The Internet of Things is founded on familiar technologies like sensors, networking and cloud computing. But its potential for transformation is incredible.

More connections ahead

A recent study from ABI Research shows that the IoT market is likely to experience strong growth, rising to 5.4 billion connections across the globe by 2020, counting cellular, fixed line, satellite and short-range wireless connections, up from 1.2 billion devices today.

By connecting things in the real world, such as cars, buildings and industrial equipment, the IoT promises to revolutionize how we live and work. From wearable devices to smart cities, the benefits reported have prompted organizations of all sizes to ask how IoT might affect their organization and their industry, and what they can do with it.

How the consumer fits in

The Internet of Things combined with social media has transformed expectations as consumers, employees or citizens. People want greater personalization and more integrated service, and this demand is creating a pathway for new business models and use cases.

"People want greater personalization and more integrated service, and this demand is creating a pathway for new business models and use cases."

For example, the transportation industry has changed a lot in a generation. Fuel economy has soared, and vehicles have gone from being practical to luxurious: a second home. But the expectations of passengers, vehicle buyers and regulators are demanding even greater advancements. In addition to greater comfort and safety, transportation companies must offer greater economy and meet increasing environmental standards.

The push toward smart cities

As the population of urbanites who don’t own cars continues to grow, public municipalities and private companies are turning to vehicle sharing or unattended rental programs as a way to broaden transportation options, enhance their sustainability initiatives and turn vehicles into profit centers.

Changing consumer and workforce demographics that skew toward younger populations, increasing societal expectations for mobile technologies that are available virtually anywhere, anytime, as well as changing attitudes about car ownership, particularly in urban markets as a way to reduce carbon emissions caused by traffic congestion, are all driving today’s sharing economy.

Consider these six trends:

  • Americans still waste $120 billion a year sitting in traffic
  • Thirty percent of the congestion in cities is caused by people looking for a parking space
  • More than 200 million cars in the U.S. have no connectivity
  • More than 33,000 Americans still lose their lives in traffic accidents each year
  • Two-thirds of the world’s population will live in urban areas by 2040
  • At 80 million strong, millennials are today’s largest and most influential generation

Smart service

As a result of these influences, the transportation industry and its ecosystem partners are tapping into the Internet of Things to help create new opportunities to improve people’s lives and make societies function more efficiently.

But it needn’t be daunting. The Internet of Things isn’t just for multinational companies investing tens of millions of dollars. Projects don’t have to be huge to make a difference. A few dozen sensors and simple automated alerts can cut costs, create new revenue opportunities and transform customer service. Once they begin to realize measurable results, organizations that have planned properly can expand existing projects and launch new ones quickly.