How Internet Of Things Can Improve Business Growth And Lifestyle

University “Politehnica” of Bucharest

The Faculty of Engineering in Foreign Languages

How Internet of Things can improve business growth and lifestyle

Research

STUDENT: Research Advisors: Stoica Mihai Vlad Sl. Dr. Bujor Pavaloiu

Figures and tables

Figure 1: Types of opportunities

Figure 2: ITRON Annual Bookings and Backlog

Figure 3: Smart Light City Network

List of acronyms

IoT – Internet of Things

GSM – Global Positioning System

WiFI – Wireless Fidelity

PLC – Power Line Carrier

Introduction

It was called Internet of Things, Internet of Everything, Machine to Machine communications and Industrial Internet, but in fact all these names signify the same thing, everything connected to internet, each applience will be from now one a „smart” one. All this can change how we do business and how we leave. Everything will be more simple and will be made with simple clicks.

Internet of Things gives you the ability to administer physical things electronically making viable to enhance performance of structures and procedures, saving in this way time for people, money for companies and improving in this way lifestyle or quality of life. With IoT one can monitor devices in production, tracking cars or ships at sea, with sensors companies can see exactly there machines state, in this improving their lifetime and also remodel them to have better performances. Nowadays are many wearable devices like smart watches and fit bracelets which can intensely increase health condition.

Companies that have already implemented IoT are trying now to make other investments in fields like tracking of assets remotely, power, navy organization and safety.

Internet of Everything is definitely not something from the future, but for sure is not something accessible off the cuff.

This technology is not new, most of it is well-known. When we think about assembling a new IoT application, we think about the selection of multiple gears: modules of telecommunications, sensors and of course a well-designed network. From these devices to all devices connected to internet we are talking about something very big, cloud computing, integration in the core systems and procedures modification. If we take here as an example smart cities, we can say that in some cities there are already multiple sensors with different functions and traffic monitoring and other things like that, but when we thinking about connecting all these together is a huge responsibility.

The Internet of Things (IoT) could generate an impresive economic growth in the next fifteen years. These impresive economic growth has also risks because neither goverment or companies are investing enough in this new technologie. There are people how want a better confort and are ready to pay for that. This can be translated in profit for companies.

Internet of Things permits a new digital facilities and business ideeas based on smart devices and machines connected between them. This thing is expected to enhance the economy growth and in the same time to help people to have a better life.

The risk is that the companies does not invest enough in IoT and they does not see the long term aproach, they are only thinking and the short time profit. In order to improve your business, you have to take into account an upcoming investment, that can be damped in the near future, thinking in the same time if this investment can increase youre profit.

Internet of Things could help company to improve productivity and to reduce costs. In figure 1, I presented different opportunities that can be developed using IoT.

Figure 1: Types of opportunities

All the things presented above can be seen or controlled by people from their personal phones or laptops. You can see in real time where a bus is, see images from a hospital with your beloved friend, connect to your house and turn off the lights, music, and gas etc. If you are on the road, a GPS can predict if the traffic will switch to red and tell with what speed to circulate, see the weather condition from a specific place, and check your personal office. There are also many things that can be done using IoT, but I can’t present all of them.

All this technologies are based on IP, because everything is connected to internet. The most advantage companies in this business are the telecommunication ones, which provide wireless internet connection. When IoT will be implemented, everything will be easier. The problem here is that many jobs will disappear and other will be created instead. We won’t see in the near future anymore a postman, or someone who reads your water and gas counter from your flat. It will be someone who will receive tones of data in front of a PC and just manage them with simple clicks.

What I presented so far can be implemented in states like U.S, Romania, Switzerland, Netherlands, but are also countries like Indonesia and Brazil which have a weaker support conditions. Here we can involve limited infrastructure, and weaker technologies. The government should come with helpful laws and help companies invest in the IoT.

These new concept can significantly enhance the efficiency and growth of the business economy, but the absence of support hold many countries back. Companies must be hand in hand with the government, in order to create new opportunities for companies.

                       Who started to see the advantages of IoT?

IoT make the users to believe in innovations such as fitness bands which follow your daily activity, self-driving cars, in all kind of appliances connected to internet and of course in systems of security.

Producers, small business and huge business like oil and gas companies started to see the advantages of IoT and made a huge investment in these technologies. Companies that provide technology are developing also an IoT based strategy in order to facilitate customers project, apply and manage complex structures.

There are 3 companies are investing a lot in IoT in order to build for us the smart cities. There are governments that started to update cities infrastructures. They want to develop smart roads, smart traffic lights and buses connected internet.

I will describe next three big companies that can transform our cities.

The first company that can improve our cities and in the same times our life is called ITRON. They offer many solutions for city modernization. This company was founded 40 years ago as a corporation based on electricity meter technology. Nowadays they offer end-to-end combined solutions, having a very good network infrastructure, data gathering servers, meter-data administration programs and other software solutions. ITRON offers programmer’s instruments necessary to project, to authorize and to create IoT applications. These instruments can have many applications in domains like water supply and administration, energy supply and delivery, IP connected traffic lights and solar monitoring. These software will work on devices connected through wireless or 3G, 4G radio connection.

They provide on their sites kits necessary for the developers. These kit used for development has an ITRON Riva board and instruments for cloud based analysis and monitoring sensors for network status. They can be used over WiFI, Ethernet, power line carrier (PLC), IPv4 and IPv6 interconnections.

ITRON has stated that their annual bookings and backlog has increased in the last years.

Figure 2: ITRON Annual Bookings and Backlog [2]

SOURCE: ITRON 2014 10-K.

In production it used frequently the term backlog, which means work that isn’t ready yet or when we talking about customers, orders that were received but are not complete yet.

While the company’s production is higher, that doesn’t transform into higher revenue. When a client tells you that he will invest money in your product is called “booking”. When the services are actually provided revenue happens. Even the ITRON revenue hadn’t increased yet, looking at the booking and backlog terms, we can assume that their revenues will increase in the next years.
Another Company which provides also IoT solutions is called Acuity Brands. They provide lighting resolutions not only outdoor but also indoor. The Acuity Brands Company made a business associate agreement with Sensity Systems, which provide a solution for the Light Sensor Network, a lighting solution connected to internet which improves energy consumption based on real time analysis.

There are a lot of applications for smart cities, for instance lighting improvement, smart parking and circuit monitoring. These solutions are at an incipient stage, because there are not so many users ready to pay for them.

Acuity success has increased over the years, earning a large share in the 2013 and 2014. In 2014 they reported the net sales of $2.4 billion, which represent an increase of 15% compared with the net sales from 2013.

The third company is called Silver Spring Networks and offers a base on which this new elegant and clever cities can be built. They announced that they signed a partnership with Acuity in order to modernize the smart lighting lights used in cities. According to what they say, if government invests in a new lighting system, they can reduce the energy costs by 40%, more than that, if they change also the light bulbs with LED lamps, they can save up to 60% electric energy, and improving in the same time the efficiency of the street lights.

Figure 3: Smart Light City Network [3]

SOURCE: SILVER SPRINGS.

The company stated that in 2014 they signed a contract with the France government to light up the Paris streets and traffic lights. This was a huge contract and great way for them to come into the light, based on the Paris name “City of Lights”. They deliver resolution for well-known cities around the world, adding here Melbourne”, “Sao Paolo” , “Singapore” and “Copenhagen. It is stated that this company is a leader in this industry, taking into account that they went on the market in 2013, which means that they are pretty new on the market and therefore doesn’t exists previous financial results.

Silver Spring had a backlog growth of 5% in 2014 compared with 2013, this indicator telling us that the success of the company is not guaranteed in the near future.

IoT seems to the next big project in the following years, but many huge industry giants are not ready to put their money in this market. Although IoT can create huge revenues for businesses, it has also greater security problems in his infrastructure.

Who else is investing in Internet of Things? IBM, Intel and Cisco are other huge corporates that invest in IoT. Amazon is also interest in IoT, because it hopes that using this solution will overtake its competitors in the cloud domain.

A huge investment was made in 2012; more exactly $752 million was invested around the world on IoT. Most of this money was invested in Cloud and Big Data plans.

Is The Internet of Things a Good Investment?

Each investor has the same question: Is it valuable to invest in IoT? The number of corporations and people that invest in this domain seem to suggest that it is. Nowadays it exist a huge unused market for smart devices, from vehicles that communicate between them in order to avoid traffic jams and crashes to devices that consume power during the peak hours. There are predicted up to 25 billion devices in 2020, from almost 5 billion nowadays.

IoT of things is not the only innovations. There is also cloud computing and social media in which is worth to invest. The currently option for the IoT funs is to invest in the individual stocks. This depends on each user acceptance for risk. But if you can find a company that grows and has a good price, the advantage definitely is there and of course is worth to invest in it.

Let’s take some examples of companies that made smart devices. Nest Labs, which are making the widespread Nest Learning Thermostat is possessed by Google. In figure 4, you can see this smart thermostat.

Figure 4: Nest Learning Thermostat [4]

Fitbit is a company that makes wearable fitness-tracking devices. If you thought about it few years ago it seems to be the perfect company to invest in, but now it faces many competitors and they are losing market share.

Figure 5: Fitbit devices [5]

Microsoft has also started to commercialize health wearable smart devices that checks user heart rate, calorie rate and sleep characteristics. And of course we can mention here also Apple, Samsung and the strongly Chinese called Huawei.

Kwikset propose a different approach, from my point of view is very useful, because this system can help you to close or to open the door from just using your phone. What you need is internet connection and an application. We can see how this device looks like in Figure 6.

Figure 6: Kwikset Home Connect system [6]

Belkin’s WeMo propose a different system that helps you to control from any internet connected device to reduce the energy consumption.

The WeMo has a sensor that detects motion up to 10 feet away, then it transmit a notification to the WeMo switch to turn on or off devices. It comes also with an application that permits you to turn on or off from remote location. In figure 7 is presented how it works.

Figure 7: Belkin’s WeMo[7]

If we want to invest in something big, we shouldn’t watch at the simple consumers. Industrial companies are ready to reduce their expenditures and handle their resources more cost-effectively, and for that they represent a better market user for IoT.

There are also other industrial suppliers that invest in IoT. We can mention here Monsanto, an agriculture giants which invested in a technology that helps farmer predict the weather. General Electric is another example of company that invested $1.5 billion in smart devices used in industry.

Is it practical lead to invest in IoT, aiming companies ready for the IoT expansion, but you should taking some risks and waiting enough time for the money comeback. Taking these into account, investing in IoT can be a cleaver decision.

IoT for Internet Service Providers

We spoke so far about sensors, different companies and different technologies that can improve our life. In order to dig deeper, we should solve a more important problem. How can all this devices be connected?

First of all we should remember that the IPv4 addresses are ending. We know that we can use the NAT technology, which can translates thousands of private IPv4 addresses into one public IPv4 address. It is an internet rule that say only IPv4 public addresses can travel through internet. The private addresses like 10.0.0.0/8, 172.16.0.0/12 and 192.168.0.0/16 can be reused, but the rest of IPs, which represent private IPs, will be consumed in the next 5 years.

Imagine what means that each devices to be connected to internet and I mean here everything, watches, mugs, windows, doors, TVs, washing machines, refrigerators, cars and the examples can go further.

In many communication service provider companies the migration to the IPv6 has begun. The current infrastructure of a Service Provider is not ready for the IoT. They are updating their transport links and their equipment, but that takes time and money. The transition is not easy.

Imagine millions of devices connected to internet and all the data that they generate. All this data must be transported somewhere. There should be implemented good QoS policies, which will provider to high link availability and a minimum guaranteed internet speed.

On the other hand, all this data that will pass through the internet service provider network will represent money. I mean here a lot of money. Imagine that in Romania are on the mobile telecommunication field 4 companies that provide inclusively internet. Romania has 20 million people and this is also the exact number of SIMs that these 4 companies provide. I want you to take a break from reading and make a simple imagination exercise. What you think will happen in the next 10 years when almost everyone will have many devices connected to internet. I will tell you what will happen. It will be a “boom”. The market telecommunication market will explode. The 20 million SIM number will double in the next years. This translates into a better economy and thus more jobs in telecommunication and IT field.

Companies have to work closely with the internet service provider in order to link the sensor technology to the network layer, in order to create a stable business.

This partnership won’t come easy to any parts. The internet communication consumers can fail to notice the problems associated with conceiving the perfect correlation mandatory to establish the complete advantage of IoT.

There was a predisposition between the internet service provider companies to contest the fact that they provide only “silly pipes”, something that disproved the businesses scientific superiority.

Who started to invest in IoT in Romania from the service provider field? Orange, Vodafone, Telekom, UPC and Digi started to fill up the cities with wireless devices which let the company customers to connect to internet. These wireless devices are provided by Cisco Meraki. They have different characteristics.

For example Orange has an application that provides to its customers statistics about the number of users that were in a specific place during a specific period of time.

Telekom is using wireless devices on taxis, letting the taxis customers to access free the internet. For this service pays the taxi company. In the near future they will have an application that will let you to see each taxi from a specific area and more than that you can reserve your taxi between specific hours and pay the command before at a preferential price.

Digi has wireless devices all around the country, but especially in Bucharest that permits to its customer connect free to internet in the area deserved by that wireless.

Vodafone has a service called M-Pesa that permits you to transfer virtual money all around the world using a Vodafone internet connection. M-Pesa lets utilizers to withdraw, deposit, transfer money and pay for different services very easy using a mobile device. This service will be taken by many internet providers in the near future, because it is possible that money to virtualize, being cheaper to transfer $1million using internet connection than to use a value transfer service.

In the next few years, 30% of data that pass every day through internet will be initiated from connected devices.

Telecommunication companies’ purpose is to support this ecosystem development, helping the market to grow and keeping their clients in the same time. They want to provide data protection and privacy, which translates into total data control to customers.

A fact is sure; Internet of Things will bring a lot of money to the telecommunication companies. In this way becoming one of the pylons of the future economy.

How IoT can improve our life?

The IoT is improving day by day appliances that encompassing our houses, work environments, streets and cities. Coffee-machines and refrigerators will never be the same. We will have smart home in which everything will be controlled from our smart phones. I am asking myself for how long would we use the word “smart”? Will this word “smart” become the most used word in the near future? It will be our lives better or we will become dumber and dumber every day? This is the thing that most people are afraid of. They are afraid that of losing their jobs. The jobs of people that reads your electric and gas counter won’t exist anymore.

From my point of view the transformation will take a lot of time and this expansion will happen first in developed country, where people leave pretty well. Everything will be connected to internet and that can transform IoT in a multi-billion dollar industry in the near future. But, can everyone take advantage of this money? Of course, like in each capitalist industry, it will be a group of people that will make a lot of money, around 98% of the wealth in world will be held by this small group of people. In fact if we want to know if our general wealth will increase, the answer is very difficult, because we will leave in better condition and things will be done in a simple and faster manner, but we have to work more, in order to have money for all this things.

IoT will help us to keep a better evidence of our general health, we can better select what to eat and we can keep an account of our calorie intake. We hope that in the near future won’t be any more traffic jams and the traffic transportation it will look more civilized. We can reduce the energy consumption.

Though, business can have more benefits from IoT than consumers. IoT might help user in achieving day by day purposes by improving their decision-making aptitudes.

Most of us were raised without computers, phones, smartphones and tablets with multiple applications. These new devices changed our life forever and it will never be the same again. But this is not the end. We can leave even better as before. The life expectancy has improved compared to the 20th century. But we should pay more attention, because from now on we will face many changes: Faster computers, artificial intelligence and maybe cyborgs. In 15 years when we will look back we will ask our self how we can leave with such prehistoric technology. I think the difference between 2030 and today will be bigger than today and 90’. According to Google’s director predictions, in 2030 we will face computers smarter than human beings and in 2045 we will have computer billion times more powerful than all human brains on Earth. Once that happen, the civilization will change radically. A fact is sure, evolution is unpredictable and irreversible. How will be our lives? I can just hope that will be better and that this evolution will help us to leave longer and happier.

What is the real problem? I think the real problem is that people are introverts and technology is not the cause of this. Twenty years ago they read newspaper instead of speaking with each other. Now they use the smartphone or tablets all day for reading, playing games or watching videos on their. This is the real problem, that we become more and more addicted to technology.

Another problem is that jobs are dissolving faster that they are created. This process will speed-up when the technology will progress. This can translates into social instability. All the wealth in the world will belong to 1% of the population. All work will be performed by different applications and technologies. In the future won’t exist anymore the cheaper products produced in China, the cheaper products will be in future created by robots. Of course that the products will be better, but the human population will decrease. This is definitely a nightmare.

Lucky for us, that in the engineering companies, technology is not use to replace human beings, but to make the employees more productive. In this way the economic production will increase.

We can avoid all this if we are smart enough, having a simpler life in which we will leave healthier.

It will exist systems that will control air pollution. The air pollution is one of the biggest problem nowadays in Asia and Europe. There will be computers that will plant trees and will inform you in case of forest fires.

Having all this in mind, the new connected world will bring essential changes to humanity and to customers. Identifying nearby environment, we can say that IoT will improve our world and our life, improving our comfort, health and security, while at the same time reducing energy consumption. Internet of things will transform our actual lives and the general wealth will increase.

IoT will introduce a bigger transformation than Internet itself. When we ask children how the world before internet was, they can’t say a word. They don’t how could people send messages or even live without internet. In ten years it will happen the same thing with IoT. The young population will be the most affected. We will be related to the permanent stream of data provided by our smart phones, wearable devices and other smart appliances. We will take smarter decision based on data provided by this smart devices. The work time will be reduce and the efficiency will be increased. In figure 8 we can see how everything in our house can be controlled using a smart phone. IoT can really change our lives.

Figure 8: IoT is improving our lifestyle [8]

Conclusions

The digitization of machines, vehicles, and other elements of the physical world is a powerful idea. Even at this early stage, the Internet of Things is starting to have real impact. The Internet of Things is changing how goods are made and distributed, how products are serviced and refined, and how doctors and patients manage health and wellness. By examining the proliferating uses of the Internet of Things in specific settings, we have been able to estimate the magnitude of potential economic impact from IoT applications over the next ten years. Capturing that potential will require innovation in IoT technologies and business models, and investment in new capabilities and talent. With policy actions to encourage interoperability, ensure security, and protect privacy and property rights, the Internet of Things can begin to reach its full potential.

References:

[1] – www.luxcapital.com/blog/internet-of-things-needs-a-new-interface

[2] – www.itron.com

[3] – www.silverspringnet.com/

[4] – https://nest.com/thermostat/meet-nest-thermostat/

[5] – https://www.fitbit.com

[6] – http://www.kwikset.com/

[7] – http://www.belkin.com/us/Products

[8] – http://www.business2community.com/tech-gadgets/without-identity-internet-things-just-noise-01135947#aVRb7pkqLkwsHEUL.97

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