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An Explanation of the "Internet of Things"

In the product design space the “internet of things” (IoT) is becoming an increasingly important part of the conversation with our clients as they realise the potential it has to impact on how we live, how we work and how we manage our factories and businesses.  But away from all the hype, the jargon and the acronyms, what really is the IoT?

A simple way to look at this;

It is the concept of connecting any device with an on / off switch to the Internet (and/or to each other).

IoT Diagram

This includes everything from phones, appliances, lights, wearable devices and almost anything else you can think of.  In an industrial sense it also applies to all types of components and machines.  

The analyst firm Gartner says that by 2020 there will be over 26 billion connected devices.  The IoT is a giant network of connected “things” (which also includes people).  The relationship will be between people-people, people-things, and things-things.

Let’s start with understanding a few things in our world that are aligning to provide the perfect conditions for the IoT.

  • Broadband Internet is more widely through fixed and wireless networks
  • the cost of connecting and communicating is decreasing,
  • devices can now be created with communication capabilities and sensors built in
  • the costs of technology are going down,
  • battery capacity is increasing and its costs decreasing
  • alternative distributed power sources are coming to market
  • smart phone penetration is rapidly increasing

How does this impact you as the provider of an IoT device and a compelling service to your customer?

In reality, the IoT allows for virtually endless connections to take place, many things we cannot conceive of today.

The insights we see are that;

  1. People will use IoT to control the way that products are used to control information and services that are provided to them.  The devices and products will become less important as objects than they will be as a device that does or delivers something to the user.  The IoT will provide endless opportunities for the personalised automation of the services and responses based on rules that can be controlled by the person.
  2. Companies will deliver more tailored services and outcomes to their customers.  They will have the ability to update the way their products and devices respond and the services that are delivered.
  3. Companies will have access to important insights to how people use their products, how the services the products provide are consumed, when they are used, how they are integrated with other systems to provide automated control.
  4. Companies will be able to understand how the performance of their products changes over time and allow them to make and provide better products and services.  

What are the IoT challenges?

Businesses need to rethink their operations and strategies to realise the different value opportunities that exist in IoT.   Opportunities exist in creating efficiencies in current processes, gaining a better understanding of your customers, but probably the most important opportunities exist for businesses in the latent area of completely new business processes.

There are a host of technology challenges in relation to product performance, but these can be addressed using the same product design processes that we have used for years.

Security is a big issue.  With billions of devices being connected together what can people to do make sure that their information stays secure?  The IoT opens up companies all over the world to more security threats.  

There are issues of privacy and data sharing that need to be understood and accepted.

Another issue facing businesses is the massive amounts data that all of these devices are going to produce.  Companies need to figure out a way to store, track, analyze, and make sense of the vast amounts of data that will be generated.

So where are we at?

IoT is the buzz across technology sectors as communication, hardware and data management companies develop their offerings to sell to businesses looking for the best solution.  You will find start-ups and established heavy-weights alike working the space.

It appears that there will not be one winning solution to the IoT.  Different communication systems, technologies and protocols will be made to co-exist and share.

Over the coming weeks, months and years we will continue to provide you with information from our point of view as we learn with our clients on the development of the IoT.

If this strikes a chord with you or provides a flash of inspiration that you want to explore with your business, please get in contact with our product design team in Melbourne on (03) 9413 9000, or email Mark at This email address is being protected from spambots. You need JavaScript enabled to view it..


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