Slow evolution from M2M to IOT

With its vibrant vehicle telematics and fleet management market, South Africa has been at the forefront of machine to machine (M2M) communication for years. Now, many of the country's leading enterprise IT users and solutions providers are beginning to look at how they should evolve from basic M2M to more advanced Internet of Things (IOT) applications.

Business making decisions off data rather than gut feel will be driven by the IOT and big data capabilities.

Quinton Pienaar, CEO, Agilitude

The IOT is a network of intelligent devices and machines that can monitor themselves as well as gather contextual information using sensors, and share it with other devices and services. As these machines and devices become smarter, they can potentially even take automated actions, such as an overheating machine shutting itself down before it's damaged.

Marketer researcher Gartner projects the IOT will include 26 billion units installed by 2020, which is an almost 30-fold increase on 2009. These will not just be consumer wearables like fitness devices, but also things like plant machinery, fleet vehicles, home automation, building security systems, connected cars and more. Businesses will be able to monitor and control these machines from anywhere.

"The IOT is an evolution of M2M technologies," says Mark Warren, M2M Solutions manager at Gemalto South Africa. "M2M is the connection of individual assets to devices to track something or optimise a part of a process." The IOT, by contrast, is a flexible network of interconnected devices, assets, processes and systems to improve business models and profit, increase efficiency, and optimise the use of resources.

As an example of the potential of the IOT, Quinton Pienaar, CEO of Agilitude, points to smart factories, where parts are requested in real-time by the very machines that need to assemble them. A Jeep Wrangler factory in Ohio, for example, weaves together 60 000 individual devices, including factory-floor robots. These devices all communicate among themselves to create an almost autonomous organism that produces a car body every 77 seconds.

Another industry that could benefit from the IOT is agriculture. "Some farms in the US and Europe have already proved to be early adopters," says Pienaar. "They bring big data to the field with tools that can dynamically calibrate moisture and other metrics. This data feeds into selective irrigation systems and microclimate control. Connected devices even optimise field-to-shelf supply."

In the healthcare market, the latest innovations include contact lenses that measure blood sugar and send readings via smartphone. "This type of connected world and connected customer will become more commonplace. Business making decisions off data rather than gut feel will be driven by the IOT and big data capabilities," says Pienaar.

Despite the potential, most observers agree this world of machines that work together to make decisions for us is still some way in SA's future. "To say we're moving into an IOT environment is premature," says Warren, adding he expects it to take five to 10 years before the IOT becomes a reality in Africa.

However, M2M connections are expected to enjoy dramatic growth in SA and the rest of the continent. Africa has 32% of the world's landmass and 3% of M2M connection, leaving plenty of headroom for growth, says Warren. Machina Research reckons there are around 100 million connected things in Africa, a number that is expected to grow nine-fold in the next few years.

The IOT is still a work in progress in terms of who pays for it and who gets value.

Tony Smallwood, executive head of M2M and vertical industries, Vodacom

Hymie Marnewick, chief commercial officer at XLink Communications, says his company has installed more than 100 000 M2M devices, including point of sales devices, over the past 10 years. M2M adoption is rising in industries as diverse as retail, healthcare and utilities, he adds. That's one reason why MNOs Vodacom, which owns a 50.1% share in XLink, and MTN are targeting the market for growth.

Tony Smallwood, executive head of M2M and vertical industries at Vodacom Business, says the IOT includes a heavy consumer focus, while M2M is almost exclusively about business-to-business applications. "In terms of commercialisation, there is already a solid business case for M2M," he adds. "The IOT is still a work in progress in terms of who pays for it and who gets value."

One example of an M2M application benefiting companies and consumers is vehicle telematics, which provides an insurance company with information about your driving behaviour, for example; how often and how hard you break, your driving speed, and your mileage. In future, insurers might use big data analytics tools to crunch this data to offer personalised risk assessment and pricing or to create innovative products such as usage-based insurance, says Smallwood.

For now, the consumer side of the IOT is more mature than the business-to-business side, says Bruce Taylor, chief solution and marketing officer at Dimension Data Middle East and Africa. "The consumer IOT is set to explode in the next year or two," says Taylor. The same isn't true for the industrial Internet because it first needs the deployment of ubiquitous ultra-low bandwidth networks and the resolution of standards wars such as a tussle between Qualcomm and Intel, he adds.

The lowly QR code can turn an unconnected object, such as a shipping container, into a smart object.

Russel Brand, innovation consultant, T-Systems

Connecting objects and bringing real-time intelligence into business activities will demand cheap, ubiquitous connectivity, and powerful big data capabilities, says Russel Brand, innovation consultant at T-Systems in SA. Until organisations and industries solve these issues, B2B adoption of the IOT is likely to remain subdued.

What's more, regulations and models for security, trust, privacy, ownership of data, and contractual models are all in their infancy, says Taylor. This is a major challenge, since an IOT ecosystem such as the connected car could bring together parties such as the owner of a car, the insurer, the motor manufacturer, and petrol stations.

Initially, much of the action in the IOT space will be in consumer wearables and the like, agrees Avi Mistry, head of commercial and government at Intel SA. With form factors of consumer devices shrinking even as they become more affordable, adoption is likely to grow in the next year or two.

Rather than fixating on the most complex and sophisticated solutions, companies should perhaps think about looking at lower-tech alternatives, suggests Brand. "Take, for example, the lowly QR code. This simple sticker can turn an unconnected object, such as a shipping container, into a smart object. Via its interactions with the smart devices that scan the codes, we can determine GPS locations at specific points-in-time," he adds.

Such a simple technology could be used for a range of applications, such as integrated marketing campaign management, coupons or tracking the delivery and allocation of rental vehicles.