What's Wrong with the Internet of Things

At an Internet of Things conference last week, I took part in a panel in which we discussed the future of connected devices. Will simple products win or will complex products dominate in the IoT?, we were asked. I think the question misses the point and raises another problem about the Internet of Things more broadly. It’s not about Things. It’s about Services. Software-as-a-Service and Platform-as-a-Service.

Simplicity and complexity are two sides of the same coin. Great products are simple on the surface, but devote tremendous energy under the surface to handle complexity on behalf of the user. Great products are like ducks. Ducks are calm above the water despite paddling furiously below it.

For Internet of Things products to be successful, user interfaces must be simple, just as in any other product. It’s table stakes. The complexity that lies underneath should be tucked away. That’s the problem with the name Internet of Things or connected devices. The majority of the user value isn’t about the things at all, but the services that power the things. In fact, the most successful connected devices should disappear from a user’s mind altogether. That the devices are connected at all or even exist should simply be forgotten.

Most of the magical technology experiences hide complexity with simplicity in this way. Apple’s motto “it just works” captures the notion succinctly. Hail an Uber with the push of a button while a logistics and voting system finds the right driver. Photograph a receipt on Expensify and have the contents automatically transcribed for you. Dig through data on Looker, while a database creates the right queries to answer your question instantly.

The promise of the internet of Things is a world where objects think on our behalf, what I’m calling anticipatory computing, for example checking into a flight automatically as I enter an airport terminal. Or an air conditioner that automatically changes its settings depending on the weather. In both those examples, technology disappears into the background, enabled by data.

Data will lead the revolution. It will lead to a revolution in platforms that enable the collection and use of data, like Electric Imp. The data will lead to a revolution in the analysis of that data and consequently in the infrastructure from server to database to business intelligence suite, which is why 75% of companies surveyed by the Economist in 2013 are pursuing initiatives in the Internet of Things.

While the initial winners in the IoT category will be consumer facing products, I suspect the vast majority of market value creation will happen behind the scenes, in service companies and database companies, analysis companies and platform companies to build products that the end-user will never see: the SaaS and PaaS products that enable magic to happen.

When we achieve that vision of intertwining data and technology to transform connected devices into forgettable wallflowers, then the true promise of the Internet of Things will be realized, and the moniker will simply vanish because it will be meaningless. At that point, the real value will remain in the services behind the scenes processing terabytes of data to help people live better lives.

Published 2014-05-20 in trends 


I am partner at Redpoint. I write daily, data-driven blog posts about key questions facing startups. I co-authored the book, Winning with Data. Join more than 20,000 others receiving these blog posts by email.

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