the AllSeen Alliance. However, as I’ve written before, there are also too many startups who defer building in privacy and security protections until they’ve solved their technology needs, and others, most famously TRENDnet, who don’t do anything at all, resulting in a big FTC fine.  There are simply too many examples of hackers using the Shodan site to hack into devices, not to mention academics and others who’ve showed security flaws that might even kill you if exploited.

One local IoT leader, Paddy Srinivasan of LoMein, gets it, as reported today by the Boston Globe‘s Hiawatha Bray:

“‘I think it is a seminal moment…. These new devices need a fresh approach and a new way of thinking about security, and that is the missing piece.'”

But it’s too late to just talk about self-policing.

Massachusetts’ own Ed Markey and his Connecticut counterpart, Richard Blumenthal, have called the associations’ bluff, and filed legislation, The Security and Privacy in Your Car Act (AKA SPY Car, LOL)  that would require the National Highway Traffic Safety Administration (NHTSA) and the Federal Trade Commission (FTC) to establish federal standards to secure cars and protect drivers’ privacy. It would also create a rating system — or “cyber dashboard”— telling drivers about how well the vehicle protects drivers’ security and privacy beyond those minimum standards. This comes in the wake of the Markey study I reported on last Winter documenting car companies’ failure to build in adequate cyber-hacking protections.

Guess what, folks?  This is only the beginning.  Probably the only thing I’ve ever agreed with Dick Cheney on (ok, we agree it’s cool to have been born in Wyoming and that Lynne Cheney is a great writer), is that it wouldn’t be cool for the Veep to have his pacemaker hacked, so you can bet there will be legislation and regulations soon governing privacy and security for wearables as well.

As I’ve said before, I come at this issue differently from a lot of engineers, having earned my keep for many years doing crisis management for Fortune 100 companies that bet the farm by doing dumb things that could destroy public trust in them overnight. Once lost, that trust is difficult, if not impossible, to regain.  Even worse, in this case, cavalier attitudes by even one IoT company, if the shock value of the results is great enough, could make everyone in the industry suffer.

So, if you’re arguing for no regulation of the IoT industry, I have just one suggestion: shut up,clean up your act and take a positive role in shaping regulations that would be performance-based, not prescriptive: the horse has already left the barn.

Now I have to check my Apple Watch to see when my heart rate will get back to normal.

 

McKinsey IoT Report Nails It: Interoperability is Key!

I’ll be posting on various aspects of McKinsey’s new “The Internet of Things: Mapping the Value Beyond the Hype” report for quite some time.

First of all, it’s big: 148 pages in the online edition, making it the longest IoT analysis I’ve seen! Second, it’s exhaustive and insightful. Third, as with several other IoT landmarks, such as Google’s purchase of Nest and GE’s divestiture of its non-industrial internet division, the fact that a leading consulting firm would put such an emphasis on the IoT has tremendous symbolic importance.

McKinsey report — The IoT: Mapping the Value Beyond the Hype

My favorite finding:

“Interoperability is critical to maximizing the value of the Internet of Things. On average, 40 percent of the total value that can be unlocked requires different IoT systems to work together. Without these benefits, the maximum value of the applications we size would be only about $7 trillion per year in 2025, rather than $11.1 trillion.” (my emphasis)

This goes along with my most basic IoT Essential Truth, “share data.”  I’ve been preaching this mantra since my 2011 book, Data Dynamite (which, if I may toot my own horn, I believe remains the only book to focus on the sweeping benefits of a paradigm shift from hoarding data to sharing it).

I was excited to see that the specific example they zeroed in on was offshore oil rigs, which I focused on in my op-ed on “real-time regulations,” because sharing the data from the rig’s sensors could both boost operating efficiency and reduce the chance of catastrophic failure. The paper points out that there can be 30,000 sensors on an rig, but most of them function in isolation, to monitor a single machine or system:

“Interoperability would significantly improve performance by combining sensor data from different machines and systems to provide decision makers with an integrated view of performance across an entire factory or oil rig. Our research shows that more than half of the potential issues that can be identified by predictive analysis in such environments require data from multiple IoT systems. Oil and gas experts interviewed for this research estimate that interoperability could improve the effectiveness of equipment maintenance in their industry by 100 to 200 percent.”

Yet, the researchers found that only about 1% of the rig data was being used, because it rarely was shared off the rig with other in the company and its ecosystem!

The section on interoperability goes on to talk about the benefits — and challenges — of linking sensor systems in examples such as urban traffic regulation, that could link not only data from stationary sensors and cameras, but also thousands of real-time feeds from individual cars and trucks, parking meters — and even non-traffic data that could have a huge impact on performance, such as weather forecasts.  

While more work needs to be done on the technical side to increase the ease of interoperability, either through the growing number of interface standards or middleware, it seems to me that a shift in management mindset is as critical as sensor and analysis technology to take advantage of this huge increase in data:

“A critical challenge is to use the flood of big data generated by IoT devices for prediction and optimization. Where IoT data are being used, they are often used only for anomaly detection or real-time control, rather than for optimization or prediction, which we know from our study of big data is where much additional value can be derived. For example, in manufacturing, an increasing number of machines are ‘wired,’ but this instrumentation is used primarily to control the tools or to send alarms when it detects something out of tolerance. The data from these tools are often not analyzed (or even collected in a place where they could be analyzed), even though the data could be used to optimize processes and head off disruptions.”

I urge you to download the whole report. I’ll blog more about it in coming weeks.

Sensors remain critical to spread of Internet of Things

What happens with sensor design, cost, and security remains front-and-center with the Internet of Things, no matter how much we focus on advanced analytical tools and the growing power of mobile devices.

That’s because, on one hand, truly realizing the IoT’s full potential will require that at least some sensors get to the low-power, tiny size and cheap costs needed to realize Kris Pister’s dream of “smart dust” sensors that can be strewn widely.

On the other hand, there’s the chance that low-end sensors that don’t include adequate security firmware can’t keep up with the changing nature of security risks and may give hackers access to the entire network, with potentially disastrous effects.

That’s why several reports on sensors caught my eye.

PWC released a report, Sensing the Future of the Internet of Things, zeroing in on sensor sales as a proxy for increased corporate investment in the IoT, and concluding that by that measure, “the IoT movement is underway.” Based on its 2014 survey of 1,500 business and technology leaders worldwide, there was one eye-popping finding: the US lags behind the entire rest of the world in planned spending on sensors this year: 26% of Asian and almost as many from South America (percentage not given)  followed closely by Africa, with 18%.  The surprising laggards? Europe with 8% and North America, dead last at only 7%.  Hello?????

Equally interesting was the company’s listing of the industry segments leading the deployment of sensors and examples of the sensors they’re using:

  • Energy & Mining: 33%. “Sensors continuously monitor and detect dangerous carbon monoxide levels in mines to improve workplace safety.”
  • Power and Utilities: 32%.  Instead of the old one-way metering, “Internet-connected smart meters measure power usage every 15 minutes and provide feedback to the power consumer, sometimes automatically adjusting the system’s parameters.”
  • Automotive: 31%.  “Sensors and beacons embedded in the road working together with car-based sensors are used for hands-free driving, traffic pattern optimization and accident avoidance.”
  • Industrial: 25%. “A manufacturing plant distributes plant monitoring and optimization tasks across several remote, interconnected control points. Specialists once needed to maintain, service and optimize distributed plant operations are no longer required to be physically present at the plant location, providing economies of scale.”
  • Hospitality: 22%. “Electronic doorbells silently scan hotel rooms with infrared sensors to detect body heat, so the staff can clean when guests have left the room.”
  • Health Care: 20%. “EKG sensors work together with patients’ smartphones to monitor and transmit patient physical environment and vital signs to a central cloud-based system.”
  • Retail: 20%. “Product and shelf sensors collect data throughout the entire supply chain—from dock to shelf. Predictive analytics applications process this data and optimize the supply chain.”
  • Entertainment: 18%. “In the gaming world, companies use tracking sensors to transfer the movements of users onto the screen and into the action.”
  • Technology: 17%. “Hardware manufacturers continue to innovate by embedding sensors to measure performance and predict maintenance needs before they happen.”
  • Financial Services: 13%. “Telematics allows devices installed in the car to transmit data to drivers and insurers. Applications like stolen vehicle recovery, automatic crash notification, and vehicle data recording can minimize both direct and indirect costs while providing effective risk management.”

The surprises there were that health care penetration was so low, especially because m-health can be so helpful in diagnosis and treatment, while the examples of telematics seemed off the mark in the financial services category. Why not examples such as ApplePay?

More compelling were the relatively high rates of sensor deployment in high-stakes fields such as energy, utilities, and automotive: those are such huge industries, and the benefits of real-time data are so compelling that they show the IoT is really maturing.

Finally, the percentage of companies investing in sensors grew slightly, from 17% to 20%, with 25%of what PWC labels “Top Performers” are investing in them compared to 18% the previous year. Surprisingly, most companies don’t get it about sensors’ importance: only “14% of respondents said sensors would be of the highest strategic importance to their organizations in the next 3–5 years, as compared to other emerging technologies.”

Most important, 54% of those “Top Performers” said they’d invest in sensors this year.


 

Sensors’ promise as the size decreases — radically — and functionality increases was highlighted by The Guardian.  It focused on PragmaticIC Printing, a British firm that prints tiny, hairlike sensors on plastics. CEO Scott White’s hope is that:

” the ultra-thin microcircuits will soon feature on wine bottles to tell when a Chablis is at the perfect temperature and on medication blister packs to alert a doctor if an elderly patient has not taken their pills.

“With something which is slimmer than a human hair and very flexible, you can embed that in objects in a way that is not apparent to the user until it is called upon to do something. But also the cost is dramatically lower than with conventional silicon so it allows it to be put in products and packaging that would never justify the cost of a piece of normal electronics,” said White.

 

These uses certainly meet my test of real innovation: what can you do that you couldn’t do before. Or, as White puts it, “It is the combination of those factors [price and size] which allows us to start thinking about doing things with this which wouldn’t even be conceivable with conventional silicon based electronics.”

Another article that really caught my eye regarded a new category of “hearable” — and perhaps even, more radically, “disappearables” –sensors which the headline boldly predicted “As Sensors Shrink, Wearables Will Dis-appear.” But they were barely here in the first place, LOL!  The article mentioned significant breakthroughs in reducing sensors’ size and energy requirements, as well as harvesting ambient energy produced by sources such as bodily movement:

“Andrew Sheehy of Generator Research calculates that, for example, the heat in a human eyeball could power a 5 milliwatt transmitter – more than enough, he says, to power a connection from a smart contact lens to a smartphone or other controlling device.”

 The same article mentioned some cutting-edge research such as a Google/Novartis collaboration to measure glucose levels in tears via a contact lense, and an edible embedded microchip — the size of a grain of sand — and powered by stomach juices, which would transmit data by Bluetooth.
Elsewhere, a sampling of sensor design breakthroughs in recent months show the potential for radical reductions in costs and energy needs as well as increased sensitivity and data yield:

HOWEVER, as I said above, here’s what worries me. Are developers paying enough attention to security and privacy? That could be a real downfall for the IoT, since many sensors tend to be in place for years, and the nature of security challenges can change dramatically during that time.  Reducing price can’t be at the expense of security.

Let me know what steps you’re taking to boost sensor security, and I’ll mention them in a future post!

http://www.stephensonstrategies.com/">Stephenson blogs on Internet of Things Internet of Things strategy, breakthroughs and management