"Is IoT the Next App Store?"

Scott A. Snyder, Chief Technology and Innovation Officer, Safeguard Scientifics, Inc. and Rick Bullotta, Founder, Next Big Thing, LLC

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Scott A. Snyder, Chief Technology and Innovation Officer, Safeguard Scientifics, Inc.

It is hard to think about the current wave of digital innovation and empowered end-users without thinking about apps. Despite the app store concept in its current form really only taking root in 2008 with the launch of Apple’s App Store for iOS, we have been app crazy as a society, with over 4 million unique apps downloaded over 200 billion times by users around the world.

And while the reinvention of the smartphone by Apple and Google fundamentally changed our digital user experience, it also did something even more powerful by democratizing innovation. It enabled anyone with a good idea to push it out as easily accessible software to be downloaded by smartphone users around the world. This continues to level the playing field in major industries everywhere, upending entrenched businesses in transportation, retail, banking, and even healthcare.

Meanwhile, the Internet of Things (IoT) has been living in the back-office of industrial companies, virtually invisible from everyday consumers with the exception of a few shiny objects like Nest Thermostats and connected toy drones. But what if IoT could harness the same power of the app store to reach the masses with new innovations? What if innovators could publish vertical software apps, embedded apps and cool cloud services, utilities or analytics through the IoT store?

In many ways, this is already happening; we just may not realize it.

What makes IoT unique is that an “app” is a multi-dimensional and multi-tier concept, unlike “apps” in the mobile world. A substantial number of mobile phone applications are standalone or have minimal network interaction, and most others are relatively simplistic front-ends connected to back end cloud services or applications. In the IoT, application code runs on a remote device (or on the “edge”, as it is also referred to), in the cloud (usually on major PaaS from Amazon, Google, or Microsoft), and more often than not, the user interface runs on a mobile device (tablet or phone).

What makes IoT unique is that an “app” is a multi-dimensional and multi-tier concept, unlike “apps” in the mobile world

On the device/edge front—in addition to a massive volume of commercial IoT devices and gateways—tens of millions of Raspberry Pi, Arduino, Phidgets and similar devices have been shipped and pushed mostly into the hands of young innovators around the world. These are being customized for new IoT applications. In addition, these connected devices have become more “mainstream”, supporting well-known development language and tools (unlike the hard core embedded programming required just a few years ago), thus further democratizing innovation and lowering the hurdles to experiment with new ideas.Rick Bullotta, Founder, Next Big Thing, LLC

On the cloud front, companies like Microsoft, Amazon, Saleforce, Philips, and GE are building IoT-specific services from which innovators can rapidly assemble IoT “apps”. Countless other Fortune 500 companies—including SAP, Cisco, Verizon, Bosch, Siemens, and PTC – have invested billions into building out the foundational capabilities for IoT innovation within their ecosystems.

Across the spectrum of IoT applications, a massive community of open source hardware (yes, there is such a thing), software, tools and libraries have been created to connect virtually anything to anything and to accelerate the time from idea to app by 10X-100X. This new approach to sharing of intellectual property has had profound effects in emerging areas as diverse as drones and 3D printers.

In the mobile device space, the Google Ara phone was one of the first attempts to create a printable package where modules could be selected from a marketplace and automatically integrate these modules into the customized device before shipping to the user. Despite Ara being shut down by Google, the direction was ahead of its time and may be a precursor of things to come for integrated products that contain hardware and software published by many different innovators.

Future IoT innovators will be able to select plug-and-play modules for sensing, control, image processing, power, communications, along with companion components in the software stack. These pluggable components will cut the R&D time by at least one order of magnitude, reduce or eliminate the oppressive certification requirements that add nothing but friction to innovation, and will lead to an almost unimaginable range of new products.

We are now seeing companies building a wide range of IoT “apps” to address areas such as healthcare, manufacturing, home and building automation, smart agriculture, intelligent transportation, and much more. The building blocks from which these apps are created will continue to grow and become more functionally rich, allowing app authors to focus on the unique vertical value-add and less on the plumbing and systems-level development.

While McKinsey estimates the total economic opportunity for IoT to be around $11.1 trillion annually by 2025, most companies are still struggling to create real innovations that drive significant business impact. Yet IoT is happening in pockets across the world from the garages of small innovators to the R&D labs of large companies. How can enterprises tap into this burgeoning opportunity?

1) Reimagine your business and identify emerging use cases for IoT
2) Create open innovation platforms like IoT hackathons around your high impact challenges
3) Invest in foundries and accelerators as external innovation platforms that allow start-up ventures to leverage your company’s resources, access, and reach
4) Cultivate new talent around IoT business models, hardware/software design and systems integration.

IoT is not inherently a new thing on its own. It is merely a way to integrate connectedness, ubiquitous computing power, and sensing/control into a new class of applications and products. The good news there is an army of innovators ready to help. By laying the foundation to integrate new IoT hardware and software modules into your legacy systems, you will be able to tap into this new wave of innovators from anywhere and will be one step closer to creating the next big app store for IoT.