Last updated: 05 July 2017
The IoT has become such a widely used term that it feels like it’s been around for decades. Interestingly, even though it made it to the peak of inflated expectations in Gartner’s Hype Cycle, the term itself had been coined back in 1999, almost two decades ago!
The development of the IoT converges multiple ecosystems and technology realms. It has real potential for telecom operators looking to extend connectivity from humans to machines; for governments working on smart city projects; for consumer electronics manufacturers (OEM) building connected wearables; and of course for banks trying to diversify payment services or for enterprises, looking to capitalize on the big data produced by billions of sensors. Such is the beauty of IoT –it unites many different industries and sectors.
While the promise of IoT is immense, the complexity of integrating heterogeneous ecosystems is admittedly a challenge, and one that is best handled by players that understand the digital nature of these heterogeneous systems.
This is where trust comes into play. Let’s consider a connected car. Vehicles, today aren’t just a piece of great hardware engineering; they’re increasingly becoming software platforms on wheels. Tesla’s “ludicrous mode”, for example, is a software upgrade that transforms the vehicle into a sporting beast, capable of beating a Ferrari or a McLaren.
Nowadays, there’s software all around you in a vehicle. The infotainment screen (ICE) resembles a tablet running software. The transmission is controlled by some software/firmware on an ECU (engine control unit). The latest cars are also equipped with Wi-Fi hotspot capabilities, serving your high speed Internet through a cellular network.
The question is, do manufacturers like BMW, Audi, Ford build all these components on their own? No. Each automaker requires many different automotive OEMs, software developers, network providers, chipset manufacturers and other contributors, to contribute their own intellectual property to deliver a superior driving experience that you can trust your life with.
And this forms the basis for a chain of trust, with every stakeholder involved. The automaker is now an integrator of different hardware, software, networking and data components—and, most importantly, the integrator of trust.
Let’s take a more recent example of convergence – mobile payments. Mobile payments and mobile banking took a long time to evolve, especially in developing countries. And the opportunity was there all along, lying unnoticed – banking the unbanked or improving financial inclusion. Was the lack of progress because the technology didn’t exist? Or was it that the mobile network operators, the de facto channel, didn’t have an agent/merchant network? Or perhaps the banks didn’t want to invest in such a large untapped but also unproven market?
The barrier, aside from business ownership challenges was a lack of trust. Going beyond the question of who owns the customer, there was a question of who owns the data and who owns the technology. And there was and is no definitive answer. There’s no one-size-fits-all model.
The whole world is going digital. IoT, because of its scope, is unprecedented in its transformational power. But at the same time, it inherits the same issue from all the other digital ecosystems that it promises to converge; how to ensure trust. The magnitude of the problem is even bigger in the case of IoT, since its implications cover a broad span of industries, as well as consumers’ lives at large.
The mantra underlying the attempt to build trust in this ecosystem is to have the right enabling technologies that help ecosystem players connect, secure and monetize their IoT assets.
Stay tuned for Part II – and check out our infographic for more information.