Verizon Weighs in on the Internet of Things 2015

The author, @GlenGilmore, is a social media strategist and educator at the Rutgers School of Business where he teaches executive courses in Digital and Social Media Marketing.  An attorney at law, Gilmore is the author of Social Media Law for Business.  Earlier this year he was named by Inc. to its list of Top 30 Internet of Things Experts.

Dear Reader, please note I have the privilege of serving as a Verizon brand ambassador, which is a sponsored relationship.  Rest assured, though, that the words and thoughts in this post are entirely my own and may not necessarily reflect those of Verizon. 

“If you don’t have an IoT strategy, you should.”  So begins a 2015 report by Verizon on “The Internet of Things” (IoT).  It is sound advice. 

In 2014, Verizon “saw a 45% year-over-year revenue growth” in its IoT business.  Its IoT report, which speaks to public and private sector applications of the technology, adds nicely to the understanding of an extremely important topic. 

The 23-page report,  gated by a sign up, outlines what enterprises are currently doing in the IoT space and provides recommendations on what organizations should be doing to “get the most out of it.”  If offers examples of the advantages of the technology.

The report looks at the IoT application in four sectors:  (1) Energy and Utilities, (2) Manufacturing, (3) Public Sector, and (4) Transportation.

“The Internet of Things?”  It is the world in which we live today.  Things of all sorts have become “connected things,” things connected to the Internet via the smallest sensors.  It is what gives us the prospect of driverless cars, home thermostats that learn our temperature preferences; smart watches that track how much we’ve slept and how far we’ve run.  Get the picture?  As the report notes, it will “revolutionize how we live and work,” with more than a billion connected devices in use today.

Clearing away some of the confusion surrounding the topic, the report observes, “the key ingredients — network connectivity, cloud, security, and infrastructure — have existed for decades.”

What makes IoT so exciting from a business perspective?  Verizon notes that its customers are seeing benefits in three key categories:

  1. Improved customer and citizen experiences;
  2. Accelerating growth and business performance; and
  3. Improving safety and reducing risk.

Why is the IoT accelerating so quickly?  Verizon observes that, “declining cost of sensors, connectivity, and data processing power is making the ROI equations for IoT projects look even more appealing.”  In other words, it’s worth the investment.

IoT adoption isn’t as pervasive as many report.  Interestingly, Verizon study found that the actual number of enterprises that have “adopted IoT extensively” is just at 10%, far less than other reports that suggest a far higher number.

It’s all about the data – actionable data.  People get real excited about data.  Connected “things” generate a ton of data and share that data.  Verizon cautions that the key point is that this data must be “actionable,” it must be “integrated into business processes.”  The secret sauce is “near real-time business intelligence.”

One of the biggest challenges of IoT is figuring out how best to use it.  Verizon notes that to meet this challenges, even “banks and supermarkets are running public innovation events to generate new ideas for using IoT sensors and data.

Yes, IoT will give us billboard advertising out of the “The Minority Report”

Raising privacy concerns, connected devices do tend to track us:  where we’ve been and where we are, allowing some to predict where we’re likely to go next.  Along the way, sensors will ensure that we get advertising that caters to our “likes”, giving new meaning to “ads that stalk.”

If you want to keep us with the Joneses, your home will need to get smarter.  IoT is bringing smarter devices to our homes.  Verizon reports that its network data showed “an 89% year-over-year increase in the number of connections for smart alarms, cameras, and other home security solutions.”

IoT will make everything much more personal.  For business, IoT will take much of the guesswork out of risk assessment.  For example, the automotive insurance industry could replace existing methods of premium assignment that rely on broad categories of gender, age and geography, with a driver’s actual driving habits, introducing “usage-based” insurance.  This could reward safe drivers and place higher premiums on those whose habits demonstrate a higher risk.

Will consumers buy into “connected” cars?  According to the Verizon report, “25% of car buyers said that connectivity made a vehicle much more desirable at the time of purchase.”

Turning data into insights could help existing businesses beat disruption.  There is a broad-based fear of “Uberization” – a fear that a digital startup will disrupt a well-established business or industry by creating a more seamless and efficient user experience and service.  Verizon counters that, “The ability to gather data and turn it into insight is an important factor in building and sustaining competitive advantage. IoT can help.”

IoT will be huge for loss prevention.  In many ways IoT will improve worker safety and lessen business losses.  "IoT-enabled systems can predict and help prevent accidents,” the report notes. For product inventory, remote awareness of threats will reduce losses by activating cameras or triggering countermeasures.

Predictive Analysis and Preemptive Action.  Talking about the variety of IoT solutions that exist, Verizon does a nice job honing in on some of the key advantages of IoT.  So much of the magic of IoT is the use of real-time data collection and data analysis for predictive analysis and preemptive action.  In one scenario, this could be the anticipation of an accident and avoidance measures; in another, it could be the anticipation of a consumer action and the announcement of a coupon to capitalize on the scenario.  As Verizon notes, IoT success is about “agility,” the ability to “predict and adapt.”

Wearables in the workplace will improve worker wellness and safety.  Everyone has an interest in healthcare costs.  Wearable technologies provide opportunities for employer and employee collaboration in improving wellness, lessening healthcare costs, and protecting workers in the workplace. 

Energy and Utilities: 

Smarter Meters; More Reliable Infrastructure

In the Energy and Utilities sectors, “sensor data and advanced analytics can be used to predict the failure of critical components,” “avoiding costly breakdowns. And detailed information on local weather conditions.”  Smarter meters also give the industry far greater efficiencies, with more sophisticated automation.


Remote Monitoring an Added Win

In Manufacturing, beyond real-time stock management and enhancements to workforce safety and efficiencies, manufacturers can tap into IoT to “remotely monitor the condition of equipment,” reducing costs, lessening customer disruption and improving customer satisfaction.

Public Sector: 

Efficiency and Safety

In the public sector, IoT-enabled devices are being used to cut down on energy costs based on actual public usage, smart parking sensors are enhancing down-town visits by reducing drive time and congestion related to finding parking spaces, digital signage is seizing on the aggregation of near real-time traffic information to guide safer and more efficient traffic flow.

Network sensors are both collecting data relating to an array of public services, from monitoring air and water quality, infrastructure stability, early alert of public hazards, and automating responses to address tasks in a more efficient, certain and timely manner.

An energy management initiative using IoT data-tracking and analysis technologies in Charlotte, North Carolina, helped the city reduce total energy costs of “8.4%, equal to 10M in savings.”  Greenhouse gas emissions were also reduced by 20%.


Modes and Pathways

In the field of Transportation, IoT technologies will not only make the modes of transportation safer, from cars to trains, but also the transportation pathways themselves, with smart roads and railways providing real-time data and triggering automated safety and efficiency responses.  Networked sensors will improve transportation efficiencies and safety.

Just how safe will connected cars and smart roads be?   With the adoption of connected car technologies and smart road infrastructure, Verizon predicts that by 2025, “at least five counties will have set a ‘zero road fatalities’ target.”

Standards, a Reliable Cloud  and Security 

Are Critical to IoT Success

Agreeing to standards is still a hurdle in the IoT space, making the decision for partners so critical to reliability, performance and interoperability, the Verizon report notes.

Also, bringing IoT projects to scale deepens the importance of a reliable cloud, as more data is generated and stored.

Enterprises must also be proactive in providing IoT security at every level warns the Verizon report, “not only at the device level.”  The report cautions that in IoT, “every  sensor, device and connection” is a potential risk.  It noted one study that found that “70% of the most commonly used IoT devices contain security vulnerabilities.”

Containing a blunt warning on the risks of an insecure IoT system, the Verizon report notes that hackers could move beyond digital attacks, “like stealing data, moving money, or shutting down websites — they can cause havoc by tampering with infrastructure like electrical grids and traffic signals, or put lives at risk by meddling with healthcare devices, airplanes, or elevators.”  It is a warning that those in the public and private sectors should heed with the greatest care.

The Verizon report lays out a layered approach to security.  It begins with the FTC’s principle of “security by design” and concludes with communications to employees, customers and partners.

“When it comes to IoT, 

you should start small, 

but think big.”

IoT projects don’t have to be huge to make a difference, Verizon says.  Even when enterprises start small, meaningful enhancements in efficiencies and customer satisfaction are likely to be found. 

Wrapping up its IoT report, Verizon notes, “it’s when you start to integrate projects and leverage the data as a whole that it becomes truly transformational.” 

To read Verizon’s complete report, visit the link here (you’ll need to provide some basic information):

State of the Market

Discover how IoT is transforming business results.

Speaking of connections…if we’re not already connected on Twitter, please join me! 

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