The New World of The Economy of Things

The title of this post might sound quite similar to the term Internet of Things. Are they related? Of course. That means we should be starting by defining and understanding what the Internet of Things (aka IoT) is and how it has changed our daily lives.

The definition: An autonomous collection of devices that utilize web technologies to talk to each other and send information that is gathered from sensors. The “things” defined in the name are usually low-power and internet-connected devices.

What does IoT improve?

The main idea is to collect data about the environment of the device and understand the state of what is being monitored. An example could be manufacturing processes. Some of the questions you would like answers to could be the following:

• What’s the temperature of the production floor? Does it affect my outcome?
• What is the vibration of the drill head on the CNC machine? Could it be damaged? Would this produce an improper batch of products?
• Is the air quality good on the production floor? Can this have an effect on the employees working their shifts? Health and also the cognitive ability to function are of concern.
• What is the current output rate for a specific product?

These are some of the questions that can be asked. There are tons of them that could be answered using many “things”. This could help you build a more efficient process and identify where your current system may be lacking, then you start taking action and keep improving. It will allow you much faster analysis as you can gain real-time access to the operations going on. You can even add more parameters to your process using sensors to gain even more insight.

The goal is to gain an understanding of a system that would didn’t get or would manually have to collect. With IoT devices, this because much more automated and also allows storage of data that if you ever need to go back to a point in time that you may have thought it wasn’t important to record.

How do we create value from these data points and insights?

This is where we can start defining what the Economy of Things is. Using IoT devices we are constantly gathering data autonomously using onboard storage or sending it upstream to a server living somewhere in the world. Data just sits there for the people who need to analyze it in the company that deployed it. The next question would be can we use it across these IoT systems so different systems can talk to each other or maybe inside the system itself?

The Economy of Things covers this aspect of technology. The value of the data across different systems to be able to exchange them for some sort of other valuable property. Let’s visualize this in our heads by setting up the scene.

We are at an intersection in New York City. You look around and see traffic lights, cars passing by, yellow cabs, ride-sharing cars/bikes/scooters, cafes, and stores located along the sidewalks. The poles holding up the traffic lights also have mini weather stations recording data. Finally, everyone around you has their personal smartphones, smartwatches, etc.

Where can we find these IoT devices in this scene? This can be a possible list:

• Traffic lights – monitoring traffic and changing the state of lights depending on where cars and pedestrians start building up.
• Cafes – payment systems, or indoor air quality devices
• Everyone around you with smartphones/watches
• Buildings – security systems, air quality measurements, access control devices such as smart locks
• Cars – navigation systems on them, any control unit that you have in the car
• Ride-sharing vehicles – scooters monitoring charge levels, reporting your location through GPS
• Weather stations – sending data to a centralized system that provides you with information in real-time about your location

This is the list I can come up with currently. Maybe there are even more devices that are out there I’m not aware of! All of these devices are collecting data that they are responsible for being analyzed in the future or in real-time in the company office. The Economy of Things will allow these systems to start interacting with each other. On the edge (the term used for devices that are collecting the data somewhere reporting upstream), There can be more processing done with machine learning or AI models. As these embedded devices get more and more powerful for their footprint, the amount of computation we can do on them can be increased.

AI models are a key I believe in the economy of things as you can use different data to train a model. Let’s go back to our scenario. Let’s try to predict how long we can change the red light state to be relative to the green light during rainy or snowy weather. We can try to correlate this to the amount of ride-sharing vehicles during different weather conditions using the mini weather stations, and the scooters on the road reporting their location. This way you can predict the future in certain conditions where pedestrians could be fewer and there might be fewer ride-sharing vehicles outside. The duration of the red light can decrease and iteration through the states could be much faster providing a better flow of traffic. This is a very high-level guess and idea but you can see how these different data sources can feed the traffic light to estimate what it should be doing.

The weather stations would provide the current weather, ride-sharing devices can report if they are idle or on the street, and the devices in a cafe can report the number of people inside estimating how many people might end up using the intersection to cross at some point in time. Since we can distribute these “responsibilities” across IoT devices, any company can reduce the cost of their devices by taking a unit off their own device and utilizing the ones in the field by requesting data from that device.

The Economy of Things is a world where not just digitization of the physical world happens, but as we transition to this new variant of technology there will also be monetization of these devices providing valuable data.