We have all seen the numbers related to the Internet of Things (IoT). 50 billion devices will be connected by 2020 with $19 trillion of business opportunity. It’s a big deal.
But, there is a hidden side to the numbers that a new feature in Forbes magazine has explored. Ten different industry groups are trying to define standards and frameworks for the IoT. Six companies that employ 780,000 people, and have net annual sales of $428 billion, are almost entirely controlling the entire industry.
Forbes suggests that it’s like a giant casino. Each of these big technology companies is presented a united front to their clients, but behind the scenes everyone is fighting to create a dominant position on the bodies that are defining standards.
Wars over standards always break out when new technologies come along. Who can forget the old days of VHS vs. Betamax video? However, this time the prize for being a dominant player is enormous.
The problem here is that the Internet of Things is a concept or strategy. It requires the creation of an entire ecosystem that involves both hardware and software. If every device needs to be connected to every other device then manufacturers across several different industries need to start working together.
The IoT isn’t a foregone conclusion. It will only work with devices that can interact with each other. If large technology companies only see the market opportunity and start battling for turf before even agreeing on how the IoT can and should work then it may never work.
We may end up in a situation where only certain products can link up to others, or worse still, you need to buy everything from a single manufacturer to be able to create a connected environment. It’s time for the big companies in this market to really start working together, rather than just joining trade bodies and pretending there is unity.
As the Forbes features says: “Who will win with this strategy? It won’t be us.”