The Internet of Things (IoT) is bubbling up behind almost “Everything” in recent years. The concept of connecting allsorts of objects, components and devices to a central network where Big Data can then be crunched to analyse and react to human behaviour, environmental conditions and an object’s status, has the potential to revolutionise the world we live in.But is this new technological construct a profit driven private sector enterprise, or a society driven public sector initiative?
A recent report by Gartner suggests that despite increasing pressure on authorities to use IoT technology to balance resource constraints with sustainability concerns, the private sector will account for the vast majority of IoT connections over the next 5 years.
In fact, many believe that public sector organisations are a step behind when it comes to adopting innovative technologies, but a new study from Cisco suggests that this belief is, in part, mistaken. “The public sector is an excellent proving ground for IoT because of the size of many government institutions, the number of people they serve, and the difficult problems they must solve. The 40 jurisdictions we studied rival the best private sector firms in the vision, scope, and execution of their IoT initiatives. And all organisations — public and private — would do well to emulate their examples” the report claims.
Indeed our own research into IoT and Big Data looks at the different building types where the Internet of Things should become prevalent. Opportunities for energy saving and improved performance of buildings through IoT can apply to all kinds of building types. In particular, interest is being shown by building managers of health care facilities, large commercial real estate, universities, schools, retail outlets, and hospitality.
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So what can we read into these varying opinions of public and private sector IoT adoption?
The virtual connection of data from people, processes, and things, the Internet of Things, or as Cisco perhaps wishfully calls it “the Internet of Everything” (IOE), promises a world of new economic opportunities. Their study has put a value on that opportunity, concluding that the public sector could see as much as $4.6 trillion in IoT-related savings and revenues worldwide over the next decade.
"IOE solutions have the potential to change everything", said Martin McPhee, Cisco's senior VP for consulting services. "Public sector leaders should act now to identify major IOE opportunities in their agencies, and begin by reimagining what is possible in an IOE world".
Cisco’s research is based on an economic analysis of 40 agency-specific and cross-industry uses of IoT. It looked at various ways that interconnected systems are expected to improve employee productivity, reduce operating costs, utilise public resources more efficiently, and create new revenue streams for municipal and regional governments. It also factors in potential benefits defence organisations around the globe might achieve through enhanced connectivity, using next-generation communications systems.
Of the overall $4.6 trillion, cities around the globe that harness so-called killer apps might potentially realise a total of $1.9 trillion through improved energy efficiency in buildings, utility tracking, and highway toll management. Cisco explained that the greatest municipal-level savings would come from smart buildings, with additional substantial savings to be realized from gas monitoring, smart parking, water management, and road pricing.
Gartner, meanwhile, claimed investment and service opportunities would ensure that the private sector, through smart homes and commercial buildings, would remain at the forefront of IoT deployments, rising to 81% of total connections in the next five years.
Gartner suggested smart home and commercial building technology will be the primary application of IoT, representing over 45% of connected things in use this year, and 81% by 2020. Smart cities will use 1.1 billion connected things this year, rising to 9.7 billion by 2020, the report claimed.
While Cisco and Gartner may disagree on which sector might lead IoT adoption, and perhaps what constitutes private and public, both reports make very clear that smart building is absolutely central to the IoT movement in the coming decade, and that IoT will significantly change the world we live in.
As such, our recent reports on The Internet of Things in Smart Buildings and Big Data for Smart Buildings go one step further. Specifically analysing what is widely accepted as the leading market segment for IoT, or Building Internet of Things (BIoT) as it has become known.
We assessed the additional cost requirement of adding connectivity through sensors to existing or newly installed building systems, as well as projecting the growth in related network hardware and IoT data services that the BIoT would enable to generate. Projecting that the global market for BIoT would rise from $22.93Bn in 2014 to over $85Bn in 2020.
Our Big Data report estimates that the market for Big Data and Cloud Based Software and Services in Smart Buildings, alone, will grow from $5.2Bn in 2014, at a rate of 33.2% CAGR to nearly $30Bn by 2020.
Be it public or private, or both, experts around the world agree that Smart Buildings will lead IoT development, IoT represents a huge business case for both sectors and that IoT will revolutionise our society through the built environment.