The Internet of Things (IoT) – a network of devices connected through the internet offering almost limitless possibilities for convenience, efficiency, safety and control through remote sensing, monitoring, and, ultimately, learning – is quickly becoming a reality. According to some estimates, by the year 2020 there will be nearly four times the number of non-traditional devices (think watches and cars) connected to the internet than PCs, tablets and smartphones combined, resulting in a number running into the tens of billions.

Even given these predictions of explosive growth, for now, the IoT is still experiencing a number of growing pains, including security issues and a lack of uniformity preventing seamless compatibility across devices. For their part, several major tech companies are currently in development of a standardized operating system for the universe of IoT connectible-devices which could go a long way in helping to reduce or eliminate some of these concerns.

So, what does this mean in 2015?

  • There is no time like the present for manufacturers, developers, and IoT service providers. The IoT will add trillions of dollars to the global economy and will be the largest device market in the world – within the next half decade. This represents a windfall for IoT firms and translates into innumerable novel opportunities, whether in hardware, software, or in the industries that support them. Many of these opportunities are as-of-yet undiscovered.
  • “Things” are becoming more data-driven. It used to be that “what you see is what you get.” Not anymore. The IoT is flipping the world on its head, and, as it does, essential functions of products may seem like secondary characteristics (case in point: one well-known manufacturer of the common lightbulb is re-tooling its business strategy and planning for a not-so-distant future where the primary revenue stream is based not on the bulb, but on data collection and analysis).
  • As a result, data and access to data will become more prominent, and in some cases, central, to business contracting. Data is at the heart of the IoTevolution and will continue its ascent to becoming the primary IoT commodity. As data becomes increasingly valuable, it will become imperative and increasingly urgent for companies to consider their usage and treatment of it. Questions including which data is shared and how, with whom it is shared, when it is shared (and when it may or should not be), and the liability associated with it – not to mention security and the amount, type and quality of control an owner has and maintains over that data – are just a few issues that can determine the difference between success or failure in the age of the IoT.

The IoT, with all its potential, represents an exciting new frontier, but is laden with pitfalls for the unprepared. As firms – both current operators in the nascent IoT and new entrants alike – consider potential opportunities in this rapidly developing space, it is worthwhile to consider carefully the treatment of their most important resource.