Cisco: Internet of Things Now a $19T Opportunity

  • Tweet  
  • LinkedIn  
  • Facebook  
  • Google plus  
  • Send to Kindle
  • Send to  

In his keynote address at the Consumer Electronics Show, Cisco CEO John Chambers says the Internet of Things could be a $19 trillion opportunity and the “most exciting” transition in the Internet thus far. The bigger question: Where exactly is this opportunity?

[caption id="attachment_34012" align="aligncenter" width="594"]Cisco CEO John Chambers delivers his keynote at the 2014 CES in Las Vegas. Cisco CEO John Chambers delivers his keynote at the 2014 CES in Las Vegas.[/caption]

Cisco continues to push the concept of the Internet of Things -- or, as it calls the trend, “The Internet of Everything” -- in which billions of IP-enabled devices are connected and interlinked via the Internet. Last year, Cisco said this was a $14.5 trillion opportunity. At the Consumer Electronics Show, CEO John Chambers bumped that estimate to $19 trillion and says it could boost Cisco profits by 21 percent by 2022.

Related articles

“This is not about technology at all,” Chambers said in his keynote address in Las Vegas. “It’s about how it changes peoples’ lives forever.”

Chambers and Cisco are right. The Internet of Things is huge. Interconnectivity of all-things digital and the conversion of analog systems to IP-enabled equipment has long been a dream of those who built the Internet. And the vision has been around much longer, as science-fiction writers have painted mosaics of a future in which people can walk up to any wall to access everything from information to food to entertainment.

The contemporary manifestation of the Internet of Things is smartwatches, Internet-connected televisions and portable devices, such as convertible PCs and tablets. At CES, electronics manufacturers are unveiling a number of new devices that leverage the computing and storage power of the Internet. The idea is to reduce the local client processing burden, and push consumers and businesses to service-based subscriptions.

Eventually, the Internet of Things will gradually expand to include everything with a digital heartbeat, including kitchen appliances, automobiles and autonomic municipal systems. Many of these systems are already in limited use. New York City, for instance, is piloting a program in which motorists can pay for metered parking with their smartphones and get notifications when their time is about to expire. Nest, the Internet-connected thermostat, enables homeowners to control their heat from virtually anywhere via their smartphones. And home security systems are already accessible and controllable over the Internet.

The problem for tech vendors, solution providers and, ultimately, customers: You can’t build or buy the Internet of Things. This $19 trillion opportunity – which is slightly greater than the combined gross domestic product of North America – that Chambers speaks of is an illusion; an oasis that’s always on next rise of the desert. Ask Cisco or any other tech vendor to show you the box that “the Internet of Things” comes in? They can’t. It will never happen.

There is no such thing as “the Internet of Things” as an opportunity. It’s a concept, a trend, an idea. It’s like cloud computing – an umbrella term that describes a future state. It’s not a technology nor a product nor, by consequence, a business model.

If you ask Chambers and others of his ilk to break down their revenue from the Internet of Things, they will be able to provide you numbers. Chambers will speak of core networking, unified communications and security sales, as they are contributing components to the infrastructure and systems that make up the Internet of Things.

Samsung would something similar – and talk about the sales of its phablets, smartwatches and, someday, home appliances. Microsoft would talk about the applications and middleware it sells. And IBM will talk about its “Smarter Planet” systems, in which it provides the applications and intelligence that connects all the hardware.

For solution providers, the Internet of Things is a rich opportunity, but not one that anyone will ever call a business model or identity. No solution provider will ever call themselves an “Internet of Things Provider.” Instead, they will continue to sell, support and manage the endpoint, networking, storage, security and applications that make up the IT fabric, just as they do today. The difference: There will be a more devices and applications, with greater diversity, than today.

No doubt that the Internet of Things will transform the IT landscape and marketplace. It’s a natural evolution as we attempt to automate, manage and optimize as many systems as possible. Just don’t try to package and sell the ultimate IoT appliance.

  • Tweet  
  • LinkedIn  
  • Facebook  
  • Google plus  
  • Send to Kindle
  • Send to  
More on Channel Business
money-wad-dollar

IDC predicts 21 percent increase in 2015 cloud infrastructure spending

Research firm expects U.S. to see fourth largest growth globally

Men shaking hands

Fewer deals, smarter sales

What appears illogical on the surface — lower sales volume, higher profitability — makes perfect sense when you think about it

seo-question

Lenovo: People don't know enough about our channel business

Vendor opens enterprise briefing center aimed at increasing customer engagement

Boxing glove

Fight IT commoditization with differentiation that matters - partner

Clients care more about money and efficiency than IT jargon, an MSP says

Visitor comments
Add comments
blog comments powered by Disqus
In-depth
The cost of doing business

MSP Consortium free RMM, PSA tools should ease MSP business costs

The Managed Service Provider Consortium is giving away a new remote monitoring and management and professional services organization tool to enable solution providers to operate free of costly licensing fees

mobile-iot

‘Things’ take center stage

Vendors, VARs, and start-ups feed off rapidly growing momentum of the IoT movement

Men shaking hands

Fewer deals, smarter sales

What appears illogical on the surface — lower sales volume, higher profitability — makes perfect sense when you think about it

marc-dupaquier-photoshop1

Vendor Q&A Series: Marc Dupaquier, IBM

The latest channel exec to sit in the Channelnomics hotseat is IBM's general manager of global business partners