As an industry analyst, one of the many aspects of the technology industry I have to study is the macro-economic trends. With that in mind, it is with great interest that I have been following the media and financial analysts' discussions about whether a new tech bubble is in the works. I live and work in Silicon Valley so I hear a lot of diverse viewpoints on this topic.
There are certainly things to fear, if and when any type of tech bubbles happen. However I believe that what we are entering is a not a new tech bubble but a massive global technology build-out. At the moment, mobile technology is taking the lead, but right behind it is the building out of the Internet of Things (IoT) which various research groups believe could sell up to 200 billion connected devices by 2020.
Although our most mature tech market – PCs – has matured and plateaued, the tech boom is currently being fuelled by interest and demand for smartphones and tablets. However, we are a long way from this market maturing or reaching its plateau. By the end of 2013 we finally sold 1 billion smartphones and by the end of 2016 we should be selling close to 2 billion smartphones a year. And you can add to that a tablet market that should remain strong for at least another three to five years.
But now, we are in the early days of flushing out the Internet of Things, though it could be at least another 10 years before this market develops and matures.
The IoTs or Internet of Everything (IoE) has become a catch-all phrase to describe adding connectivity and intelligence to just about everything to give it specific functionality. At CES 2014, there was an Internet-connected Belkin crockpot that let you adjust settings while away from home. There were also various car vendors that introduced the next generation of connected automobiles, and all referred to them as being part of the IoT. Smart cars, smart appliances, smartwatches, smart homes, and so forth all end up with the "smart" moniker and become tied to the Internet and interconnected to an ecosystem of devices, software, and services.
If you attended CES it was hard to fail to find a product that had some form of connectivity. This was especially true in the health section where about 60 booths showed off health-related wearables that monitored the number of steps taken, heart rate, calories burned, connected blood pressure devices and even personal EKG systems. I was wearing the Fitbit Force wristband and found that I walked in excess of 20,000 steps each day I was at the show.
When I checked out the various cars on the show floor they were all showing off how smart and connected they were. There were connected TV's, refrigerators, appliances, home automation systems, you name it, and it was connected in some way or another to the Internet or a smartphone, tablet, or PC.
The IoE focus on health is quite interesting and I consider it to be very important. In the health section at CES, United Healthcare, which is one of the largest health care insurers in the US, had a large booth that highlighted various health monitoring devices and online educational services. Healthcare providers and insurers know that keeping you healthy and out of hospital is much cheaper and better than taking care of the costs for you if you are sick or admitted to a hospital. So they are very much behind IoE and suggesting that people use things like the Jawbone Up, Misfit Shine, Nike Fuelband, Fibit Force and dozens of other health motivating and monitoring devices to exercise and stay fit.
For the auto industry, connected cars will be the big differentiator for them in the near future. AT&T announced a major platform that can be used by carmakers to add 4G connectivity and services to its vehicles in the US. Last autumn, AT&T introduced a foundry that will serve as a source for automakers to make their cars smarter.
Billions of sensors will be shipped each year that give devices like lights, beacons, appliances, home automation systems, and so on a connection to devices and Internet ecosystems. Qualcomm can deliver these sensors in dedicated products such as beacons and home automation systems as an example, but they can also be added to its Snapdragon mobile processor to deliver sensor capabilities to systems that have Snapdragon inside.
It seems that all industries are focusing on IoE or IoT with the idea that no matter what they have or are doing, the things they make or use will eventually become smarter and connected. Although we have been talking about connected devices since the mid-1990s, I think that we will look back and see that 2013 and 2014 were the years that the industry took a great step forward towards delivering smarter, connected devices – and actually launched the Internet of Everything and the Internet of Things era.
Over the next seven to ten years, all companies will create products and services that fit into a world of smarter connected and interconnected devices, services and ecosystems. While there will surely be some variants on this theme, the bottom line is that the Internet of Everything is the next big thing for tech and pretty much all industries will want to be part of this IoE revolution. More importantly for the tech economy, this next big thing could fuel its growth for many more years to come.