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The Internet Of Things Is A Fragmented $19 Trillion Roulette Gamble

This article is more than 8 years old.

50 billion connected devices. $19 trillion opportunity. All by 2020.

Forget the numbers you see quoted on every slide deck at a conference because these are meaningless when you analyse just how fragmented this market seems to be. So I'm going to serve you up a new set of numbers.

  • There are 10 major factions fighting to become the standard for IOT
  • 6 vendors in reality control the outcome of the Internet Of Things
  • They have a joint market cap of $670 billion
  • They have net annual sales of $428 billion
  • They employ over 780,000 people between them

And they're not going to give up their chance to define IOT if they can help it.

Cisco, Samsung, Honeywell, IBM , Intel and ARM are playing a calculated game of roulette behind the scenes, whilst appearing on stage with an air of firm commitment in front of potential clients.

Image Credit: Peter C Evans

There are 10 larger initiatives to define standards and frameworks for the Internet of Things globally; Allseen Alliance, Industrial Internet Consortium, Internet Of Things Consortium, IPSO Alliance, LoRa Alliance, Open Internet Consortium, Thread Group, Z-Wave Alliance, Zigbee Alliance, Alliance for the Internet of Things Innovation (AIOTI). There are some notable companies missing here, Microsoft  (or GE Digital as the new spinoff is now known as) and Apple .

To enable widespread adoption and help accelerate the development and evolution of an interoperable peer connectivity and communications framework based on AllJoyn for devices and applications in the Internet of Everything. - Allseen Alliance

We are defining the specification, certification & branding to deliver reliable interoperability -- a connectivity framework that abstracts complexity - Open Internet Consortium

It’s a mesh network designed to securely and reliably connect hundreds of products around the home – without blowing through battery life. - Thread

While there are differences between their focus; for example industrial IOT use cases and smart home interoperability, what's interesting to note is just how many camps these 6 vendors are playing footsie with. Cisco and Samsung are part of seven initiatives. IBM, Honeywell and Intel are aligned with five. Plus a quick look at their mission statements and many are far from realising true interoperability, for example Thread with a mesh based networking protocol.

This is not your grandfathers Betamax vs. VHS format war. With such a large opportunity ahead in the next 5-10 years, defining the standards for the Internet of Things is a massive prize to take home, but the reality is that IOT is not a market but an entire ecosystem and by fragmenting it this way, that realised potential may be some way off.

The Internet of Things needs a real concerted effort to provide stability, security and interoperability across the entire ecosystem, sadly the largest platform vendors in the world are treating this like a roulette strategy and hedging their bets waiting for the ball to drop.

Who will win with this strategy ? It won't be us.

Read my other article on why IOT needs Blockchain, Edge Computing and Open Data to realise its full potential.

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