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The greatest advantage we have today is our ability to communicate with one another.
The  Internet of Things, also known as IoT, allows machines, computers, mobile or other smart devices to communicate with each other. Thanks to tags and sensors which collect data, which can be used to our advantage in numerous ways.
IoT has really stormed the  Digital Transformation. It is estimated that 50 billion devices connected to the Internet worldwide by 2020.
Let us have the Good news first:
  • Smart Cars will communicate with traffic lights to improve traffic, find a parking spot, lower insurance rates based on telematics data
  • Smart Homes will have connected controls like temperature, electricity, cameras for safety and watch over your kids
  • Smart healthcare devices will remind patients to take their medication, tell doctors when a refill is needed & help curb diabetic attacks, monitor symptoms and help disease prevention in real time, including in remote areas
  • Smart Cities & Smart Industries are the buzz-words in IT policies of many governments
  • With sensors and IoT enabled Robots used in Manufacturing - new products could potentially cost less in the future, which promotes better standards of living up and down all household income levels
  • Hyper-Personalization – with Bluetooth, NFC, and Wi-Fi all the connected devices can be used for specifically tailored advertising based on the preferences of the individual
  • Real time alerts in daily life - The Egg Minder tray holds 14 eggs in your refrigerator. It also sends a wireless signal to your phone to let you know how many eggs are in it and which ones are going bad.

Now here are the Bad things:

  • There are no international standards of compatibility that current exist at the macro level for the Internet of Things
  • No cross-industry technology reference architecture that will allow for true interoperability and ease of deployment
  • All the mundane work can be transferred to Robots and there is potential to loss of jobs
  •  All smart connected devices are expensive – Nest the learning thermostat cost about $250 as against $25 for a standard which gets a job done. Philips wireless controlled light cost $60 so your household will be huge expense to be remotely controlled

And the Ugly part:

  • Remember the Fire Sale of Die Hard movie, a Cyber-attack on nation’s computer infrastructure - shutting down transportation systems, disabling financial systems and turning off public utility systems. Cyber-attacks can become common when devices are sold without proper updated software for connectivity
  • Your life is open to hackers who can intercept your communications with individual devices and encroach your privacy. Imagine a criminal who can hack your smart metering utility system & identify when usage drops and assume that means nobody is home
  • Imagine when you get into your fully connected self-driving car, and with some hacking a stalker’s voice come up from speaker “your have been taken” and you may not find Liam Neeson anywhere nearby, to rescue you.

All the consumer digital footprints can be mined, aggregated, and analyzed via  Big Data to  predict your presence, intent, sentiment, and behavior, which can be used in a good way and bad way.
We just need to manage the safety and privacy concerns to make sure we can receive the full benefits of this technology without assuming unnecessary risks.
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Guest post by Preston Tesvich. This article originally appeared here.

Let’s say you’re in the planning phase of an IoT project. You have a lot of decisions to make, and maybe you're not sure where to start:

 

In this article, we focus on a framework of how you can think about this problem of standards, protocols, and radios. 

The framework of course depends on if your deployment is going to be internal, such as in a factory, or external, such as a consumer product. In this conversation we’ll focus on products that are launching externally to a wider audience of customers, and for that we have a lot to consider.

Let’s look at the state of the IoT right now— bottom line, there’s not a standard that’s so prolific or significant that you’re making a mistake by not using it. What we want to do, then, is pick the thing that solves the problem that we have as closely as possible and has acceptable costs to implement and scale, and not worry too much about fortune telling the future popularity of that standard.  

So, it first comes down to technical constraints:
    - What are the range and bandwidth requirements? 
    - How many nodes are going to be supported in the network?
    - What is the cost for the radio? 


That radio choice has big impacts—not only is it a hefty line item on your BOM on its own, it’s also going to determine the resources that the device needs as well. For example, if you have a WiFi radio at the end, there’s considerable CPU and memory expectations, whereas if we have BLE or some mesh network, it’ll need a lot less. There’s infrastructure scaling costs to consider as well. If we go WiFi: is there WiFi infrastructure already in place where this is being deployed? How reliable is it? If we’re starting from scratch, what’s the plan for covering a large area? That can become very costly, especially if you’re using industrial grade access points, so it’s important to consider these effects that are downstream of your decision.

Zooming in on specific standards

In our opinion, the biggest misconception we find: “Isn’t there going to be one standard to rule them all?” There’s no future of that, and it’s not just because we’re never going to all agree on stuff as an industry, it’s because in many cases different standards aren’t solving the same problems differently, they are solving different problems. So understanding that, we can now look at what each protocol attempts to solve and where they live on the OSI model, or "the stack."

 

MQTT

Some would suggest that it is a full protocol to do communication from a device to a server, but it’s not quite that. MQTT is used as a data format to communicate to something, and that payload can be sent over any transport, be it WiFi, mesh, or some socket protocol. What it tries to solve is to define a way to manipulate attributes of some thing. It centers around reading and writing properties, which lends itself very well to an IoT problem. It certainly saves development time in some regards, but depending on how strictly you’re trying to implement it, it may cost you more development time. As soon as you one-off any part of it, you have to document it really well, and at some point you approach a time and cost factor where implementing your own payload scheme may be a better option.

Is it prolific enough to where you should absolutely use it? No, it hasn't reached that level, and it won’t likely reach that level. What it is right now is a convenient standard for device-direct-to-cloud where we don’t control both ends because it gives some measure of a common language that we can agree on; however, the thing to keep in mind is that most of the time it does in fact need additional documentation—what properties are being read/written and what the exact implementation looks like—ultimately, you’re not getting out of a lot of work using MQTT.

Zigbee and Z-wave

Also starting at the network layer, Zigbee and Z-wave are the big incumbents everyone likes for mesh networking. They attempt to solve two problems: provide a reasonable specification to move packets from one place to another on a mesh network, and actually suggest how those packets should be structured; so, they both reach up higher in the stack. And that's the part hinders their futures. For example, Zigbee uses a system called profiles, which are collections of capabilities, such as the smart energy profile or the home automation profile. When a protocol gets so specific as to say ‘this is what a light bulb does’ it’s pretty difficult to implement devices that aren’t included in the profile. While there are provisions for custom data, you’re not really using a cross-compatible spec at that point—you’re basically off the standard as soon as you’re working with a device not defined in the profile.  

The other consideration with these two is that they are both routed mesh networks. We use one node to communicate with another node using intervening nodes. In other words, we can send a message from A to B to C to D, but in practice we’ve sent a message from A to D. As routed meshes, each node understands the path the message needs to take, and that has an in-memory cost associated with it. While Z-wave and Zigbee have a theoretical limit of 65,535 nodes on a network (the address space is a 16-bit integer), the practical limit is closer to few hundred nodes, because these devices are usually low power, low memory devices. The routing also has a time cost, so a large mesh network may manifest unacceptable latency for your use case. Another consideration, especially if you’re launching a cloud controlled consumer product, is that these mesh networks can’t directly connect to the internet—they require an intervening bridge (a.k.a gateway, hub, edge server) to communicate to the cloud.   

A final caveat is that Z-wave is a single source supplier—the radios are made and sold by Zensys, so you have to buy it from them. Zigbee has a certification process, and there are multiple suppliers of the radio, from Atmel to TI.

Bluetooth

You really just can’t compete with the amount of silicon being shipped based on Bluetooth. 10,000 unique SKUs were launched in Bluetooth in 2014. Other than WiFi, there’s nothing that compares in terms of adoption. Bluetooth was originally designed for  ‘personal area networks,’  with the original standard supporting 7 concurrent devices. And now we have Bluetooth low energy (BLE) which has a theoretically infinite limit. BLE did a ton to optimize around IoT challenges. They looked heavily at the amount of energy required to support a communication. They considered every facet of "low energy," not just the radio-- they looked at data format, packet size, how long the radio needed to be on to transmit those packets, how much memory was required to support it, what the power cost was for that memory, and what the protocol expects of the CPU, all while keeping overall BOM costs in mind. For example, they figured out that the radio should only be on for 1.5ms at a time. That’s a sweet spot—if you transmit for longer, the components heat up and thus require more power. They also figured out that button cell batteries are better at delivering power in short bursts as opposed to continuously. Further, they optimized it to be really durable against WiFi interference because the protocols share the same radio space (2.4GHz).

And then CSR came along and implemented a mesh standard over Bluetooth. Take all the advantages afforded with BLE, and then get all the benefits of a mesh network. The Bluetooth Mesh is flood mesh, meaning instead of specific routing to nodes, a message is sent indiscriminately across all nodes. This scales better than routed mesh because there’s no memory constraints. It’s a good solution for many problems in the IoT and at scale is probably going to be the lowest cost to implement. 

Thread

An up and coming standard that’s built on top of the same silicon that powers the Zigbee radio. It solves the problem of mesh nodes not being able to communicate directly to the cloud by adding IPv6 support, meaning that nodes on the network can make fully qualified internet requests. There’s a lot of weight behind this standard. Google seems to think it’s interesting enough to make their own protocol (known as “Weave”) on top of it. And then there’s Nest Weave which is some other version of Google Weave. As it stands, it takes a long time for a standard to really take hold-- you can immediately see how the story with Thread is a little muddier, which will not help its adoption. It’s also solving a problem that it just doesn’t seem that many devices have. Let’s take sensors as an example. Do these low power, lightweight, low cost, low memory, low processing, fairly dumb devices NEED to make internet requests directly? With Thread, each node now knows a lot more about the world—where your servers are for example, and maybe they shouldn’t be concerned with those things, because not only do the requirements of the device increase, but now the probability and frequency of having to update them in the field goes way up. When it comes to the actual sensors and other endpoints, philosophically you want minimize those responsibilities, except in special cases where offline durability, local processing and decision making is required (this is called fog computing).

When Thread announced their product certification last year, only 30 products submitted. Another thing to note about Thread's adoption is that the mesh-IPv6 problem has been solved before-- there’s actually a spec in Bluetooth 4.2 that adds IPv6 routing to Bluetooth, but very few people are using it. Although Nordic Semiconductor thought it was going to be a big deal and went ahead and implemented it first, it just hasn’t come up much in the industry—that happened Q4 2014 and no one’s talking about it.

One thing Thread does have going for it is that it steps out of defining how devices talk to each other, and how devices format their data—doing this makes it more future proof. This is where Weave comes in, because it does suppose how the data should be structured. So basically a way to look at it is that Weave + Thread = direct Zigbee/Z-wave competitor. We haven’t seen anyone outside of Google really take an initiative on Weave, other than Nest who have put a good marketing effort into making it look like they are getting traction with it.

AllJoyn

Other protocols live higher in the stack and remain agnostic at the network layer. The most well known of these is probably Qualcomm’s Alljoyn effort. They have the Allseen Alliance, although their branding is a bit murky—Allplay, AllShare, etc. We’ve seen some traction with it, but not a ton-- the biggest concern that it’s fighting is that it’s a really open ended protocol, loosely defined enough that you’re really not going to build something totally interoperable with everything else. That’s a big risk for product teams. If there aren’t enough devices in the world that speak that language, then why do I need to speak it? That said, LIFX implemented it, and it worked really well for them, especially since Windows implemented it as well. Now it’s part of Windows 10—there’s a layer specifically for AllJoyn stuff and it seems to do well. There's evidence with AllJoyn that you can bring devices to the table that don’t know anything about each other and get some kind of durable interoperability. However, at a glance, it seems complicated—the way authorization is dealt with and the way devices need to negotiate with each other. There really isn't runaway adoption

IEEE’s WiFi

They’ve ruled the roost with their 802.11 series. B then G then A, and now we have AC. 802.11 has been really good at being simple to set up and being high bandwidth. It doesn’t care about power consumption, it’s more concerned with performance because it’s meant to be a replacement for wires. Almost 2 years ago, they announced 802.11 AH which they’ve branded as HaLow, which attempts to address power, range, and pairing concerns of classic WiFi. Most WiFi devices are not headless ("headless" - no display or other input), they have a rich user interface—meaning we can login and configure them to connect to WiFi. Pairing headless devices has been a very tedious process. With HaLow, they’re solving two problems—how do we get things on easier, and how do we decrease the expectations (particularly power) of the device running the radio. It’s too early to know what type of traction this will get, but IEEE has a great track record at standards adoption.

LoRa and SIGFOX

More like: LoRa vs. SIGFOX. With these protocols we’re looking at how to connect things over fairly long distances, such as in smart city applications. LoRaWAN is an open protocol that's following a bottoms-up adoption strategy. SIGFOX is building out the infrastructure from the top down, and handing APIs to their customers. In that way, SIGFOX is more like a service. It'll be interesting to see the dance-off between these two as the IoT is adopted in these more public-type applications. 

That’s the body of standards that need to be addressed. There’s a ton more, but we don’t see them as exciting for the IoT today.

- P

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Guest blog post by Bill Vorhies

Summary:  Sensors that know how you feel?  Sensors that want to change the way you feel?  When did that happen and better yet how?

 

We’re getting used to sensors finding out what we’re doing.  Apparently they are now sufficiently sophisticated that they can even tell if I’m sitting up straight (yes Mom – BTW using a camera is almost cheating, you should be able to do this with just an accelerometer and a gyro). 

But what if I told you that those same IoT sensors can tell how you feel?  And now they’re even being programmed to change the way you feel!  A little creepy?  Feeling manipulated?  Hang on to your hat because it’s about to get worse or better depending on your point of view.

 

Mood Science

First of all I didn’t even realize that ‘mood science’ is a real thing.  Turns out it’s been going on a long time in design circles where designers and architects in particular have been making informed guesses at what chills us out.  Blue rooms relax.  Red rooms stimulate and arouse.  Pink rooms are most soothing. 

Interesting note: For years many prisons have been painting their walls bright pink based on early findings that prison inmates’ tempers were soothed when placed in pink-walled cells.  For what it’s worth these generalizations about room color have all now been overturned by the new practitioners of ‘mood science’.

I’ve been tracking the uses of IoT sensors particularly those with human interaction (think Fitbit) but I didn’t see the big picture until I came across this article “Design for Mood: Twenty Activity-Based Opportunities to Design for Mood Regulation” by Pieter M. A. Desmet, a member of the Faculty of Industrial Design Engineering, Delft University of Technology.  This is one of those articles you know you should trust because it contains a reference bibliography of 169 learned articles.

For the most part it seems that in academic circles the desire to determine how to ‘regulate mood’ is pretty benign and generally couched in terms like improving subjective well-being.  After all who doesn’t want an extra helping of well-being?

Then I found it.  About three pages in, buried in the text:

  • Mood influences consumer behavior. Research has demonstrated that consumer mood influences buying behavior, product preference, and purchase decisions.
  • When evaluating new products, people do so more favorably when in a good mood than when in a bad mood.
  • Mood influences user behavior. For example, when using new products, individuals in a bad mood tend to explore fewer interaction possibilities than those who are in a good mood.
  • A good mood increases one’s willingness and motivation to adopt and use new technologies.

OK, now it’s clear.  Just sending me a coupon when I’m standing next to the new flat screens isn’t nearly enough.  “They” want to know how I’m feeling, and better yet to make me feel in a way that positively disposes me to buy.

One more piece of foundational information before we move on to how this works.  Turns out that monitoring and manipulating mood (feelings) through just four quadrants and eight basic mood types is enough to make this happen.

When it comes time to model, one of these eight states will be our dependent target variable.

 

How It Works

How would sensors go about detecting mood?  It’s all about cleverly combining and interpreting the signals.  This is a fairly new field studying how to fuse sensor data to make it context aware.  Take for example heart rate as measured by a wearable sensor.

Dr. José Fernández Villaseñor is a medical doctor and electrical engineer studying the field of emotion analysis using sensors.  His research shows the rate at which heart rate increases can differentiate between exercise and increases due to adrenalin from excitation based on the slope of the increase.  Turns out that Heart Rate Variability (HRV) is one of the prime tells that can be used to differentiate one mood from another.

Here’s a simple example of how your Xbox or PS4 can not only tell how you’re feeling but manipulate those feelings. 

image source: mouser.com

You are playing a driving game.  Your game controller may contain sensors that can detect:

  • Muscle relaxation (MR)—via a pressure sensor.
  • Heart rate variability (HRV)—via a two-electrode ECG on a chip.
  • Sweat (S)—via a capacitive sensor.
  • Attitude (A)—via an accelerometer monitoring a person’s state of relaxation (jerky movements vs. steady hands).
  • Muscle contraction (MC)—via a pressure sensor.

Suppose the combination of increased pressure on the controller, sweat, and the jerkiness of your motions (from the accelerometer) could be correlated (modeled) against your performance in the game.

Pressure and sweat increase.  Jerkiness increases.  Your game platform infers that you are both excited and stressed.  Your score is just OK.  To encourage you to play more, the system adjusts the difficulty of controlling the steering, braking, and the behavior of the other cars to reduce difficulty.

Your performance and score improves.  Pressure and sweat decrease and your hand movements become smoother.  The platform interprets that you are more relaxed and are mastering the game at this level.  To keep you involved it increases excitement by making input controls and the behavior of competing cars more difficult.

You’ve just been gamed in the new world of IoT mood manipulation.

 

It’s Not Just About Wearables

In a sense, if you’re worried about the intrusiveness of this technology you would think that wearables offer their own defense – just don’t wear them (leave the Fitbit at home).  Problem is it’s not just wearables.  There are at least four categories of things that supply data about ourselves, many of which you may not have thought of in this way.

Wearables:

Wearables is a big one.  It’s not just where you are and how fast you got there (GPS, accelerometers, altimeters, thermistors, gyros) it’s also sensors that measure physiological signals such as heart rate, skin conductance and temperature, and respiratory rate.  These already include finger rings, ear rings, wristwatches, wrist and arm bands, and gloves.  Soon to come, sensorized garments including shirts, shoes, and underwear.

Take a look at the W/Me wearable wellness monitor introduced in 2013 that claims to measure the four basic mood states: passive, excitable, pessimistic, and anxious.

Natural-Contact Sensors

These are sensors that are integrated into the devices and particularly the surfaces of objects we regularly come in contact with.  Likely you are interacting with these objects, not just brushing up against them. How about the steering wheel of your car that could easily have these sensors embedded and also transmit information about the smoothness or jerkiness of your movements.

It could be a chair that infers your stress or relaxation or a pen, cell phone, or mouse that can detect moods like stress, nervousness, and excitement based on hand movement.  Even your keyboard can give you away by interpreting the strength and cadence of your keystrokes or how many times you use the backspace key.

Non-Contact Sensors

Anything with a camera or a microphone: computer, phone, TV, or game console that could use visual signal processing (deep learning) to record facial and voice expression, body posture, pupil diameter, and eyelid closure patterns.  Law enforcement is hard at work adopting facial and emotion detecting software.

Self Expression

Sometimes we just tell machines how we feel.  I frequently tell my alarm clock how I feel when I give it a rough slap (there could be a sensor in there warning my family I’m in a bad mood when I come out for breakfast).  About 8 years ago Philips developed a ‘mood pad’ for hotel rooms that let you pick a mood (romantic, restful, let me sleep) that controlled ambient lighting.  And if you look in your app store, I’m sure you can find an app for creating a mood journal or for evaluating how you feel right now.  Who’s receiving that signal?

 

What Could Possibly Go Wrong?

This question is almost too rhetorical to even ask.  If you want to make me more likely to buy something, OK, maybe I can live with that.  And if it makes my game play more interesting that might go on the good list.  If your car tells you you’re suddenly suffering from road rage that could be helpful.  And certainly there are applications in healthcare, mental care, and elder care that we can easily applaud.

But when it comes to manipulating me I really want to know who’s doing it and with what motive.  What could the government or the IRS be learning about me or trying to make me do?  I don’t want to seem alarmist.  Sometimes the best thing we can do is just make ourselves aware that this is happening.  Maybe there will be an on-package or on-screen disclaimer (probably buried deep in the EULA). 

This is one of those technological advances that delights me as a data scientist and disturbs me as a citizen and human being.  Like all technological advances this one’s out of the bottle and trying to get it back in would make the loaves and fishes look like child’s play.  As much as anything, I just want to know if I’m getting some quid for my quo.

 

 

About the author:  Bill Vorhies is Editorial Director for Data Science Central and has practiced as a data scientist and commercial predictive modeler since 2001.  He can be reached at:

 

[email protected]

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Guest blog post by Jason Li

Connected devices, Smart City, home automation, e-health, Big Data ... In recent years, the concepts of communicating objects have multiplied. In reality, they are all one facet of the same upheaval - the Internet of Things.

Cars can be driven without a driver, TVs are going online, and heating systems are activated automatically to the arrival of the residents. The Internet is making many processes in daily life easier. The Internet of Things, or IoT, which enable devices to communicate with people or machines, is actually working in many places in our daily life already.

Further reading:

For People: Web-Enabled Electronics 

If phone and computer without Internet access, they become unthinkable devices. Meanwhile, this is also valid for televisions and audio devices or cameras. New electronic products will not come without Internet in the future. For example, wearables are the typical types of Web-enabled electronic devices which are worn directly on the body for health monitoring, have become the next big trend in healthcare.

Further reading:

For Home: Smart Home 

Manufacturers not only produce Internet-enabled home appliances, but also care about apps and software portals. For example, Miele combines a range hood with the stove so that the fan motor is automatically adapted to the cooking process.

The smart home concept has created many great ideas - shutters can be controlled by smartphone, and lights and heats can be turned before you returning home from vacation. Germany’s digital association Bitkom assumed that there will be one million fully networked households by 2020.

Further reading:

For Transportation: Connected cars 

In a survey, the respondent indicated that the smartphone connection in the car was more important than a higher horsepower. In the world of connected cars, drivers, cars and infrastructures are all connected with each other, and are able to communicate among objects in the system in real-time to optimize routes and avoid accidents.

The concept of autonomous cars has taken the step further towards making self-driving cars. Major car manufacturers promised to produce at least one business model within the next five years.

Further reading:

For Community: Smart City 

In 2050, our planet will be different from today – There will be nine billion people live on it, 70% of them live in cities. This growing trend has not only significantly increased demands in cities, but also created great opportunities to improve efficiency of energy, material and human resources.

The Smart City concept was created to exploit these opportunities with aims to integrate information and communication in various technical systems of a city to promote innovative solutions for mobility, management and public safety in the city – in particular, electricity, water, gas, and goods.

Further reading:

For Agriculture: Digital Agriculture 

“According to the United Nations’ Food and Agriculture Organization, food production must increase with 60% to be able to feed the growing population expected to hit 9 billion in 2050. John Deere uses big data to step into the future of farming to help farmers achieve this ambitious target.”(Datafloq)

The networked agriculture can benefit in many places of databases and real-time monitoring – The balance of weather data with the plant growth data, and the complex structure of the forecasted demand and the current market.

Further reading: 

For Manufacturing: Industry 4.0 

Industry 4.0 represents the manufacturing future with IoT. High demands are made on the production of the future – you must be intelligent, changeable, efficient and sustainable. Industry 4.0 stands for the intelligent networking of product development, production, logistics and customer.

The Industry 4.0 Working Group define Industry 4.0 as “a network of autonomous, controlled situational itself, configure itself, knowledge-based, sensor-based and spatially distributed production resources (production machines, robots, conveyor and storage systems, resources), including their planning and control systems”.

Further reading:

Digital Industry 4.0 – It is All about the Manufacturing Future with IoT

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Image: Lorenzo Franceschi-Bicchierai/Vice Motherboard

By Ben Dickson. This article originally appeared here

At the recent Def Con hacking conference in Las Vegas, two researchers from cybersecurity firm Pen Test Partners showed that they could inflict your smart thermostat with ransomware from hundreds of miles away, and force you to fork over cash (usually bitcoins) before you could regain control of the appliance.

Ransomware has been around for a while. It’s a breed of malware that locks down access to your files by encrypting them and sells you the decryption key that will give you back access to the files. IoT ransomware is relatively new. However, this isn’t the first time that the topic of IoT ransomware has been brought up by cybersecurity experts. Experts from Symantec presented a research on ransomware for wearables (aka “ransomwear”) last year at the Black Hat conference. The issue was also raised by experts at the Institute for Critical Technology (ICIT), specifically in regards to healthcare IoT.

Unfortunately, though, IoT ransomware isn’t being given enough attention, or not being looked at from the right perspective, which can lead to its underestimation and disastrous outcomes that could result not only in financial losses, but in loss of life as well.

Why is IoT ransomware being underrated?

The fact that IoT ransomware is not being given enough attention stems from the fact that it is being perceived in the same light as traditional ransomware.

However there are two key differences.

The classic ransomware model owes its success to its irreversibleness. When your PC, laptop or smartphone becomes inflicted with ransomware, your valuable files are encrypted and the only thing that can give you back those files is the private key, which is in the hands of the culprits (that is unless you have a backup of your files).

And that is why you’re left with no other option than to pay the ransom. That’s why even theFBI recommends to pay the ransom.

That is simply not feasible with IoT. First of all, with most IoT data being stored in the cloud, there’s little or nothing of value on the devices themselves. So even if the data becomes encrypted, there’s little incentive for the owner to pay the ransom.

Which means, ransomware attackers will have to fall back to the older form of ransomware, the one that locks your device and ransoms you for regaining access to its functionality. And that is as trivial to overcome as resetting the device and installing new patches and updates, which is even easier to accomplish with IoT devices than PCs.

The second argument that discredits IoT ransomware has to do with the perspective of the attackers. Ransomware developers are always looking to make the most money for the least effort. So an exploit of Windows or Adobe Flash or Internet Explorer will enable hackers to target hundreds of millions of users. But IoT devices are so various that each of them would have to be targeted in a different way, which would make it more of a challenge for hackers.

There’s also the minor issue of needing a user interface such as a screen display to inform the user that they’ve been hacked by ransomware. A considerable percentage of IoT devices lack any display mechanism and the hackers will have to go the extra step of discovering the user’s email or hacking the app that controls the device as well.

These factors will not create enough financial motivation for hackers to invest in IoT ransomware. Or so we think.

Why should it be taken seriously?

The correct use of IoT ransomware hinges on being timely and critical, not on being irreversible. The entire point is to strike at the target at a time and place where they won’t be able to reset the device or counter the effects of the ransomware and will be more willing to pay the ransom.

So instead of looking for valuable files on your Nest Thermostat, hackers will lock it up with ransomware while you’re away on vacation and send you a notification to tell you that your smart home has been hacked and you either have to pay a ransom or the thermostat gets locked at a high temperature. By the time you fly back home to disable or reset the thermostat, your home will get fried, and if not, you’ll have to settle for the huge electricity bill that will come at the end of the month because of the active use of the appliance.

In the connected car industry, hackers will track you down and hack your car while you’re on a desert highway, with no means to fix the problem on your own and no access to service centers. Then you’ll be forced to either cooperate with the hackers or hitchhike your way to the nearest city to get help.

In industrial IoT, things can get even nastier. Imagine a hacked power grid (and these things do happen). The hackers won’t give you 48 or 72 hours to hand over the cash, as is the case with traditional ransomware. They’ll give you 30 or 45 minutes turn over bitcoins. And after that, it’ll be total blackout.

Medical IoT can become an attractive target for ransomware as well. Your pacemaker or drug infusion pump in the control of hackers can be a dangerous situation. How about handing over a bitcoin or seeing your heart skip a beat?

Final words

The IoT ransomware model is fundamentally different from the computer and laptop paradigm, but no less dangerous. It is only a matter of time before hackers decide it’s worth their time and try their hand at hacking IoT devices for ransom. This is another reminder of the cybersecurity tradeoffs that IoT poses on consumers.

What’s important is that we keep our vigil and stay prepared to protect ourselves and our devices against such attacks. I will soon be writing about IoT ransomware and the possible solutions. I welcome any sort of expert opinion on the topic.

Image Source: Lorenzo Franceschi-Bicchierai/Vice Motherboard

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internet of things

By Ben Dickson. This article originally appeared here

The Internet of Things is the connection of things beyond your computer and laptop – physical things – to the internet. It has enormous potential for both customers and manufacturers. It’s today’s buzzword. And it’s everywhere. It will soon invade our lives in ways that were unimaginable before, and there’s no stopping it. If you’re a consumer, IoT might have become part of your life without you knowing it. And if you’re a manufacturer, you should start thinking about making your products “smart,” lest you lose the competitive edge against your rivals.

That’s the basic mindset that drives manufacturers in virtually every industry toward integrating internet connectivity into their newest products without thinking about the requirements, implications, challenges and pitfalls. And that’s where they stop: connectivity.

I would call it “barely scratching the surface,” but I think even that would be an overstatement. In reality, it’s worse than that. A recent Forrester research commissioned by Xively showed that 62 percent of companies are just looking to differentiate their brand through adding connectivity to their products. But with more and more companies creating connected devices, connectivity per se is no longer a unique differentiator.

No wonder we’re seeing vulgar references being made to the IoT since a lot of new IoT devices end up creating more trouble and headaches than utility and efficiency. And this is the phenomenon that is supposed to trigger the next digital revolution.

Creating a successful IoT project is much more than just linking your next product to the internet. Here is what you should know before getting engaged in the manufacturing of your next smart appliance.

Security and privacy

One of the main failings of IoT manufacturers is to take security and privacy issues into account before developing and shipping their products. The result is fridges that leak Gmail credentialslight bulbs that leak Wi-Fi networkstoys that spy on kidsTVs that spy on viewers, and the list goes on.

As long as security comes as an afterthought and not as a main area of focus, we’ll be seeing IoT being referred to as one of the most insecure sectors of the tech industry.

Aside from security, privacy is another serious topic of content in IoT. With so much personal data being collected by IoT devices, manufacturers must – and unfortunately don’t – consider the privacy implications before shipping products. Much of this data is subject to regulations such as HIPAA.

So sensitive data must be encrypted whether it’s on the device or in the cloud or while it’s being transferred. Sensitive data shouldn’t be stored at all. Data that is being shared with third parties must be vetted and anonymized.

Users should be able to opt out of data collection programs and should be fully informed about the type of data that is being collected.

Long story short, there are a lot of security and privacy complexities that you need to consider and plan for before diving into the project.

User experience and compatibility

What kind of technologies will this device of yours be using? Is it compatible with other appliances or gadgets that potential consumers will have installed in their home? Do they need to purchase and install a new router just because of your product? Is it really necessary that they install a new mobile app for your device only?

What are the possible scenarios where users would want to connect their devices through platforms such as IFTTT? Does your IoT platform support that?

These are all important questions that you need to answer in regard to your IoT product.

It is imperative that your product seamlessly blend into the connected life of your clients without adding complexities, frustration and extra steps. Also, it is important that your technology be able to work in a legacy environment, so it should be able to continue functioning disconnected. It would be very embarrassing if your customers wouldn’t be able to turn on the lights because they’ve lost internet connectivity (I’ve discussed some potential solutions to this problem here and here).

The point is, if your device ends up being a disconnect island in the IoT ecosystem of your consumers that has to be managed separately, there’s a likely chance that the consumers will abandon it and take their chances with some other brand.

So you should think out of the box and in the broader scope when designing your IoT product. Also plan for the future, and if you’ll be manufacturing other IoT products in the same line in the future, consider how these devices will correlate and how you can standardize your IoT product line to improve compatibility.

Data management

The true potential of the IoT lies in its ability to gather data, glean insights and make smart decisions which lead to improved user experience, better efficiency, costs savings, etc. But unfortunately, most companies stop at the gathering phase, piling up reams of data in their cloud servers and making minimal use of it. According to the Xively report, only about one third of firms are leveraging captured connected device data to provide insight to internal stakeholders and partners, personalize interactions with customers, or profile and segment customers.

This is a missed opportunity for leveraging customer data, as most companies focus their time on just connecting products rather than creating actionable insights from the captured data. Companies should leverage third-party analytics and machine learning services to do a host of activities such as integrating data gathered from IoT devices with previous data they have about their customers. This can enable them to better segment their customers and categorize them based on their preferences and device usage.

Also, data gathered from devices can provide the best feedback to improve existing products. By examining how devices are being used, manufacturers can find the strengths and failings of their products and make software and hardware design decisions to improve their current and future products. Naturally, your first IoT device won’t contain all the relevant features and characteristics that end users will expect form a smart appliance. Device data can help you correct your development path in the future.

There’s much more

These are just some of the considerations that can help you get your feet wet with IoT design and development challenges. The full list can be much more comprehensive. For instance, I didn’t even touch upon the issue of support and management, which deals with updating mechanisms and customer support.

What challenges do you face when designing your IoT products? How do you deal with them? Please share with us in the comments section.

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Big data in ranching and animal husbandry

Guest blog post by Brian Rowe

Another big part of the food supply comes from ranches and farms that raise and slaughter various livestock. While ranching is sometimes bundled with agriculture, I discussed farming in Big Data in Agriculture, so we’ll focus on ranching this time around. Somewhat surprising is that big data usage in ranching appears more limited than in farming. That said, there are a number of novel uses of technology and data in animal husbandry.

Credit: Emilio A. Laca

Land Use Optimization

At a high level, the goals of ranching and farming are the same as any business: increase yields and lower costs. Production maximization has long played a role in large operations. A twist to the optimization problem is land use optimization and how that can affect yields. According to NASA, “Australia’s rangelands provide an opportunity to sustainably produce meat without contributing to deforestation” if properly managed. This sort of optimization is made possible by big data coming from satellites. The same article cites how some West African nations use satellite data “to identify areas with agricultural potential and to estimate the amount of food available.” Growing up in rural Colorado, the most advanced tech I saw at ranches were solar powered fences and artificial insemination. Clearly a lot has changed. From a supply chain perspective, these trends also demonstrate how just-in-time manufacturing can be extended to resource allocation.

From a technical perspective, crop and livestock rotation will become outputs of a multi-objective optimization problem. I imagine that the challenge will be less about the optimization and more about the inelasticity of “bioprocesses”. Aside from slaughter or transfer to somewhere else, there aren’t too many options for reducing “inventory”. Presumably these issues already exist, so any solution is bound to be an improvement. Ultimately, there is a race to avoid the outcome that the U.N. foresees: the majority of humans eating insects as a primary source of protein. Even if that future is unavoidable (not necessarily bad), presumably similar techniques can be used to maximize insect yields.

Sensors and IoT

Technology advancements are driving parralel trends in agriculture and ranching. While satellite imagery offers a big picture overview, sensors provide a micro view of individual plants and animals. RFID tags are a first step enabling real-time tracing of an animal. Equally important is the assignment of a unique identifier to facilitate storing electronic records that can be merged into a centralized dataset. RFID is fundamentally passive, whereas sensors are active. This is where biosensors and Precision Livestock Farming (PLF) come into play. PLF is a comprehensive approach to livestock management and animal welfare. The goal is “continuous, fully automatic monitoring and improvement of animal health and welfare, product yields and environmental impacts” Some of the sensors developed to achieve this are surprisingly simple and surprisingly clever, such as sensors that monitor the vocalizations of livestock to determine stress, illness, etc. These advances can also “raise milk yields, while also increasing cows’ life expectancy and reducing their methane emissions by up to 30%” (CEMA). The Biosensors in Agriculture workshop held in the UK presents even more exciting examples.

Other notable research around PLF include image analysis to monitor animal welfare and
classifying the behavior of cattle and fowl based on GPS movements. According to one paper, a decision tree was used to classify four behaviors: ruminating, foraging, standing, and walking. The features were based on distances and turning angles from the GPS data. Not surprisingly, the confusion matrix was pretty poor in terms of distinguishing between ruminating, foraging, and standing. So there’s lots of opportunities to whip out R and randomForest or party to conduct your own analysis (assuming you have access to the data).

Data and Accessibility

Big data is often synonomous with cloud computing and for ranching it’s no different. As with agriculture there are trends to centralize data to “help ranch managers track livestock, view production statistics, plan grazing rotations and generate reports that can offer insight into the health of a livestock operation.” Unlike in agriculture, it doesn’t appear that the machinery manufacturers are taking a role, although it wouldn’t surprise me if some PLF suppliers have cloud platforms for their customers. GrowSafe Systems is creating their own cloud-based dataset based on their customer data. Their system collects and forecasts “complex animal traits such as efficiency, growth, health, stress and adaptation.”

Europe has taken a different approach focusing on defining a comprehensive classification scheme for agricultural systems. Clearly the goal is data interoperability, so data can be widely shared and applied across farms and ranches. This goal is reflected in the three-level system that encompasses environmental factors and GIS data to site-specific measurements of individual animals that affect yields and animal welfare. Landcover data appears to be the most extensive, while biosensing is likely where the most immediate opportunities are to be found.

As data becomes more focused on individual sites and animals, scarcity is the word that comes to mind. In the USA public datasets don’t come anywhere near the level of detail to make a useful analysis. See data.gov for an example of a disappointing dataset. Of course it isn’t clear whether transparency of this sort is even possible. One rancher believes they have a right to privacy and shouldn’t be compelled to open their books to external scrutiny. This is understandable, but does this belief extend to data? Data privacy is a thorny issue, particularly balancing privacy, ownership, and the need for transparency vis a vis food security/safety. Eventually I think economics will force a change of heart if yields and margins increase significantly with the help of open data. However, this may take the shape of data cartels as opposed to truly open data. As big data and centralized data stores become more wide spread, this debate over data ownership will continue to be visited.

Know of some public datasets available for ranching and animal husbandry? Post links in the comments!

This post first appeared on cartesianfaith.com. Brian Lee Yung Rowe is Founder and Chief Pez Head of Pez.AI // Zato Novo, a conversational AI platform for guided data analysis and Q&A. Learn more at Pez.AI.

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The power of big data, analytics and machine learning have created unique opportunities in the e-commerce industry. Thanks to data-driven enhancements to ads, upselling and cross-selling, online shoppers are able to get “what they want, when they want it.”

This transformation has had a direct and positive impact on business efficiency, driving more sales and improving customer satisfaction. But it has also had the adverse effect of widening the gap between online and brick-and- mortar businesses, and has faced the retail industry with higher shopper expectations and unprecedented challenges.

However, the advent and development of the Internet of Things (IoT) and the widespread use of mobile devices and mobile apps can help overcome these challenges. Thanks to microprocessors and ubiquitous internet connectivity, smart devices can be deployed everywhere and on everything, from point of sales systems to dressing rooms.

Thanks to microprocessors and ubiquitous internet connectivity, smart devices can be deployed everywhere and on everything, from point of sales systems to dressing rooms.

This enables retailers to gather and analyze data like never before, and to interact with each shopper in a unique and personalized way. Here’s how every aspect of a retail business can benefit from IoT technology and mobile apps, effectively improving sales, cutting costs and drawing customers back to the store.

Supply chain and inventory management

Inventory management problems account for some of the biggest expenditures and losses in retail stores. According to a report by McKinsey, inventory distortion, including overstock, stockouts, and shrinkage, cost retailers a yearly $1.1 trillion worldwide. In the U.S., shrinkage alone is hitting retailers with $42 billion in losses every year, 1.5 percent of total retail sales.

Thanks to IoT, retailers will be able to not only improve inventory control within the store but also expand it to the supply chain. Tracking of goods no longer starts at the store’s receiving dock – it begins at the point of manufacturing.

Better handling of the supply chain

With RFID tags placed on goods and environmental sensors in transportation vehicles, retailers will be able to trace the goods they purchase and their treatment and conditions throughout the supply chain. Information gathered from devices will be analyzed in the cloud and rule-based notifications and alerts can be sent to desktop and mobile apps in order to inform employees and staff members of events that must be acted upon.

The enhanced control will enable suppliers to reduce product damage throughout the journey to retail outlets. This will prove especially useful for the shipping of perishable and temperature sensitive inventory.

Retailers can also leverage IoT technologies such as RFID to track products through the extended supply chain, i.e. after the product has been sold. Having data and improved visibility will streamline otherwise-difficult tasks such as critical product recalls.

Improving in-store inventory tracking

One of the perennial problems retailers are faced with is the lack of accurate inventory tracking. Store shelves aren’t replenished on time; items are misplaced in shelves; sales associates aren’t able to locate items customers are looking for; order management is abysmal, leading to excessive purchase orders to avoid stock-outs. The results are higher inventory costs, lost worker productivity, mishandled stocking, potentially empty shelves and missed sales opportunities.

IoT technology can tackle these problems by bringing more visibility into the location of inventory items and offering more control. By deploying an inventory management system that is based on RFID chips, sensors and beacons, physical assets can be directly synced with database servers. Additional technologies such as store shelf sensors, digital price tags, smart displays and high-resolution cameras combined with image analysis capabilities can further help enhance the control of retailers on goods located at store shelves and in the back storage.

Subsequently retailers can better ensure inventory is adequately stocked, and when stock levels become low, reorder quantities can be suggested based on analytics made from POS data. According to the McKinsey report, reducing stock-outs and overstocks can help lower inventory costs by as much as 10 percent.

The use of IoT can also reduce missed sales opportunities attributed to poorly stocked shelves. When customers are unable to find what they’re looking for, they’ll take their business elsewhere. This can happen while the desired item is actually available in the backroom or displaced to some other shelf. Sales associates can quickly track items by their RFIDs using their mobile devices and beacons installed across the store. They can also receive timely alerts for misplaced items and emptied shelves in order to minimize customer mishaps. Improved on-shelf availability can improve sales by as much as 11 percent, the McKinsey report states.

Improved on-shelf availability can improve sales by as much as 11 percent

Reducing shrinkage and fraud

Shrinkage and fraud is an ever-present challenge in retail stores, whether from customers or employees. IoT can help curb the theft of items by adding a layer of visibility and traceability to inventory items. RFIDs, smart-shelves and camera feeds combined with sophisticated machine learning technology can paint a clearer picture of what takes place in-store, detect suspicious movement and determine whether items have been obtained through legal means.

Also, knowing that items are being tracked will discourage patrons and employees from resorting to the pilfering of goods. This is a huge improvement from traditional systems which rely on human monitoring, point-of- sale data and receipts to validate the sale of goods.

Customer experience

One of the benefits of online shopping is being able to push products and offers to customers instead of waiting for them to find them on their own. This helps to catch the attention of customers at the right moment and improve sales dramatically.

IoT will help enhance the brick-and- mortar experience to this level by helping gather data, perform analysis and make the best decisions for retail stores.

Optimizing product placement

Trying to figure out how customers navigate store isles is valuable information. Retailers always try to lay out their stores in order to maximize exposure to customers and improve sales. In the pre-IoT days, this has been done through human observation, educated guesses, random experimentation and manual sales correlation.

But now, thanks to data gathered from RFID chips, IoT motion detection sensors, beacons and video analytics, retailers can gather precise data from customer movement patterns and identify premium traffic areas. IoT makes is possible to learn how customers interact with specific items and discover which items are abandoned. Changes to store layouts can be automatically correlated to customer behavior changes and sales figures in order to perform precise A/B testing on tweaks and modifications.

Optimized use of in-store staff

Being able to identify customers that need help, and tending to their needs in time is an important factor in closing sales and improving conversion rates. But in-store staff can only watch so many customers at once, and in many cases the presence of a salesperson can be misinterpreted and considered offensive by customers.

IoT helps deal with this problem without disrupting the customer experience. Motion detection sensors, cameras and facial expression recognition algorithms can help identify customer who have been standing too long in one location and are manifesting confusion and ambivalence. The IoT ecosystem can then notify a nearby sales associate through a mobile or smart watch app. This way, shoppers get a better experience because they aren’t kept waiting, and retailers optimize their in-store staff.

Personalized offers and promotions

Banner ads and product suggestions that are customized based on browsing and purchasing history are one of the features that give online shopping channels the edge over brick-and- mortar retail. Cross-selling and upselling have become an important source of revenue for online sellers.

IoT can help retailers collect data and make offers to customers that will put them on par with their online counterparts. RFID chips, sensors and beacons can gather data about customer interactions with store items. The data can be analyzed by machine learning solutions and used to push extra information, customer reviews, recommendations and special offers on smart displays that are installed in stores.

Mobile apps can help move the experience to the next level. While customers interact with in-store items, the IoT ecosystem can merge the collected insights with their online product browsing history in order to provide useful information, offer loyalty programs and offer smarter suggestions for upsells.

Mobile apps in retail

IoT devices and sensors help collect data and glean insights from virtually every physical object and event that takes place in retail stores. But it is with mobile apps that IoT becomes a hands-on experience, especially in retail where most of the tasks are performed in field rather than behind a desk.

it is with mobile apps that IoT becomes a hands-on experience, especially in retail where most of the tasks are performed in field rather than behind a desk.

With a fully featured mobile app (or a suite of app for mobile devices and wearables) retailers can make sure that everyone within the retail chain has access to the data they need anytime, anywhere, in order to become more efficient at their jobs. This includes salespersons, inventory managers, suppliers and everyone else.

Mobile apps will also improve the customer experience as it will drive loyalty and enable customers to engage in a more personalized experience with retail stores and the smart gadgets that are installed in them.

Conclusion

With actionable insights offered by IoT-powered solutions, retailers will be able to offer customers what they actually want through a digital, connected and personalized experience. The gamut of data-driven and cloud-powered technology that is available for the retail sector to take advantage of can help merge the benefits of online and brick-and- mortar shopping experience. Eventually IoT will become the de facto standard and reinvent retail as we know it today.

Read about how Mokriya develops solutions for IoT problems

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By Abjijeet Banode. This article originally appeared here.

Fleet Management System (FMS) is one of the essential parts of businesses which directly or indirectly deal with automobiles. Precise fleet management minimizes various operational risks and increases cost efficiency. With proper utilization of analytics, alerts, and diagnostics, fleet management converts businesses to be more reliable and sustainable. Like any other business, predicting risks and working towards mitigation is essential for fleet businesses. Ample use of data analytics for early detection of faults and predictive mechanism helps business to reduce maintenance cost and downtime.

Typical modular fleet management unit consist of OBD-II (On-Board Diagnostics – Standard revision – II) module which connects to Controller Area Network (CAN) bus. Microcontroller, sensors, and various devices from vehicles use this bus (communication channel) to communicate with each other. OBD-II module captures diagnostic information from the CAN bus example, data engine control unit, and transmission. 

Figure 1: Typical architecture of Fleet Management System (FMS)

GNSS (Global Navigation Satellite System) receiver unit like GPS, GLONASS, assist to capture geographic coordinates. Synchronous capture of GNSS data and diagnostic data can help to immediately identify exact location of a vehicle breakdown or other events. Mapping it against reference data from the department of transportation can be utilized to analyse driver behaviour and their adherence to traffic regulations.

Every business has its unique requirement and objective behind Fleet Management System.  Organizations need to upgrade FMS module based their particular use case.  Trailer transporting food needs additional sensors to monitor temperature of on-vehicle refrigerators whereas a trailer carrying hazardous liquids has its own sensor requirements.

Cellular module is essential for real-time monitoring of a vehicle’s essential parameters, theft detection, driver safety, and to report breakdown. This data needs to be sent to cloud (or physical storage) so that fleet operators can analyse required parameters in real-time, perform predictive analysis, and identify mitigation requirements for smooth operation of fleet.

Effective use of data analytics and visualization tools – dashboards is the brain of intelligent fleet management system. Visualization parameters varies with respect to business needs but a few basic conclusions like driver behaviour, fuel efficiency, fleet health, maintenance requirements and breakdown will be always there on dashboards. 

Figure 2: Benefits of effective fleet management

The cost of E2E fleet management system has been reduced due to efficient analytics platform based on quality open source solutions (e.g. MongoDB, Hadoop), reduction in cost of electronic assemblies (chipset cost, antenna cost), economical cellular data connectivity (eUICC, dedicated data plans for M2M, IoT), reduction and flexibility in cloud storage cost due to competition, and most importantly cross domain interest of companies from various vertical (e.g. Cellular operators), electronic product manufacturers, and IT services are exploring additional revenue streams in automotive domain.

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5G Internet of Things

By Anand R. Prasad. This article originally appeared here.

This is first part of the article based on several talks I have given on 5G security since last year. In this part I present my views about 5G. On purpose I have avoided discussion on various activities regarding 5G around the globe (3GPP, ITU etc.). 

5G is expected to bring several changes in mobile communications system but watch that these changes are not something that will happen couple of years down the road instead they are already happening. First flavor of 5G is expected to be available in 2018 with the complete solution available in the market by 2020. With digitization on its way to touch every part of life, Internet of Things (IOT) will be integral part of 5G from the very beginning; this is unlike 4G where IOT came later.

In the following we will go through some of the key changes 5G is expected to bring. In the next article I will discuss security aspects.

(Core) Network

As we move ahead, virtualization technology (network function virtualization or NFV) and software defined network (SDN) for mobile core networks will become mature and actually bring down the cost while achieving the quality requirement. This will lead to the network (core network) being increasingly built of off-the-shelf hardware and open source software, virtualization will become common and cloud based mobile network will become available. It is expected that the network should accommodate multiple radio technologies. 

Changes mentioned above (virtualization and cloud) will allow networks to be launched for a specific service, a concept now being termed as network slicing or just slicing - this is what I call as vertical network that fulfill specific requirements in contrast to horizontal networks today that cater for all services. Virtualization and cloud also means that the network will become more open and accessible that will lead to network border going deeper in the network, i.e. instead of network elements as end-point a software module in the server farm will be the end-point and this end-point can migrate to different locations.

Radio Access Technology

Radio access technology will see several improvements with data-rates available from few bits going up to several gigabits, delays going down to micro- if not nano-seconds (compare it with millisecond range in today’s system). Radio access network will also become partially virtualized and cloud based.

Spectrum

Spectrum used for 5G will be different, there have been discussions of higher GHz bands, and thus the radio characteristics will be very different as well. The spectrum will have implications on coverage and behavior of radio access technology.

With the arrival of 5G, we should also expect wider usage of cognitive radio in mobile networks and aggregation with unlicensed band as well as usage of unlicensed band technologies.

Security Credentials

Given the variety of scenarios and technologies expected to come in use for 5G, it is worth questioning whether the security credentials should stay the same as today and whether there will be change in technology for storage of credentials. Change in security credentials could have implications on authentication and other security mechanisms.

Storage of security credentials can be seen from both network and device side. From the network side the storage is in terms of location, whether the security credentials are stored at the mobile network domain or at partner domain. Implication is the change in authentication end-point and transfer of session related security credentials to appropriate network functions after completion of authentication.

With regard to security credential storage in devices one can consider three different forms of storage (1) secure hardware environment as we have today in the form of UICC that is commonly known as SIM card, (2) embedded secure hardware environment, e.g. a UICC or similar device is implemented in a modem, this brings us to something like embedded SIM and (3) some form of software.

End Devices

End devices will see huge transformation together with technology enhancements that we are seeing around us. Already with the arrival of 4G we have seen increased usage of smartphone and over the top (OTT) services. As we move towards 5G we will see increased number of smart “devices” as well as a whole variety of IOT devices associated to a plethora of services, there will be wearables in common use and also virtual or augmented reality (VR or AR) type devices commonly available. Open source devices are available since a while now; we should expect increased usage of such devices as we move towards 5G.

With 5G we should expect mobile devices (all types like smart devices, IOT, VR, AR) to be reachable over Internet Protocol (IP) addresses, i.e. they will be directly connected to the Internet. On the other end of the spectrum there will be devices requiring long battery life (say 10 years) that are expected to work at very low data rates. 

Services

Services for VR, AR, IOT, smart devices and many more will appear as 5G will provision a platform that can fulfill variety of requirements. These services will be provisioned by the mobile operator or by a third party with or without business relation with the mobile operator.

Over the top (OTT) services are already there that have the potential of leading to potential cyber-attacks through malware, phishing etc. Sponsored data should be a source of revenue for mobile operators but misuse here leads to operator making financial loss.

Business

We are already seeing change in business model of mobile operators. One such change is in the form of APIs being made available for third parties to launch services over the mobile network. 

With 5G in picture we will also see operators getting in partnership with other companies to provision the services. This would mean that the partners would own the subscribers while the operator would be responsible for correct usage of the licensed spectrum.

User Space

5G will have much deeper penetration in the society than any of the technologies to-date. This equates to technology being used by savvy users like millennials and also Information and Communication Technology (ICT) illiterates who will leap-frog directly to the new technology. Thus the technology will go to the deepest part of life; not just human beings but animals (e.g. for vital information) and plants (e.g. for watering) will also get connected with IOT.

Photo Credit sayasatria

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IoT Central Digest, August 15, 2016

Articles on wireless standards, finance, and medical devices are just some of the stories highlighted in this issue IoT Central Digest. If you're interested in being featured, we always welcome your contributions on all things IoT Infrastructure, IoT Application Development, IoT Data and IoT Security, and more. All members can post on IoT Central. Consider contributing today. Our guidelines are here.

How IoT Will Transform The Automotive Industry

Posted by Luke Ryan

Here’s a glimpse of how IoT connectivity, smart sensors and gadgets, edge computing, mobile apps and cloud services will revolutionize how you interact with and use your car.

Behold the great possibilities of the Internet of Medical Things (IoMT)

By Rick Blaisdell

Unlike other industries, healthcare has been relatively conservative and slow in embracing innovations like cloud computing and the IoT, but that is starting to change, especially if we think about the past years. Innovative tech products and services are more and more part of our daily lives, making it harder for healthcare providers to ignore the potential advantages of connected medical devices.

Realizing the Elusive Value promised by the Internet of Things – An Economic Perspective

By Anirban Kundu

Much has been said about the value at stake and new growth opportunities presented by the Internet of Things trend. A Cisco estimates puts this at $ 14.4 Trillion opportunity where as a new McKinsey survey values this around $ 6.2 Trillion by 2025. One thing which comes undisputed from various reports across analyst’s community is the significant addition to the global GDP, trade volumes and new opportunities which would be created across sectors and industries.  Most reports in unison claim the benefits of the Internet of Things and the far reaching consequences this would have for the city we live in, the buildings we work and live in to the vehicles we drive. Every aspect of our experience with the physical world would be re-imagined from the way we work, our shopping experience, our medical services to the purchase of the insurance and banking services.

Global IoT Market Grows Again Says Machina Research

Posted by David Oro

UK-based Machina Research is adding to the mix of predictions for IOT with a new Global IoT Market research report. Their headline today: Global Internet of Things market to grow to 27 billion devices, generating USD3 trillion revenue in 2025.

Does IoT Need Wireless?

By Wade Sarver

Hell yeah! Don’t get me wrong, you could use CAT 5 to connect most of this stuff, but the idea is to have the equipment everywhere and talking all the time, or at least when we need to. They need to be wireless controlled for it to work properly and to be autonomous. What fun would a drone be if you needed to have a copper line connected to it. The FCC laid out their plan to sunset copper lines. I did a lot of work on them but I won’t miss them because wireless is so cool! If you like copper so much, then put that smartphone down and use a landline, if you can find one.

Thoughts on IoT and Finance

By Javier Saade

IoT, smart devices, wearables, mobile technology and nanotech - yes, nanotech - are forcing financial services incumbents and challengers to rethink every aspect of their value chains.  Those value chains are getting to be exponentially more distributed and automated.   Increased digitization means more data being generated, from all kinds of places at an accelerating rate.   IoT, regardless of your perspective, promises to enable the development of new value-added services to improve and automate user engagement, customer acquisition and service delivery - everywhere at all times.  

Data Analysis for Running the Business the Intelligent Way

Posted by Marcus Jensen 

Our very own selves from so little as a decade ago could not even comprehend the amount of information we are exposed to on a daily basis. Everything from planners to weather information is nowadays absorbed through technology. The amount of data that circulates our daily lives can turn out overwhelming; however, if used intelligently, it can bring upon a world of help when running a business.

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The advent of smartphones, and the rise of mobile internet and mobile apps disrupted and transformed the way we live and do business. Thanks to the millions of mobile apps you can buy or download from app stores, you practically have your mailbox, office, photo album, TV, game console, shopping cart and much more at your disposal any time you like.

Now, thanks to the Internet of Things, the phenomenon that is already triggering the next digital revolution, your car will become integrated with your increasingly-connected life and will be added to the collection of things that fit in that little gadget you carry in your pocket all the time. Already, the combination of IoT gadgets and mobile apps in vehicles is gaining popularity among consumers and fleet operators, providing functionality and opportunities that were inconceivable a few years ago, which make them more efficient, safer to drive, more resistant to crime and theft, and less costly to maintain.

The current possibilities are virtually endless, and the future is even more exciting. Here’s a glimpse of how IoT connectivity, smart sensors and gadgets, edge computing, mobile apps and cloud services will revolutionize how you interact with and use your car.

IoT provides improved access and security

With every part of your vehicle being connected to the internet, you’ll have better remote access and control over your vehicle’s functionality with your phone. Ignition, windows, lights, trunk, everything can be manipulated through your smartphone while you’re busy elsewhere.

So you can start the engine with a tap on the phone and let it warm up in winter while you’re having breakfast and going over news headlines.

BMW puts this functionality to display with its My BMW Remote App, which enables car owners to remotely unlock or lock their cars, sound the horn, flash the lights, and turn on the auxiliary heating/ventilation system.

Viper SmartStart is an example of how you can integrate IoT with legacy technology. The kit, comprised of IoT gadgets, a mobile app, and a mobile app will give you enhanced control on your vehicle. After installing the IoT devices in your car, you can use the SmartStart app to start, lock, unlock and locate your car with a swipe and tap on your phone.

But mobile access surpasses convenience and also enters the realm of security.

Today’s mobile devices protect your data with state-of-the-art security and encryption features that are hard to hack even for government agencies. IoT will help you leverage this enhanced level of security in your car and improve theft prevention.

NFC door locks can relieve you of the nightmares linked to your car keys being lost or stolen. After registering the lock with your phone through its associated mobile app, you can unlock your car by tapping your phone against the handle. You can rest assured that only a person possessing your phone and being able to unlock it can unlock the door to your car. And in case you want to lend your car to a friend or family member, all you have to do is to grant access to their phone through your mobile app.

TapKey has implemented this concept successfully, creating a mobile app that turns the smartphone to a car key and enables car owners to securely and easily grant vehicle access to others.

And in case you lose your phone, having the lock registered with another phone will be a matter of logging into a cloud app and introducing your new phone.

Smart car alarms will quickly send an alert to your smartphone in case your car is being broken into, and in case your car does get stolen, your mobile app will help you find and track it through its GPS device. This can help report the theft and have it recovered much faster.

IoT provides improved control over vehicle status and driving

On-board Diagnostic (OBD). Telematics devices are smart cloud-connected IoT boxes installed on vehicles which provide insights and real-time information about vehicle health and driver habits. These devices function by communicating with a set of smart sensors installed on different vehicle parts including doors, windows, engine and tires, and constantly monitor and report the status of the vehicle.

A mobile app interacting with the telematics system can act as a digital assistant which alerts drivers in real-time about measurable events such as speeding, sharp cornering, seatbelt usage and over-acceleration. The app can also communicate with the cloud service where historical driving data is stored in order to enlighten drivers about bad habits they should correct, and their driving improvements over time.

EcoDrive is an interesting app that monitors your driving habits in real-time, including acceleration, deceleration, changing gears and speed variation, and gives you a score (or eco:Index) which helps you assess your safe driving skills.

More advanced use of IoT and telematics would be to keep tabs on and alert about maintenance issues that can compromise passenger safety, such as low tire pressure, malfunctioning engine, parts that need replacements and overdue services. Drivers would be able to get a complete report of their vehicles with a tap and swipe on their phone and without the need to look under the hood.

Chrysler’s UConnect app is an example of the efficient use of telematics and mobile technology. The app lets you remotely monitor and control your car’s maintenance, provides you with monthly health reports and alerts you about critical maintenance issues that need immediate attention.

The best part about telematics and on-board diagnostics is that they’re standardized across the industry and do not require vendor-specific integration, which means your mobile app and historical driving data can be migrated and ported when you switch vehicles.

IoT sensors improve vehicle safety

While the intersection of IoT and vehicles provides many opportunities, perhaps safety is the most prevalent. If there’s one thing that IoT should be praised for, it’s the fact that it’s promoting safe driving and assisting drivers in avoiding road incidents.

With more and more cities investing in smart infrastructures, IoT-powered vehicles are much better prepared to help drivers in commuting safely. Interacting with IoT sensors installed on roads, connected vehicles can detect when drivers are veering off the road as the result of distraction or fatigue, and alert them to steer back on the road. In the case of semi- and fully-autonomous vehicles, the car itself can take matters into its hands and correct the vehicle’s direction if the driver doesn’t react.

Smart sensors and smart cement can also gather information about road surface and bridge conditions. Connecting to cloud servers, mobile apps get real-time insights about road conditions and assist drivers in choosing safer roads and avoiding hazardous areas before heading out. In case a driver treks into a particularly dangerous zone, e.g. an ice-covered road, connected vehicles will directly communicate with local gateways and sensors, retrieve data about road conditions, and warn drivers about the dangers and instruct them to slow down.

In 2007, the collapse of the I-35W Mississippi Bridge in Minneapolis resulted in 13 casualties and hundreds of millions of dollars’ worth of damage. Today’s IoT technology could’ve detected the bridge’s failing structure and warned both maintenance authorities and drivers about the dangers, saving lives and preventing damage.

IoT helps avoid traffic and congestion

Few things are as frustrating as getting stuck in a traffic jam when you’re late for work or want to attend an important event. Being able to avoid congestion and plan in advance can save you time and also reduce fuel consumption.

Fortunately, IoT can help in this sector as well. IoT sensors in roadways track and report commuting in real-time, which can help drivers better plan their trip and avoid crowded areas while also assisting city authorities in distributing congestion and pushing traffic toward the less frequented areas.

Mobile apps gleaning information from traffic sensors can estimate time of arrival based on the level of traffic and also provide alternative routes to drivers which will cut down the time and stress of the trip.

The added benefit of controlling traffic through IoT technology will help reduce car accidents considerably, and will collectively reduce pollution and help us have greener cities.
IBM has a great post on how it’s using apps and its IoT platform to collect traffic data, generate insights and control congestion.

Caveats and requirements

All the benefits of connected, IoT-equipped and mobile controlled vehicles isn’t without its drawbacks. The vehicle industry is already dealing with several worries where vehicle IoT is concerned, chief among them being security and privacy issues. There have already been several cases where connected cars have been hacked through mobile apps, infotainment systems and other insecure connected gadgets that are installed on the car.

While none of these dismisses the importance and impact that IoT will have over the future of cars, it does highlight the need to pay more attention to the security of IoT, especially in the vehicle industry.

This can be achieved by making sure the developed software is built by experts that have the knowhow to deliver both functionality and security. Secure coding should be one of the main tenets of any software that will be installed in our cars and their related peripherals, lest we want to see them be exploited by malicious actors and used against us.

The future of IoT in vehicles

For the moment, you have your car in your pocket. But this is just a taste of how IoT is transforming the automotive industry. Cars that can be parked with a single tap of an app button, circular economies where automobiles are shared and rented as a service through mobile apps, and the era of completely autonomous vehicles are not far away. Every day, the Internet of Things is conquering new summits. Who knows what tomorrow holds?

See how Mokriya develops solutions for IoT problems

(Photo courtesy of Faraday Future)

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By Rick Blaisdell. This article originally appeared here.

Unlike other industries, healthcare has been relatively conservative and slow in embracing innovations like cloud computing and the IoT, but that is starting to change, especially if we think about the past years. Innovative tech products and services are more and more part of our daily lives, making it harder for healthcare providers to ignore the potential advantages of connected medical devices.

Moreover, a new term is used more and more to describe this amazing connection between the Internet of Things and healthcare, and that is the Internet of Medical Things (IoMT). IoMT is the collection of medical devices and applications that connect to healthcare IT systems through online computer networks. Medical devices equipped with Wi-Fi allow the machine-to-machine communication, thus developing the basis of IoMT.

At the same time, healthcare companies are renewing their operative models through digital health technologies and are focusing more on prevention, personalization, consumer engagement and improved patient outcomes to remain competitive. Here are some great examples:

  • An asthma inhaler with a built-in GPS-sensor – Propeller Health has released an FDA-approved asthma inhaler with a GPS-sensor. Basically, a tracking device is placed into an asthma inhaler, providing support and helping reduce the cost for health systems and thus for patients. Every time the inhaler is used, time and location are being saved, the GPS-data recorded and imported into a personal profile. This allows for tracking of the time and location of the use of the inhaler, allowing a user to even avoid those areas which may prompt his/her asthma attacks.
  • New system for optimizing workflows in hospitals – In cooperation with Microsoft andHealthcast, The Henry Mayo Newhall hospital in Valencia, California implemented a smart system which provides the doctors with access to a wide range of data: from patient files to test results, prescriptions and much more. This was achieved by connecting 175 hospital devices, as well as the personal devices of the doctors, to the available computing offices and systems. Thanks to the new system, the doctors have secure access to examine laboratory tests, to write prescriptions, or to view the patient files at any time. As a result, the time for registration was reduced by 95% – from two minutes to six seconds.
  • Digital contact lenses for diabetics – The contact lenses were jointly developed by Google and the Swiss health care group Novartis, and will help diabetics to measure their levels of blood sugar through tear liquid and to transfer it to a glucose monitor or a smart device like a mobile phone.
  • Smart monitoring of medication – Vitality has been one of the pioneers in the medication area, developing a new system called GlowCap. Those drug containers use light and sounds to signal the patient when the time to take the medicine has come. They also remind the patient automatically through a call. Moreover, every week a report is being sent to customers, with information about how they should be taking their medication.

To drive adoption of IoMT systems and to achieve more end-to-end solutions, hospital administrators, vendors and manufacturers must cooperate to lead healthcare through this important change. The impact is clearly visible, as companies are developing a collaborative culture in embracing digital technology, and the next five to 10 years will be essential as they manage the data from patients and incorporate this into the physician’s workflow.

Photo source: freedigitalphotos.net

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Does IoT Need Wireless?

By Wade Sarver. This article originally appeared here

Hell yeah! Don’t get me wrong, you could use CAT 5 to connect most of this stuff, but the idea is to have the equipment everywhere and talking all the time, or at least when we need to. They need to be wireless controlled for it to work properly and to be autonomous. What fun would a drone be if you needed to have a copper line connected to it. The FCC laid out their plan to sunset copper lines. I did a lot of work on them but I won’t miss them because wireless is so cool! If you like copper so much, then put that smartphone down and use a landline, if you can find one.

So, back to IOT, (Internet of Things), they rely on wireless connections for more than convenience. This is how the machine to machine, M2M, really take off. Whether it’s to control valves for a water company or to read your electric meter or to control natural gas flow, you need to have connectivity everywhere. We just need to define what that connectivity will be. It could be the standard carrier networks, LTE really. That is going to be key for so much of this. But most of these systems will need much less bandwidth.

Small data networks, that sounds crazy, right? NOT! You see the new networks are built for larger packets, so they are so inefficient, and too expensive, for a simple command to open or close a valve. LTE and Wi-Fi seem like overkill for these applications, although they are everywhere and the most convenient to work with, especially Wi-Fi, it’s in your house and would be a great way for your smart home full of IOT devices to talk to your smartphone and the real world.

That is why the LTE format may not be the best for IOT, although it would be everywhere so by default it may be the technology of choice.

So how will wireless IOT work?

They need something for outdoor communication like LoRa, the low-bandwidth system. There is a LoRa Alliance, if you want to read more about what they are up to. Another good article on LoRa is here where they go into detail about how it works. What they explain is that they are planning to use the spectrum that is left behind, with smaller bandwidth. They way the Semtech chip works is that they utilize spectrum that is sub giga-hertz, like 109MHz, 433MHz, 866MHz, and 915MHz where they have smaller amounts of spectrum. They need to stay away from the license free spectrum because it might interfere.

There is another format called SigFox for outdoor communication. Again, made for very small packets of data. I found information at here if you want more information but here is what I got out of it. They are using the 915MHz spectrum (ISM band license free), using 2 types of Phase Shift Keying, PSK. This supposedly will help get the data through the noise. I am not sure what the coverage would be for something like this but I would bet its very limited. This is a low power, wide area, (LPWA) network. A good article on SigFox is here if you want to learn how they plan to deploy. I am told that they already have several deployments in the USA, although I don’t know of any personally.

Now, for the smart home, inside a building, or the smart office, you could use Wi-Fi, ZigBee, Z-Wave, Bluetooth, or something proprietary. We all know Wi-Fi and Bluetooth, right? It’s on your smartphones and in your homes. What we don’t know if ZigBee and Z-Wave.

What is ZigBee for IOT? Well, according to the ZigBee Alliance it is a wireless language that is used to connect devices, which is such a generic explanation that I could use for any wireless protocol. Come on!

So I went into Wikipedia at https://en.wikipedia.org/wiki/ZigBee where they give a much better explanation. It is line of site, LOS, and very short-range. It works in the ISM band, just like Wi-Fi, (2.4GHz in most countries but also in 915MHz in USA and Australia, 784MHz in China, 868MHz in Europe). The data rate is very small, remember I said smaller packets are all you need? This is made for very small and efficient bursts of data. They also support mesh networking. Mesh means that the devices not only connect to the hub but they can repeat the signal to each other forming a mesh. This is a great way to extend coverage if you don’t need massive bandwidth.

What is Z-Wave for IOT? Z-Wave takes ZigBee and makes some enhancements. It specifically works in the 908.42GHz range in the USA and 868.42MHz band in Europe. For a great explanation go here but its made for very small networks in the home. Find more at http://www.z-wave.com/ but I haven’t heard much more on this except that they have a version that will work with the Apple iWatch.

As you can see there are many technologies to roll out the IOT format. I don’t really know if there is a clear winner but I think it depends on the need. The wireless backhaul will come down to a chip they add to the device based on need, coverage, and cost. I could see someone using all of the technologies in a device to get the coverage they need, like maybe utility meters. That would make sense because it would be a one-time up front cost. However, for the in home stuff, cheap is what they need. I seriously don’t see people putting in a new network in their homes if they don’t have to but many companies will say you need a “hub” which will be the special format switch that their devices will, in theory, talk to the Wi-Fi in their homes. I already see it but it looks like they want to sell more devices in the home. So maybe high-end stuff will need the hub. I could see the hub as another line of defense in security, where if someone hacks your Wi-Fi and/or cable router then they would need to get by another device to get to your thermostat or light switches.

However, for an outdoor network I could see a dedicated network taking off for several reasons, cost reliability, and security. It costs money to pay the carrier a fee every month when you have a small low data device on it when you could put one of the cheaper hotspots in a space to connect your devices. Again, it really comes down to cost and reliability. Many will say they want security, but how secure can they really be?

A few more articles that may interest you:

http://pages.silabs.com/rs/silabs/images/Wireless-Connectivity-for-IoT.pdf?mkt_tok=3RkMMJWWfF9wsRoguKjNZKXonjHpfsX86%2B4rWKK3lMI%2F0ER3fOvrPUfGjI4DSsJkI%2BSLDwEYGJlv6SgFTLPBMbNsz7gOXBg%3D

http://postscapes.com/internet-of-things-protocols/

https://en.wikipedia.org/wiki/LPWAN

http://www.semtech.com/wireless-rf/internet-of-things/

https://www.micrium.com/iot/devices/

http://www.networkcomputing.com/internet-things/10-leaders-internet-things-infrastructure/1612927605

https://www.thethingsnetwork.org/

So let me know what you think, email [email protected] when you think of something to say!

Photo Credit here.

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With the explosion of IoT in insurance, ensuring cyber security, providing automated services and improving overall customer engagement are integral for businesses to develop.

Blockchain could be the saving grace to unlocking all of these issues and to supporting insurers looking to adopt IoT and make their business plan make sense. So, where are insurers at in adopting this technology and what are the benefits?

To put a spotlight on the connection between blockchain and IoT for insurers, Insurance Nexus conducted exclusive interviews with Everledger, Guardtime and CGSC and created an exclusive white paper, you can access the document right here.

Read the white paper to gain a clearer perspective on how blockchain can help insurers set up IoT in their business, including how to:

  • Improve security and privacy: customer confidentiality and security concerns act as a barrier to insurers looking to employ IoT, get to grips with the way blockchain circumvent the challenges of security and privacy
  • Drive better customer engagement: for years, insurance has been regarded with little trust by customers, discover how IoT and blockchain opens the doors to innovative engagement tools in insurance
  • Implement automated services: lengthy policy approvals and claims authorizations act as a deterrent to customers and are operationally inefficient, learn how blockchain can support fast and efficient automated services

The white paper is complimentary and can be accessed right now

I hope that you enjoy the read and please let me know if you have any questions.

Kind Regards,

Marsha

Marsha Irving
Head of Innovation
Insurance Nexus
T: 1 800 814 3459 ext 4353
E: [email protected]com

Insurance Nexus is part of FC Business Intelligence Ltd. FC Business Intelligence Ltd is a registered company in England and Wales. Registered number 04388971, 7-9 Fashion Street, London, E1 6PX, UK

Insurance Nexus is the central hub for insurance executives. Through in-depth industry analysis, targeted research, niche events and quality content, we provide the industry with a platform to network, discuss, learn and shape the future of the insurance industry.

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By Anirban Kundu. This post originally appeared here

Much has been said about the value at stake and new growth opportunities presented by the Internet of Things trend. A Cisco estimates puts this at $ 14.4 Trillion opportunity where as a new McKinsey survey values this around $ 6.2 Trillion by 2025. One thing which comes undisputed from various reports across analyst’s community is the significant addition to the global GDP, trade volumes and new opportunities which would be created across sectors and industries.  Most reports in unison claim the benefits of the Internet of Things and the far reaching consequences this would have for the city we live in, the buildings we work and live in to the vehicles we drive. Every aspect of our experience with the physical world would be re-imagined from the way we work, our shopping experience, our medical services to the purchase of the insurance and banking services.

In midst of all these far reaching consequences lies the biggest dilemma for the early adopters of Internet of Things. The promised value seems to be bit more elusive and early adopters still have not found the golden bullet to unlock all the treasure trove as has been outlined in the research. While we are confident about the promises of 2020, the IOT early adopters working in 2016 seems to be in for a “cognitive dissonance”. The journey to the value realization is still more distant and needs some fundamental restructuring of the existing business processes and industry structure as it exists today.

In this blog I intend to take a detailed look at the value realization dilemma with concepts from Economics and Analytics and chart a detailed path to the all elusive value realization. This would lay the foundation of a “Business Value Calculator” for the IOT scenarios which can be adopted by various entities to realize the potential of IOT.  At the onset we need to reexamine the aggregate consumer demand in the context of Internet of Things.

The Promise of the Infinity:

 The “Consumer Demand” curve needs to be revisited in the context of Internet of Things to bring fore the “Promise of the Infinity”.  Today our industry structure and the cost of production imply a physical limit on the profitable supply of the aggregate quantity demanded and is limited by the equilibrium quantity arrived at by the intersection of the supply and demand curve. As can be seen in the Figure below there are 2 major opportunities which has not been part of the revenue for the company namely – consumer surplus and the area of the curve beyond the equilibrium quantity.

Interestingly enough the area beyond the equilibrium does not even have a mention in economics literature due to constraints of profitability. However, in the context of Internet of Things this region which till now has not been accounted in any financial calculations would be critically examined and holds the key for the promise of the infinity.

Fig 1: Consumer Demand Curve/Equilibrium Pricing

Business’s today are based on this demand supply structure where we have spent elaborate efforts to reach the highest possible quantity demanded and continuously worked towards decreasing the price and bringing more customers into the fold. However as with the physical networks this limit is still a finite limit and as such we never had to explore the “fat tail” of the consumer demand curve.  This however is changing with the new business models where products are being offered as services. This fundamental transition has now liberated the current constraints on the product pricing and opens up the “Promise of the Infinity”.  This coupled with the power of the network has now made it possible for the ecosystem to drastically bring down the prices of the products by converting them into usage based services.

With new pricing structure and the offering of the products as services we need to reexamine the demand curve being the equilibrium previously set due to physical constraints.  The new value is now added by the large number of quantity demanded in the calculation of the value captured by the enterprise. While we see the prices of the services driven down we more than compensate this decrease by an exponential increase in the quantity demanded at the price.  This open up 2 interesting analytical scenarios first being the “price elasticity” analysis of the consumers and the second being resource usage analysis. 

The Power of Exponential

We are now in the era of transition where we are set to see that more and more products would be offered as services and as such we are moving to a completely new paradigm of computing the quantity demanded.  In the earlier figure where the limits to quantity demanded were also bound by the limits of affordability. There is a finite limit to the number of the people who could afford to “buy” a Ferrari or the most expensive jets. On the supply side we also would have the limits on to the units produced profitably. This has a fundamental change in the price elasticity of the products v/s service.

As the product purchase is bound by the physical limits there is considerably higher price elasticity than the price elasticity of the “products as a service”. This is a fundamental change which changes the slope of the demand curve and makes it much flatter in case of products as services and hence increasing the quantity demanded exponentially. 

Earlier the revenue recognized by the company was at the time of the purchase and additional services paid by the users. In case of the product as services we would convert one time product cost into usage based pricing and this would imply that the number of transactions in case of the “products as a service” is exponentially higher than the number of products sold.  

In a resource sharing paradigm the quantity defined would be based on the number of times the service is utilized at a reduced price as compared to the outright purchase price. This coupled with the net new users of the services takes the number of transactions as an exponential of the previous constrained quantity supplied.

Fig 2: An exponential increase in the number of transactions resulting from the new business model of products being offered as services

This is the foundation to start the definition of the IOT Value calculator. The final revenue increase is produced by the interaction of the increased quantity demanded and the reduced price of product when offered as a service.  In the next blog we would illustrate a more analytical treatment of the difference in the price elasticity between the two models. Also the usage metrics analysis based on the customer preferences. As in evident in the revenue calculation we have 2 exponential effects against the substantial decrease of the product price. Considering the nature of the inelastic demand curve for the “product as a service” we have the quantity effects far outweigh the effects of the price decrease. A mathematical treatment is available on request.

The analysis therefore lays the foundation for unlocking the elusive value of the IOT. Here we define this from an economic perspective and a follow up paper would be published where a company can simulate the usage behavior, price elasticity and increased number of transactions.

Finally the appeal of Consumer Surplus and Perfect Price Discovery

This is the sweet spot where advanced analytics meets the Economics to present the additional opportunities of mass personalization. We have seen the value which is captured moving down the “fat tail” of the demand curve.  Advanced analytics through segmentation, clustering and perfect price discovery helps us to transform the consumer surplus into economic value. 

While the demand for the product as a service would gather momentum, we would still see the need of mass personalization being driven by the ability of the enterprises to transform their manufacturing facility to enable lot size 1 production.  Harley Davidson had cut the lead time in the development of the customized production to less than 6 hours. This leads the fragmentation of the existing business models fracturing along two paths- one path to capture the high value consumer surplus through value added personalized offering and on the other side we would exponentially increase the number of transactions being offered at a lower price made possible orienting the product offering as services.

With advanced techniques in customer segmentation and the availability of personalized data availability per user we now are able to offer personalized products to translate the consumer surplus to economic value. While the traditional pricing strategies related to segmentation to offer group, channel or regional pricing have been employed successfully in the past to capture more of the consumer surplus, there were still potential to capture additional value specific to individual users. “Mass personalization” would help to transform more of the consumer surplus into economic value.

Bring in the additional value of the consumer surplus and combining it with the value based on the products as a service companies would be able to significantly extract the elusive of the IOT and set us on the path to create an Internet of Things “Value Calculator”. 

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Technology. Big Data. Internet of Things. Cloud. The promises are so big, the possibilities so great, but it’s often so difficult to know if progress is really being made in ways that will benefit the world we live in. Here’s a look at some of the activities and initiatives worth reading in the agriculture technology category.

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UK-based Machina Research is adding to the mix of predictions for IOT with a new Global IoT Market research report.

Their headline today: Global Internet of Things market to grow to 27 billion devices, generating USD3 trillion revenue in 2025

Key findings include:

  • The total number of IoT connections will grow from 6 billion in 2015 to 27 billion in 2025, a CAGR of 16%.
  • Today 71% of all IoT connections are connected using a short range technology (e.g. WiFi, Zigbee, or in-building PLC), by 2025 that will have grown slightly to 72%. The big short-range applications, which cause it to be the dominant technology category, are Consumer Electronics, Building Security and Building Automation.
  • Cellular connections will grow from 334 million at the end of 2015 to 2.2 billion by 2025, of which the majority will be LTE. 45% of those cellular connections will be in the ‘Connected Car’ sector, including both factory-fit embedded connections and aftermarket devices.
  • 11% of connections in 2025 will use Low Power Wide Area (LPWA) connections such as Sigfox, LoRa and LTE-NB1.
  • China and the US will be neck-and-neck for dominance of the global market by 2025. China which will account for 21% of global IoT connections, ahead of the US on 20, with similar proportions for cellular connections. However, the US wins in terms of IoT revenue (22% vs 19%). Third largest market is Japan with 7% of all connections, 7% of cellular and 6% of global revenue.
  • The total IoT revenue opportunity will be USD3 trillion in 2025 (up from USD750 billion in 2015). Of this figure, USD1.3 trillion will be accounted for by revenue directly derived from end users in the form of devices, connectivity and application revenue. The remainder comes from upstream and downstream IoT-related sources such as application development, systems integration, hosting and data monetisation.
  • By 2025, IoT will generate over 2 zettabytes of data, mostly generated by consumer electronics devices. However it will account for less than 1% of cellular data traffic. Cellular traffic is particularly generated by digital billboards, in-vehicle connectivity and CCTV. 

In a prepared statement Machina Research CEO Matt Hatton commented: “Through our regular ongoing work in our IoT Forecasts Research Stream we are constantly monitoring hundreds of different constituent applications across every country and adjusting our outlook for each. Every year we take a snapshot of the IoT market, pulling our latest forecasts to examine how the overall market had developed in the year. This year the top line figures of 27 billion connections and USD3 trillion of revenue continue are eye-catching and the opportunity is substantial. However it's not just a case of rising tides lifting all boats. To take advantage of the opportunities in IoT, suppliers need to understand the key market dynamics and their competitive environment, and develop best practice. Most of what Machina Research does is focused on supporting various players understand and exploit the opportunities we outline in this study”.

Machina Research focuses on Internet of Things, M2M and Big Data markets. Their ‘IoT Global Forecast & Analysis 2015-2025’ provides an overview of the global IoT market from 2015 to 2025, featuring forecasts of connections, applications, technology, traffic and revenue. It is based on data extracted from Machina Research’s IoT Forecast Database in August 2016. The report is a summary snapshot of the detailed country-by-country and application-by-application forecasts contained within the IoT Forecast Database.

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