5 Questions CIOs and CFOs Need to Ask to Prepare for IoT
I’ve just finished a string of briefings on IoT technology, and from the companies doing the briefing, you’d think the big problems were processing power, graphics and security. Granted, they got one out of three right because security is clearly a massive problem with this new class of solutions.
I use the word “solution” very loosely because the other two big problems that we aren’t talking enough about are connectivity and interoperability. Most of this stuff doesn’t interoperate, and connectivity ranges all over the map. This means that while we talk about the Internet of Things, what most folks actually have is a thing that connects to the internet, which isn’t even remotely interchangeable with interoperability.
Let’s revisit the requirements for the concept of the “Internet of Things,” which has become for a lot of people “The Internet of Thing,” which is kind of where we started out.
A Solution Isn’t a Part
The concept of the Internet of Things was massive numbers of devices and sensors all intelligently operating in concert to make the world a better place. Somehow that became individual efforts to connect one thing or another to the internet. There’s been little cross-vendor interoperability and, in fact, not much interoperability within vendor ecosystems either. The bigger the vendor, the more complete the “solution,” but there were clear lines where vendors feared to tread.
Core technologies like full power management, management of equipment (like elevators and HVAC systems), and critical integration with security systems or computer management systems just didn’t seem to happen outside of where these things already operated.
Cisco arguably came the closest with its Toronto Innovation Center, which showcases where all of the systems interoperate. But that remains the exception and not the rule, largely because the folks that build the critical systems simply don’t want to cooperate broadly. They all have IoT strategies but they all seem to come down to the legacy idea that their stuff only works well with their stuff, probably for fear a competitor will come in and force them out.
The market, however, really has bought into this idea of the IoT and it is starting to demand it from vendors. We have examples of vendors who, in the past, have disrupted markets, effectively wiping out the dominant companies that failed to get what their customers wanted.
RCA, AT&T, IBM, Microsoft
These companies executed a strategy of lock-out when they were in their prime but their customers, or the government, got tired of their lack of responsiveness and excessive control. Of the three once invulnerable companies, only IBM remains. This is largely because it eventually adjusted, but it lost the massive and incredibly powerful dominance it once had. AT&T eventually reformed from the Baby Bells it was broken up into, but it only has a fraction of the power and control it once had.
Microsoft was a different case in point because when it pivoted from fighting interoperability to embracing it, it began to reverse its decline. It largely eliminated the calls to break it up or shut it down. Now, particularly with Azure, Microsoft is everyone’s buddy. It appears that Google is more likely to be fined or broken up, which is ironic given that Google’s seeming purpose was to displace Microsoft as a better alternative. Instead, Google just became a different villain.
Microsoft showcases one way to succeed, excel at interoperability and gain power though cooperation, not enforced dominance and lock in.
Intel
Intel Centrino is the perfect example of interoperability. Back when Wi-Fi was a bad joke, Intel got fed up and courageously worked to drive its technology into all laptops. Suddenly, we went from a situation where PCs couldn’t connect reliably to one where we often take Wi-Fi for granted and everything from PCs to cars now connects nearly seamlessly. But we wouldn’t be there if one huge vendor hadn’t gotten fed up and driven its own solution through the segment. Laptops and routers carrying the Centrino brand simply worked, and that is exactly where we need to go with the IoT.
Wrapping Up: Revisiting the Elements
The three key elements of the IoT are connectivity, security and full interoperability. Only when we have all three can we build diverse solutions that can be fully managed (including updates and patches) and provide the data we need in a form we can turn into information in real time. For the most part, we are far from being there and, I believe, this speaks largely to why sales is a tiny fraction of projections. People can’t build solutions and, until they do, we have a market much like the Wi-Fi market was before Centrino — a hot mess. Folks just don’t buy into markets like that.
So the next time you see an IoT presentation, ask the vendor to show you one IoT location where stuff actually works together, ask how well it interoperates with others, what it has been able to determine from the data captured, and drill into how it was all secured. You’ll likely find the vendor is nowhere close to where you need it to be, and that you’d be better off going someplace else for a solution or waiting until the solution you need actually shows up.
Rob Enderle is President and Principal Analyst of the Enderle Group, a forward-looking emerging technology advisory firm. With over 30 years’ experience in emerging technologies, he has provided regional and global companies with guidance in how to better target customer needs; create new business opportunities; anticipate technology changes; select vendors and products; and present their products in the best possible light. Rob covers the technology industry broadly. Before founding the Enderle Group, Rob was the Senior Research Fellow for Forrester Research and the Giga Information Group, and held senior positions at IBM and ROLM. Follow Rob on Twitter @enderle, on Facebook and on Google+.
