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How To Profit from the Internet of Things

How To Profit from the Internet of Things

The small-business arena is buzzing with hype around the term “The Internet of Things,” and all the “limitless” possibilities it has in store for all of us.

In my experience, many people still don’t really understand what the Internet of Things actually is and just how it is relevant to them. Who can blame them? What is so exciting about the ability to connect your water cooler to the Internet? And, how can that make you money?

Let’s get one thing clear: The Internet of Things is more than connected office appliances. In fact, according to Gartner, the Internet of Things market will top $309 billion in direct revenue by 2020, with most of that money stemming from services.

It’s about services, not products

A $309 billion market can be sliced many different ways, and there are plenty of opportunities outside of the manufacture and sale of connected appliances. I predict the Internet of Things will create a huge services opportunity, or the "Internet of Services," you might say. As the number of devices connected to the Internet of Things grows almost exponentially, analytical software can also be used to extract data to provide critical information about the way devices are functioning and what they are doing. 

So back to our water cooler: How can we turn this previously “dumb appliance” into something to help us cut costs and improve efficiency? A connected device will allow us to identify inefficiencies, such as supply management and maintenance. (These points are hardly major, but it’s a simple way to understand the principle.)

The issue is that many small businesses won’t have the expertise, the time or even the resources to do in-depth analysis of this data themselves. Instead, they probably will turn to their IT partners and use their tools to help reap the benefits brought to them by the Internet of Things.

With these tools, businesses can benefit, and I believe that it’s here that enterprising IT partners can look to make a steady profit.

For example, if you create a software service that can help a factory identify machine malfunction ahead of time, that is worth its weight in gold.

The Internet of Things is set to present a world of opportunity to hundreds of industries in dozens of markets, but it all depends on those making the tools with which to analyze the data.

Don’t get left behind

AVG recently conducted research on the Internet of Things, and there was a strong sense of optimism among small businesses. As many as 38 percent of them expect to adopt the Internet of Things in the next two years, with 60 percent expecting to do so in the next three years.

Clearly, small businesses will be rolling out technology that will supply them with information to help them cut costs, improve efficiency and reveal usage patterns leading to increased profitability, productivity and customer satisfaction. 

Marco La Vecchia is VP Channel Sales, North America, AVG Technologies. Guest blogs such as this one are published monthly, and are part of The VAR Guy's annual platinum sponsorships.

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