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Can We Predict the Size of the Internet of Things Market? By @JHurwitz | @ThingsExpo [#IoT]

The reality of the growth and impact of this market will depend on many factors

Can We Really Predict the Size of the Internet of Things Market?

I had a very interesting discussion the other day with an executive for a technology company. He had just come from a presentation about the Internet of Things (IoT) market. The presenter projected that the market would be valued at around $7 trillion market within the next decade. What did I think about this projection? Is it correct? Is this the true size of the market? Now, as a disclaimer, I don't do market sizing. I assume that those smart people who figure out how big or small a market will be use sound judgment. However, I don't think that as we sit at the dawn of this new era we can truly project the financial impact of the IoT new market. The reality of the growth and impact of this market will depend on many factors. For example, can we anticipate new types of sensor devices that will emerge? Can we project the new uses that smart entrepreneurs will discover that we can't even imagine today? What ecosystems will emerge to take advantage of the platform and the resulting data? Likewise, we also cannot know the potential inhibitors of growth of the market because of unknown factors such as security. What are the unintended consequences of the use of sensor data?

To explain my thesis let's look at one of the most profound innovative markets - the commercialization of the electric light. If a market researcher were to project the number of light bulbs that would be sold over the following five years it would not have been that impressive and the market size would have been modest. But the commercialization of the light bulb was responsible for a massive transformation of society and the invention of hundreds of new markets, new industries. Here are a couple of examples:

  • Factories could run multiple shifts all night
  • New forms of entertainment emerged because citizens didn't feel compelled to go to sleep as soon as it became dark
  • New industries such as motion pictures emerged
  • Surgery could be conducted with better procession

These are only a few examples of the image of the light bulb. The reality is that if one did a study about the size of the light bulb market it would not have mattered at all. What matters are the ecosystems that emerge from an invention. Remember that the real money made during the gold rush in the U.S. west in the 1800s was made by the entrepreneurs who sold equipment to the miners.

Let's get back to the IoT market for a moment. I assume that the predictions of a $7 trillion market projection for IoT over the next decade may not understand the depth of the impact. Let's assume that the ability to understand and analyze data from sensors becomes an important market. The companies that sell software that analyze this type of semi-structured data will make money. Let's assume that there is a market for vendors that can create a new generation of sensors that measure new types of devices. However, the market for IoT will be predicted on the types of solutions that are invented to manage everything from cities to industrial infrastructure to healthcare transformation. The transformations enabled by IoT could be far-reaching in terms of impact and market size. Just as no one could have imaged the impact that the electric light bulb would have, we may not be able to anticipate the long-term impact of IoT.

The post Can We Really Predict the Size of the Internet of Things Market? appeared first on Hurwitz & Associates.

Hurwitz & Associates is a strategy consulting, market research and analyst firm that focuses on how emerging technology solutions solve real world customer problems. Hurwitz research concentrates on disruptive technologies, such as Cloud Computing, Advanced Analytics, Cognitive Computing, Hybrid Cloud Service Management, Data Integration, Security, and Collaborative Computing. Hurwitz offers services such as customer roundtables, multi-client research studies, customer research studies, webinars, and speeches.

More Stories By Judith Hurwitz

Judith S. Hurwitz is president and CEO of Hurwitz & Associates, LLC, a research and consulting firm focused on emerging technology including big data, cognitive computing, cloud computing, service management, software development, and security and governance. She is a technology strategist, consultant, thought leader and author. In 2015 Hurwitz coauthored Cognitive Computing and Big Data Analytics (Wiley, 2015). A pioneer in anticipating technology innovation and adoption, she has served as a trusted advisor to many industry leaders over the years. Judith has helped these companies make the transition to a new business model focused on the business value of emerging platforms. She was the founder of CycleBridge, a life sciences software consulting firm and Hurwitz Group, a research and consulting firm. She has worked in various corporations including Apollo Computer, and John Hancock. Judith has written extensively about all aspects of enterprise and distributed software. Judith is a co-author of six “For Dummies” books including Big Data for Dummies and Hybrid Cloud for Dummies. In 2011 she authored Smart or Lucky? How Technology Leaders Turn Chance into Success. (Jossey Bass, 2011).

Judith holds B.S. and M.S. degrees from Boston University. She serves on several advisory boards of emerging companies. She is on the board of directors of Boston University’s Alumni Council. She was named a distinguished alumnus at Boston University's College of Arts & Sciences in 2005. She is also a recipient of the 2005 Massachusetts Technology Leadership Council award.

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