The Internet of Things

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The Internet of Things

by James
G. Barr

Docid: 00021357

Publication Date: 2207

Report Type: TUTORIAL


A term coined by technologist Kevin Ashton in 1999, the Internet of
Things refers to efforts designed to extend the dominion of the Internet
from cyber space to the physical world, creating a network of intelligent
devices that form the mechanical equivalent of the body’s central nervous
system. The purpose is twofold: (1) to gather information about
physical processes in order to improve them; and (2) to exercise real-time
control over physical processes in order to affect greater efficiency and

Report Contents:

Related Faulkner Reports
The Internet of Things Market
Trends Market
The Software of the Internet
of Things Tutorial

Executive Summary

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A term coined by technologist Kevin Ashton in 1999,1 the
Internet of Things refers to efforts designed to extend the dominion of
the Internet from cyber space to the physical world, creating a network of
intelligent devices that form the mechanical equivalent of the body’s
central nervous system. The purpose is twofold:

  1. To gather information about physical processes in order to improve
    them; and
  2. To exercise real-time control over physical processes in order to
    affect greater efficiency and effectiveness.

As an example, the US and other nations are presently engaged in building
so-called “smart grids,” electric grids that incorporate microprocessors
to record and report information relative to electric utilization –
information that will enable electric providers (and consumers) to
regulate and conserve costly energy resources.

While the potential impact of the Internet of Things is often diminished
by discussion of questionable applications – like smart refrigerators that
inventory their contents and automatically place orders for depleted food
stuffs – the IoT promises to enhance:

  • Manufacturing, through the introduction of smart production
  • Transportation, through intelligent vehicles and traffic control;
  • Urban infrastructure, through community-wide deployment of smart
  • Healthcare, through “body area networks” and assistive systems; and
  • Emergency response, through IP-enabled surveillance systems.

Importantly, as the IoT evolves, the actions and interactions that occur
in the physical world will rely less on human decision-making, and more on
computational intelligence.2 Like robots on a
manufacturing line, IoT-enabled systems will function more predictably,
more reliably, with greater speed and accuracy, with less expense, and
with better overall results.

Figure 1. An Artist’s Rendering of the Internet of Things

Figure 1. An Artist's Rendering of the Internet of Things


IoT Hypergrowth

According to the US National Institute of Standards and Technology
(NIST), “The IoT is experiencing what some might describe as hypergrowth”.3

Insider Intelligence predicts that by 2026, there will be more than 64
billion IoT devices installed around the world. Companies and
consumers will spend an astronomical $15 trillion on IoT devices,
solutions, and supporting systems from 2018 to 2026.4

Companion Concepts

The Internet of Things (IoT) is sometimes referred to as the “Industrial
Internet” or the “Industrial Internet of Things” (IIoT). NIST has
labeled “the convergence of networking and information processing
technologies [i.e., the Internet] with engineered physical systems” as
“Cyber-Physical Systems” (CPS).

Real Promise

Analyst Arielle Pardes asserts that “The real promise of the Internet of
Things is making our physical surroundings accessible to our digital
computers, putting sensors on everything in the world and translating it
into a digital format. Internet-connected objects could be the key
to unlocking predictions about everything from consumer behavior to
climate events.

Pardes warns, however, that “those same objects could invite hackers into
personal spaces and leak intimate data.” In other words, IoT could
foster “our technological undoing.”5

As analyst Natalie Marchant adds, the rapid proliferation of IoT devices
will greatly increase the global cyber attack surface:

  • Rendering more of the world – its people, properties, and processes –
    vulnerable to hackers and other cyber miscreants; and
  • Reducing the odds of identifying the root cause of a major security


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The Internet of Things reflects a vision of the future in which all objects
– from simple mechanical devices to large-scale physical systems – are
rendered intelligent. In this context, intelligence has several
meanings. For example, it may denote the ability of an object to:

  • Observe and report its own status;
  • Sample its immediate environment;
  • Receive and implement real-time instructions;
  • Exert control over other objects (as directed); and/or
  • Operate autonomously.

To invoke the central nervous system analogy, each object would resemble
a human cell, capable of:

  • Performing its own core functions;
  • Communicating with other cells (and the whole body) through a neural
  • Transmitting sensory data to the brain (the body’s central processing
    unit); and
  • Acting on orders from the brain to affect specific results.

The Internet of Things will manifest in discrete projects, like a Smart
Grid or Integrated Transportation System. Over time, these separate
initiatives may merge, where synergies exist and technologies
permit. The ultimate goal, of course, is to create an efficient
worldwide infrastructure capable of:

  • Self-operation;
  • Self-control; and
  • Self-repair.

IoT Applications

While not yet fully realized, major early IoT applications include smart
homes, wearables, smart cities, and connected cars, as described by
analyst Andrew Meola in Table 1.

Table 1. Major Early IoT Applications
IoT Application Related IoT Device or Example

Smart Homes: The smart
home is likely the most popular IoT application at the moment
because it is the one that is most affordable and readily
available to consumers.

Amazon Echo: The Amazon
Echo works through its voice assistant, Alexa, which users can
talk to in order to perform a variety of functions.

Wearables: The Apple Watch
and other smartwatches on the market have turned our wrists into
smartphone holsters by enabling text messaging, phone calls, and
more. And devices such as Fitbit and Jawbone have helped
revolutionize the fitness world by giving people more data about
their workouts.

FitBit Charge 3: The
Fitbit Charge 3 tracks your steps, floors climbed, calories
burned, and sleep quality. The device also wirelessly syncs with
computers and smartphones in order to transmit your fitness data
in understandable charts to monitor your progress.

Smart Cities: The IoT has
the potential to transform entire cities by solving real
problems citizens face each day. With the proper connections and
data, the Internet of Things can solve traffic congestion issues
and reduce noise, crime, and pollution.

Barcelona: The Spanish
city is one of the smartest cities in the world, having
implemented several IoT initiatives that have helped enhance
smart parking and the environment.

Connected Cars: These
vehicles are equipped with Internet access and can share that
access with others, just like connecting to a wireless network
in a home or office.

AT&T Connected Car:
AT&T was the first telecom company to open a connected car
research and innovation center.

Source: Business Insider7

Federal Use Cases

Similar to the private sector, the Internet of Things is gaining traction
among US federal agencies. The US Government Accountability Office
(GAO) revealed in 2020 that “Many federal agencies (56 of 90) responding
to [a GAO] survey reported using [IoT] technologies. Most often,
agencies reported using IoT to:

  1. “Control or monitor equipment or systems (42 of 56);
  2. “Control access to devices or facilities (39 of 56); or
  3. “Track physical assets (28 of 56) such as fleet vehicles or agency

“Agencies also reported using IoT devices to perform tasks such as
monitoring water quality, watching the nation’s borders, and controlling
ships in waterway locks. Furthermore, IoT use by federal agencies
may increase in the future, as many agencies reported planning to begin or
expand the use of IoT.

“[Thirteen (13)] agencies, [however,] not using IoT technologies reported
[that] they did not plan to use the technologies for a range of reasons,
including insufficient return on investment.”8

Complementary Technologies

As observed by analyst Daniel Wellers, several emerging or evolving
technologies are helping to power the Internet of Things movement:

  • Sensors and actuators, including implantables and
    wearables, that let us capture more data and impressions from more
    objects in more places, and that affect the environment around them.
  • Ubiquitous computing and hyperconnectivity, which
    exponentially increase the flow of data between people and devices and
    among devices themselves.
  • Nanotechnology and nanomaterials, which let us build
    ever more complex devices at microscopic scale.
  • Artificial intelligence, in which algorithms become
    increasingly capable of making decisions based on past performance and
    desired results.
  • Vision as an interface to participate in and control
    augmented and virtual reality
  • Blockchain technology, which makes all kinds of
    digital transactions secure, verifiable, and potentially automatic.”9

IoT Platforms

IoT platforms “serve as the bridge between [IoT device sensors] and
[enterprise] data networks.” Among the top IoT platforms are:

  • Amazon Web Services
  • Microsoft Azure
  • ThingWorx IoT Platform
  • IBM Watson
  • Cisco IoT Cloud Connect
  • Salesforce IoT Cloud
  • Oracle Integrated Cloud
  • GE Predix10

Current View

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5G Effect

According to the “Global IoT Executive Survey,” conducted Business
Insider Intelligence, many of the respondents believe that 5G networks,
with their lightning speed, will have a transformative influence on IoT
performance, and thus capabilities.11


It took nearly a decade for Internet service providers to erect adequate
defenses around servers, storage systems, PCs, and other original Internet
infrastructure. With the emergence of advanced persistent threats,
the Internet security establishment is again losing ground, especially as
hacker exploits are supplemented by state-sponsored attacks. Any
expansion of the Internet ecosystem, like the Internet of Things, is bound
to create new classes of zero-day vulnerabilities.

To help prevent IoT-enabled cyber attacks, analyst Francis Dinha suggests
that consumers:

  • Secure their devices by keeping software updated, using proper filters
    and firewalls, practicing good Internet habits, avoiding phishing scams,
    and watching out for spoof sites.
  • Employ a virtual private network (VPN) to filter incoming traffic.12

Some examples of significant IoT security breaches are highlighted in
Figure 2.

Figure 2. Prominent IoT Security Breaches

Figure 2. Prominent IoT Security Breaches


National Security

Several years ago, the US and Israeli governments (it is widely believed)
collaborated to develop and launch Stuxnet, a computer worm designed to
disable the industrial control systems that facilitated Iran’s nuclear
enrichment program. An act of cyber warfare, the release of Stuxnet
foreshadows a future in which rogue nations (or, in some cases, non-state
actors like terrorist organizations) may be emboldened to attack
IoT-enabled power grids or other critical infrastructure.

Analyst Steve Ranger reports that in 2017, “a US intelligence community
briefing warned that the country’s adversaries already have the ability to
threaten its critical infrastructure. US intelligence has also
warned that connected thermostats, cameras, and cookers could all be used
either to spy on citizens of another country, or to cause havoc if they
were hacked. Adding key elements of national critical infrastructure
(like dams, bridges, and elements of the [electrical] grid) to the IoT
makes it even more vital that security is as tight as possible.”13

Already, state governments are demonstrating their concern about IoT
security. As analyst Brian O’Connell reports, “California … passed
legislation that takes dead aim at the security of IoT devices. Internet of Things device manufacturers must comply with security mandates
that thwart cyber attacks and data breaches linked to Internet of Things
devices and connectivity tools.”14

Personal Privacy

Closely related to security, the public is interested – rightfully – in
the protection of their personally identifiable information (PII). The Internet of Things may open new “threat vectors,” through which bad
actors can steal, destroy, or misappropriate sensitive, confidential, or
proprietary information.

Consumers, through their smart home devices like coffee machines, smart
toothbrushes, smart speakers, smart refrigerators, and smart toys, seem
especially vulnerable.15

Wanted: Standards

Legal and regulatory regimes never keep pace with technological
advances. While it’s not realistic to put IoT development “on hold”
while lawmakers ponder the consequences of implementing the Internet of
Things, basic IoT frameworks are needed to:

  • Ensure the rights of private citizens;
  • Resolve conflicts between competing parties, including legal
    liability “for the bad decisions of [newly] automated systems;”16
  • Optimize IoT operations by establishing IoT interoperability and
    compatibility guidelines; and
  • Protect IoT infrastructure against cyber attacks.

Recognizing the standards gap, the International Organization for
Standardization (ISO) has been busy producing global IoT standards like
ISO/IEC TR 30164:2020 “Internet of things (IoT) – Edge computing.”

For its part, the US Congress passed the Internet of Things
Cybersecurity Improvement Act of 2020.

This bill requires that NIST and the Office of Management and Budget
(OMB) take specified steps to increase cybersecurity for Internet of
Things (IoT) devices.

Specifically, the bill requires NIST to develop and publish standards and
guidelines for the federal government on the appropriate use and
management by agencies of IoT devices owned or controlled by an agency and
connected to information systems owned or controlled by an agency,
including minimum information security requirements for managing
cybersecurity risks associated with such devices.

The bill requires the OMB to review agency information security policies
and principles on the basis of the NIST standards and guidelines and issue
such policies and principles as necessary to ensure the agency policies
and principles are consistent with the NIST standards and guidelines.


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While the Internet of Things will continue to expand both in scope and
“national significance” (the economic incentives are too great to ignore),
the pace of progress will be dictated, not surprisingly, by the rate at
which IoT-enabling technologies evolve, and become standard features
within the enterprise landscape.

IPv6 Addressing

Internet Protocol version 6 (IPv6) is the planned next generation of the
IP protocol slated to succeed IPv4. Since the Internet of Things
requires that all things be Internet-addressable, millions – make that,
billions – of additional IP addresses will be needed to satisfy future IoT

IPv6, with its new 128-bit address space, provides an enormous number of
unique addresses, 2128 (or 3.4 X 1038) addresses,
compared with IPv4’s 232 (or 4.3 X 109) addresses.17

Although many enterprises have been slow to adopt IPv6 due to security and
other issues, the Internet of Things may provide the momentum needed to complete
the IPv4 to IPv6 transition.

Big Data

With millions, even billions, of new devices poised to become
data-generating Internet “endpoints”, the Internet of Things will produce
“Big Data,” a term which refers to the massive amounts of data being
generated by business and industry on a daily basis – data which, like IoT
data, cannot be processed using conventional data analysis tools owing to
its sheer size, and, in many cases, its unstructured nature.

Enterprise architects will have to devise an IoT-inclusive Big Data
strategy before they pursue any large-scale IoT projects.

Business Processes

Analyst Bernard Marr asserts that the Internet of Things will change the
way we do business. For example:

  • Inventory management – “Smart devices will
    ultimately be able to track inventory automatically.”
  • Consumer demands – “Consumers will get used to smart
    devices and begin to expect ‘smart’ behavior in all aspects of their
  • Shorter buying cycle – “Businesses will need to come
    to terms with a shorter buying cycle and consumer expectations for
    immediate gratification that the IoT supports.”
  • Business intelligence – “The volumes of data
    generated from smart devices help businesses learn how and what to
    innovate for the biggest impact.”
  • Remote work – “As IoT becomes more integrated,
    additional remote working opportunities will be available for tasks that
    used to require staff to be on-site to complete.”18

In or Out

Presuming that the Internet of Things will not encompass everything,
there are several key questions that IoT policymakers must address:

  1. What objects will not be incorporated into the IoT?
  2. Who will decide what’s in and what’s out?
  3. Just as people today can opt out of Internet usage (though, from a
    practical standpoint, it’s increasingly difficult), will individuals be
    permitted to “unplug” from an even more ubiquitous Internet of Things?

Internet of Everything

For another view, analyst Arielle Pardes believes that the Internet of
Things will evolve, almost inevitably, into the “Internet of
Everything.” Elaborating on her vision, Pardes predicts that “The
objects in our world might sense and react to us individually all the
time, so that a smart thermostat automatically adjusts based on your body
temperature or the house automatically locks itself when you get into
bed. Your clothes might come with connected sensors, too, so that
the things around you can respond to your movements in real time. That’s already starting to happen.”19

Trustworthy Network of Things

NIST is working with industry sources to develop and foster adoption of
network-centric approaches to:

  • Protect IoT devices from the Internet, and
  • Protect the Internet from IoT devices.

Prominent initiatives focus on:

  • The research and development of software-defined networking
    technologies in support of IoT security.
  • The design and standardization of technologies to securely “on board”
    IoT devices.
  • The application of automated model checking techniques to verify the
    security properties of emerging IoT security protocols.
  • Research on the application of zero trust architecture to IoT

Factory and Human-Health

Projecting the IoT’s influence, McKinsey concludes that in the coming
decade the factory and human-health “settings” will exhibit the greatest

  • “Factory, the setting with the largest potential economic value in
    2030, could generate around $1.4 trillion to $3.3 trillion by 2030, or
    26 percent of the [IoT] total. Based on our research, the greatest
    potential for value creation in the factory setting will be optimizing
    operations in manufacturing – making the various day-to-day management
    of assets and people more efficient.
  • “In the human-health setting, the second largest, IoT value involves
    applications that are deployed in and affect the human body. We estimate
    that IoT economic impact in the setting could reach around 14 percent of
    the total, or between $0.5 trillion and $1.8 trillion, by 2030. IoT
    solutions are not only being used by individual customers but also being
    provided by some insurers and governments as a way to improve health and
    patient outcomes.”21


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“The next chapter of IoT is
just beginning as we see a shift from digitally enabling the physical to
automating and augmenting the human experience with a connected world.”

– Carrie
MacGillivray, vice president of IoT and mobility at IDC22

Like cloud computing, the “next big thing” on the Internet horizon, the
Internet of Things, offers tremendous promise; in the case of IoT, the
ability to organize and control assets in the physical world in the same
way we organize and control information assets.

Over the last decade, in particular, information firms, like Google,
Amazon, Apple, and Microsoft, have shaped the way the Internet looks and
operates. In the coming decade, their industrial counterparts, firms
like General Electric, Honeywell, Siemens, and United Technologies, will
likely exert similar influence over the Internet of Things.

Regarding enterprise adoption, analyst Aviva Leebow Wolmer believes that
"Businesses should not steer clear of IoT solutions because they are imperfect
or because they require company leaders to overcome logistical hurdles; the
potential payoff is far too high.

“Moreover, IoT solutions will likely become a norm in business, making
integration less of a tech-forward decision and more of a necessity for
keeping up with the competition. Integrating IoT technology can and
should be a priority; however, companies will need to have advanced
analytics and development platforms in place to handle the influx of IoT
data, as well as cybersecurity solutions that address any vulnerabilities
that IoT technology creates in a company’s day-to-day systems.”23

Some less sanguine about the benefits of IoT feel that except for those
sectors already engaged in IoT operations – industries like Energy,
Manufacturing, and Transportation – the best course for enterprise
planners is to wait and watch – watch for:

  • The development and maturation of versatile IoT tools – providing
    enterprise clients with ready access to IoT market opportunities;
  • The emergence of established IoT service providers – offering
    enterprise personnel valuable insights into the conduct of IoT
    operations; and
  • The formulation of recognized IoT standards – guaranteeing enterprise
    executives a degree of regularity in all matters related to IoT.

As a society, we set sail on the Internet without knowing the obstacles
that lay ahead. Chastened by that experience, we should approach the
Internet of Things with greater respect and caution.


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About the Author

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James G. Barr is a leading business continuity analyst
and business writer with more than 30 years’ IT experience. A member
of “Who’s Who in Finance and Industry,” Mr. Barr has designed, developed,
and deployed business continuity plans for a number of Fortune 500
firms. He is the author of several books, including How to
Succeed in Business BY Really Trying
, a member of Faulkner’s
Advisory Panel, and a senior editor for Faulkner’s Security
Management Practices
. Mr. Barr can be reached via e-mail

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