ROI On The IoT

No matter how vast the potential, there are some important variables that could affect profits.


No matter how one spins it, or how it evolves, the IoT/E, CoT will emerge as a monumental money pit, both for those looking it to invest, and those looking to capitalize. I might even go as far as to say that just about everyone will have some sort of investment in it, somewhere, even if it is only a smart toothbrush.

The amount of money going into research, development, and roll out is staggering. Cisco’s analysts came up with a paltry $19 trillion in global opportunities over the next 10 years. When one puts that into the sphere of population, based upon the approximate present global headcount of 7,243,024,817 that amounts to just over $2,623 for every human being on this planet.

My inquisitive mind wants to know what is in it for everyone. And my best deductive answer is that everyone simply sees it as another chance to sell something to someone – the opportunity to make something old (a digital thermostat) new again (the same digital thermostat with an Ethernet or wireless interface that talks to your computer, which in turn talks to your smart device and tell it to come up to 72º via the app someone sold you).

The end result is that there really isn’t anything different about this model than any other paradigm shift of the past. It is just bigger, better and there’s more of it. And it has multitudes of players and avenues for RoI. Even so and simply put, it’s the same old market tussle it has always been. And to be a player, one has to invest.

This one, however, really does have a twist. The perfect marketing scenario exists within the IoT/E, CoT. The supplier gets first-hand knowledge about how their product is utilized. Every time that product gets used, it is logged. Wow! Can you imagine how powerful that is? That means that the vendor can have a real-time feedback loop on the object and make modifications on the fly. They will also, likely, have the ability to change the object’s behavior on the fly.

It’s kind of like ordering a pizza, and when it arrives, you don’t like the look of the olives, so Pizza King can immediately remove the olives and put on anchovies (that scenario will have to wait until we eat, virtually, and eating is just an app that supports the Soylent Green wafer we just had – an idea based on the ’70s cult flick). But the theory is valid. It can work on your thermostat or your vehicle.

The marketing peeps see this as being the ultimate customer retention tool. After all, why would you not keep something that is totally malleable to your needs and desires? And there is value in the aftermarket. Either a monthly support contract, or pay as you go for additional services (like offering to save you money and detergent by monitoring the washing machine load and optimizing the resources per load – would you pay for that)?

This is just one scenario of, likely hundreds, or thousands, or even more. Depending on how the IoT forms, and how that goes, the potential for RoI could be vast.

But there is a caveat. No matter how vast the potential RoI is, there is a fickle factor. Will the user really just turn over control of everything and anything for efficiency and convenience, so they can spend all of their time doing what is pleasurable and not what they have to (Logan’s Run, anyone)? That is a variable that, even though human nature has been studied to death, remains a variable.

Well, that was quite a diatribe for something that is hardly visible today. But, still, parallel computing and quantum cryptograph wasn’t something the pioneers envisioned either.

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