Fellow Travelers: Big Data and the Internet of Things

Stephen DeAngelis

September 4, 2013

“Bland by name and superficially viewed as gee-whiz technology never to be realized, the IoT (Internet of things) has significant potential to transform business,” writes Bob Violino. [“The ‘Internet of things’ will mean really, really big data,” InfoWorld, 29 July 2013] Why, you might ask, is the Internet of things viewed as science fiction by skeptics? The simple answer is that it holds the promise of connecting billions of machines (everything from cars to refrigerators) that will hold virtual conversations with each other. In another article, Violino defines the Internet of things this way:

“The term carries a number of definitions. But in general, the IoT refers to uniquely identifiable objects, such as corporate assets or consumer goods, and their virtual representations in an Internet-like structure. … In effect, these networked things become ‘smart objects’ that can become part of the Internet and active participants in business processes.” [“What is the Internet of Things?Network World, 22 April 2013]

Ericsson, the Swedish technology firm, has a vision of the world in which 50 billion devices are continuously connected and communicating. On its website, the company writes:

“The vision of more than 50 billion connected devices, based on ubiquitous internet access over mobile broadband, devices or things will be connected and networked independently of where they are. Falling prices for communication, combined with new services and functionality connecting virtually everything to serve a wide range of commercial applications, individual needs and needs of society. The 50 billion connected devices vision marks the beginning of a new era of innovative, intertwined, combined products and services that utilize the power of networks.”

If that vision comes true, the IoT will clearly be much larger than the “human” Internet with which we are all familiar. Violino writes, “Promising unprecedented connectivity among objects and the gathering of massive amounts of data, IoT is poised to deliver significant business benefits to organizations forward-thinking enough to envision the opportunities and efficiencies IoT can reap.” In fact, the amounts of data that will be generated by the IoT will be so massive that the term Big Data seems entirely inadequate to describe it. Evangelos Simoudis warns, “While our ability to collect the data from these interconnected devices is increasing, our ability to effectively, securely and economically store, manage, clean and, in general, prepare the data for exploration, analysis, simulation, and visualization is not keeping pace.” [“Big Data and the Internet of Things,” Enterprise Irregulars, 26 February 2013] He continues:

“The Internet of Things necessitates the creation of two types of systems with data implications. First, a new type of ERP system (the system of record) that will enable organizations to manage their infrastructure (IT infrastructure, human infrastructure, manufacturing infrastructure, field infrastructure, transportation infrastructure, etc.) in the same way that the current generation of ERP systems allow corporations to manage their critical business processes. Second, a new analytic system that will enable organizations to organize, clean, fuse, explore and experiment, simulate and mine the data that is being stored to create predictive patterns and insights. Today our ability to analyze the collected data is inadequate.”

General Electric, which calls the IoT the “Industrial Internet,” is convinced that this machine-to-machine network represents the future. Bill Ruh, Vice President and Global Technology Director at General Electric, writes:

“Big Data, a term that describes large volumes of high velocity, complex and variable data that require advanced technologies to capture, store, distribute and analyze information, is at a tipping point, with billions being spent to turn mountains of information into valuable insights for businesses. But there is more to Big Data than numbers and insights.” [“GE Insight: The Industrial Internet – Even Bigger Than Big Data,” Financial Post, 31 May 2013]

Although Ruh believes that “Big Data is the lifeblood of the Industrial Internet,” he also believes the Industrial Internet is “about building new software and analytics that can extract and make sense of data where it never existed before – such as within machines.” Beyond that, he believes that machine learning will be used “to make information intelligent.” To make this happen, he writes that “new connections need to be developed so that Big Data ‘knows’ when and where it needs to go, and how to get there.” He continues:

“By connecting machines to the Internet via software, data is produced and insight is gained, but what’s more is that these machines are now part of a cohesive intelligent network that can be architected to automate the delivery of key information securely to predict performance issues. This represents hundreds-of-billions of dollars saved in time and resources across major industries.”

Obviously, machines aren’t going to spontaneously connect. The process begins “with embedding sensors and other advanced instrumentation in the machines all around us, enabling collection and analysis of data that can be used to improve machine performance and the efficiency of the systems and networks that link them.” [“Big Data Will Drive the Industrial Internet,” by Thor Olavsrud, CIO, 21 June 2013] Olavsrud cites a paper written by Peter C. Evans, director of Global Strategy and Analytics at GE, and Marco Annunziata, chief economist and executive director of Global Market Insight at GE, entitled, Industrial Internet: Pushing the Boundaries of Minds and Machines. In that paper, Evans and Annunziata assert, “The compounding effects of even relatively small changes in efficiency across industries of massive global scale should not be ignored.” They explain:

“As we have noted, even a one percent reduction in costs can lead to significant dollar savings when rolled up across industries and geographies. If the cost savings and efficiency gains of the industrial Internet can boost U.S. productivity growth by 1 to 1.5 percentage points, the benefit in terms of economic growth could be substantial, potentially translating to a gain of 25 to 40 percent of current per capita GDP. The Internet Revolution boosted productivity growth by 1.5 percentage points for a decade — given the evidence detailed in this paper, we believe the industrial Internet has the potential to deliver similar gains and over a longer period.”

Mike Wheatley agrees with the folks at GE that the Internet of Things is more than science fiction. “There’s no holding back the Internet of Things,” he writes, “this is where the world’s heading, and we’re already seeing it in concepts ranging from smart electricity meters to IBM’s rather more ambitious Smart Cities initiatives. The basic fundamental holding IoT together is connectivity, a world in which machines with intelligent sensors are hooked up to the web, and able to deliver a stream of constant data.” Critical to that connectivity, he believes, is cloud computing. [“Cloud Computing & The Internet of Things go Hand in Hand,” Silicon ANGLE, 17 July 2013] He continues:

“The Internet of Things … won’t be made possible by a jumble of wires. What makes it possible is cloud computing, combined with the glut of sensors and applications all around you that collect, monitor and transfer data to where it’s needed. All of this information can be sent out or streamed to any number of devices and services. … Of course, this means that there’s going to be an awful lot of data flying around out there, data that needs to be processed quickly. … This is why the cloud is so important. The cloud can easily get a handle on the speed and volume of the data that’s being received. It possesses the ability to ebb and flow according to demand, all the while remaining accessible anywhere from any device.”

If Evangelos Simoudis is correct that currently “our ability to analyze the collected data is inadequate,” then Wheatley might be a bit optimistic in his assessment of how easy it is going to be to manage the IoT. I do agree with him, however, that the cloud will be essential to the IoT’s development. One thing that all analysts seem to agree on is that once the IoT is up and running, the amount of data it will generate will be humongous.