Investment Sector: Internet of Things (IoT)
Overview
The Internet of Things (IoT), sometimes referred to as the Internet of
Everything (IoE), is a broad term used to describe the expansion of the Internet
into a broad network of interconnected "things" embedded with electronics,
software, sensors, and connectivity. These things can include devices, apps,
software, people, virtual machines and more. IoT enables these things to be
sensed and controlled remotely, resulting in more direct integration between
the physical world and computer-based systems. Clearly identified as the next
'megatrend' in Internet growth and related investing, experts agree that the
Internet of Things will extend the reach of the current Internet by at least an order
of magnitude (i.e. 10x larger than today) in the next several years.
Market
Market experts, including Cisco, Gartner, and Ericsson, all forecast that
IoT enabled touch-points will reach 50 billion units by 2020, which is several
times larger than the collective mobile and PC Internet today. Just as the
mobile devices dramatically expanded the reach of the previous PC-connected
Internet, IoT will again dramatically expand the current Internet and enable a new
generation of machine-to-machine communication. This megatrend will impact
all aspects of technology and create entirely new fields as well. We are just on
the cusp of this wave as we see the first generation of connected thermostats,
surveillance cameras, wearables, and connected healthcare devices come to
market.
By all accounts, IoT is a multi-trillion-dollar market. Increases in operational
efficiency alone will reach into the hundreds of billions. For example, a recent
GE IoT study found that a modest 1% increase in operational efficiency in energy,
transportation, logistics and healthcare could yield $276 billion in operational
savings by 2030. Moreover, McKinsey, Cisco and HP all estimate the total
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Taiwan Economic Forum
Volume 15, Number 4
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