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The Next Phase of the Internet

Tuesday, 17 September 2013.

Over the next five years we will begin to manage our homes in the cloud. Getting access to our information and monitoring our energy use, controlling devices and automating appliances when we are not there will be commonplace. 

phaseofinternetOf course the ‘Smart Home’ has been talked about before but now the catalysts are in place to make it a mass market reality. First of all, the challenges faced by the energy industry mean prices will only continue to rise and the roll out of smart meters will provide connectivity and access to energy data that just wasn’t possible before. Secondly, we are all time starved and cash poor, but we do already have home broadband, smart phones and are accustomed to using them to get access to friends, family and services online and via apps wherever we are. So the next logical step is to access our home through cloud services

The internet has undoubtedly transformed our daily lives. Tim Berners-Lee’s recent launch of the Global Web Index has just reported on the impact the internet has had on citizens around the world. This index has been based on a comprehensive evaluation across seven key areas and 80 indicators from affordability, consumer use and content to infrastructure, speed and government accessibility. Sweden, the USA, UK, Canada and Finland make up the top five nations on the leader board. And there is no dispute that the telecoms industry has underpinned this growth in accessibility and uptake in the leading markets by providing the essential building blocks and high speed connectivity to support the explosion in content and services.

More than this, it has stimulated the ‘Digital Economy’, which is estimated by an AT Kearney report this year to be worth £82bn to the UK economy alone and growing strongly year on year. Over half (55%) of this revenue has not been generated by new pure digital businesses, but has come from value added ecommerce for traditional ones.

However, the same report also warns that we must not be complacent if we want this growth to continue. The demands made on infrastructure providers by over the top services needs to be met with a regulatory environment that encourages ongoing investment in the telecoms backbone.

I believe that the next phase of the internet will be equally transformational. The ‘Internet of Things’ offers the opportunity for us to connect to every device in the home, but not just for information and remote control, also for intelligent automation, where our home works as a system with one device responding to another. This system will also be capable of importing external factors such as weather and energy tariff data so we can dynamically respond to positive conditions to reduce our bills and, at the same time, help the grid to better manage peak demand with fewer resources and less pollution. And it’s not just about cost, its convenience and peace of mind too. Our home will be able to respond to our presence and will provide a safe and comfortable environment.

And the predictions for this market are significant. Globally 38 million smart homes are forecast, generating $6bn in cloud revenues alone by 2015. In Western Europe, 46 million, a quarter of all homes will have smart systems by 2020. In the UK the Energy Saving Trust reports that the average home has 41 appliances – all of these are potentially connectable devices, everything from washing machines to music systems, and this doesn’t take into account the potential for new devices that are not yet commonplace, such as solar panels and motion sensors. Totting these up, it’s not difficult to understand how Cisco has come to its estimate that there will be 15bn internet connected devices by 2020.

The next wave of the internet will also bring a new digital economy 2.0. Integrating connectivity into every device in the home means we will not only be controlling and automating our devices, but also services such as energy provision, monitoring and diagnostics for boiler maintenance, and support service for telecare all going online. It will involve developments in other areas such as hardware and communications technology.

Connecting all of these ‘things’ will also enable us to provide Big Data analysis and feedback to homes, M2M automation and a digital quantified lifestyle for improved efficiency, convenience, comfort and peace of mind. It is a win-win scenario; certainly, Big Data offers undeniable opportunities for businesses – get your policies right and you can improve operational performance, develop new products and services and understand your customer better. And for ordinary people it can result in empowered individuals and communities capable of making smart decisions to make their lives and others that little bit easier and better.

The good news is the customer is ready. It’s less of a revolution for them – they already have the technology and are already using services and apps to be more efficient and informed. Today, if you ask the average punter if they want a internet connected thermostat or washing machine, they might say why?, but ask them would they like to control them from their smart phone, they’d probably say ‘cool’. This will just be another range of services they can get online or as a new app. But we have to put these services into their hands so they can experience then – and then they will ‘get it’.

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