Cisco projects $14.4 trillion future for IoT

Posted on 4th March 2013 in Internet of Things

I’ve been delinquent about posting my take on Cisco’s recent release of a white paper in which they predicted a $14.4 trillion in what they term “Value at Stake,” (a combination of increased revenues and decreased costs for companies embracing [or lost by companies that don’t embrace it) what they call the “Internet of Everything” between now and 2022).

The white paper, “Embracing the Internet of Everything to Capture Your Share of $14.4 trillion,”  is by far the most comprehensive projection on the IoT’s near-term growth, and certainly gives cause for optimism (although they warn that the benefits could be diminished if companies don’t adequately provide for robust security and privacy protections!). It’s a must read as well because of the case studies included to justify the projections: I’d strongly recommend it as a source of practical ideas to any company wondering about whether they should be launching IoT initiatives. 

The $14.4 trillion is made up of:

  • asset utilization (ugh: why do people insist on substituting “utilize” for “use”?  — a pet peeve) (or reduced costs) of $2.5 trillion
  • employee productivity (greater labor efficiencies) of $2.5 trillion
  • supply chain and logistics (eliminating waste) of $2.7 trillion
  • customer experience (addition of more customers) of $3.7 trillion
  • innovation (reducing time to market) of $3.0 trillion.

The projections are extrapolated from the benefits that companies are already realizing from early-stage IoT projects such as “smart grids, smart buildings, connected healthcare and patient monitoring, smart factories, connected private education, connected commercial (ground) vehicles, connected marketing and advertising, and connected gaming and entertainment.” The IoT’s future progress is being driven by technologies such as the cloud and economic principles such as Metcalfe’s Law.

The report reuses a favorite Cisco statistic, that 99.4% of all “things” that will eventually be linked by the IoT are not linked at this point, so the sky is the limit for the future.

I can’t emphasize it enough: this report is must reading for smart business leaders trying to understand the IoT and how to capitalize on it.