The Internet of Things (IoT) is the next generation of computing, whereby physical objects interact, potentially independently, with each other and with their environment. It is the combination of distributed information processing, pervasive wireless networking, and automatic identification, deployed inexpensively and widely.

By 2020, IoT is estimated to comprise 50 to 75 billion connected devices and to have driven $14.4 trillion in economic value. 
(Sources: IDC, Gartner, Cisco)

IoT is literally and figuratively everywhere. It is almost impossible to avoid this topic in technology circles, and expectations of IoT’s capabilities are high. 

Drivers of the Internet of Things

Several drivers are in place to accelerate the value capture opportunities offered by IoT:

  • Increased processing power in sensors
  • Ubiquity of wireless connectivity
  • Ever-increasing miniaturization
  • Prevalence of Cloud and Big Data technologies, the building blocks for IoT solutions
  • Massive installed base of 50 to 75 billion connected
    devices by 2020 

Several examples of IoT deployments exist today across consumer, enterprise, and public sector markets, the most prevalent of which are listed below:

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Impact of IoT on Technology Sector

The ecosystem of technology providers and participants in the IoT landscape is vast, ranging from semiconductor companies and sensor companies to telecom providers and analytics software providers. The visual below illustrates key technology components that constitute and participate in the IoT “stack.”

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Waterstone estimates the incremental revenue potential of IoT to the technology sector will be around $450 billion by 2017. Beyond the revenue growth potential, IoT can unlock several strategic opportunities for technology providers, including:

  • New business model opportunities (e.g., recurring revenue streams)
  • Transformation from product to service-oriented business
  • Higher degree of customer intimacy
  • New product innovation opportunities
  • Improved efficiency of distribution channels

Given the opportunity at hand, it is imperative that technology executives gain a deeper understanding of IoT’s impact from an external perspective (i.e., new markets and/or sources of revenue) and an internal perspective (i.e., driving operational efficiency).




Waterstone Helps Clients Navigate the IoT Landscape

Waterstone has considerable experience helping our clients capitalize on IoT across both enterprise and consumer sectors, including:

  • Analyzing IoT sector attractiveness and identifying target use cases
  • Developing market entry strategies, including organic and inorganic options
  • Launching new consumer IoT offerings and associated market testing of concept design
  • Mapping enterprise information flows across functions and systems for IoT deployments
  • Identifying enterprise functional users and usage context for IoT solutions

Our recommendations to clients are built upon a thorough understanding of IoT concepts and the market today.  We have synthesized the knowledge gained through our client work and research efforts into the Waterstone Internet of Things Market Fact Base.  This comprehensive and proprietary database includes information on IoT market trends, innovations, and new offerings as well as use cases for enterprise, consumer, process automation, and information management. 

To learn more about Waterstone’s perspective on IoT and the opportunities it presents, please contact us.