The Internet of Things will continue to creep into consumers' homes in 2014, but the real growth in the next year is likely to be in the enterprise.
One contributing factor to this lag in the consumer market is that most consumers don't know the Internet of Things (IoT) exists. ISACA's 2013 IT Risk/Reward Barometer report (PDF) released in November found that although many consumers report using devices that fall into the IoT category, such as GPS systems (62%) or electronic toll devices on cars (28%), just 16% are aware of the term "Internet of Things."
Even so, growth in the Internet of Things will not necessarily rely on awareness of the term. Consumers faced with new purchasing decisions, from upgrading light switches and outlets to buying household appliances when their old ones break, will choose those that boast Internet connectivity for remote control and energy saving purposes. Cisco has estimated that the Internet of Things will grow to 50 billion devices by 2020. Awareness of the term may not grow even as the technology takes over consumers' homes.
This kind of organic growth is expected to come in the next few years, but most of the evidence shows that 2014 will not be the tipping point for consumer adoption. In June 2013, The Economist conducted interviews for its Internet of Things Business Index sponsored by ARM (PDF), finding that "low consumer IoT awareness may be hindering faster development in the sector." In fact, the study found that "the single largest group (40%) of businesses are researching the IoT while 17% are planning to roll out an IoT-based product." Although the study predicts a "flood" of IoT products and services into the market in the next few years, the recent reluctance to move from planning to actually developing products suggests that 2014 may not be the year the market reaches its potential.
Even accounting for IoT products currently available, some wonder how long it will take for consumer adoption to build momentum. For example, The Economist's report cited Belkin, whose first IoT product has been on the market for about 18 months. Called the WeMo, it combines Wi-Fi-enabled plug sockets and light switches with smartphone apps to enable consumers to control their energy efficiency. The WeMo has been credited for relatively easy installation, but any kind of installation requires extra work on the part of the consumer. These are the kinds of obstacles that other high-growth markets, like those for smartphones and tablets, don't face.
"Right now, if you think about it, the Internet of Things in your household will probably require you to go and re-purchase many devices that you have today, and I'm not sure how many of us can take that hit in one calendar year," Robert Stroud, a member of ISACA's Strategic Advisory council and vice president of innovation and strategy at CA Technologies, says. "I actually think it might apply more in commercial ventures first."
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