The internet of things: Britain's next big opportunity

Tech City's Gerard Grech talks about the IoT phenomenon and a startup competition that is intended to accelerate technologies

When you hear the term “the internet of things”, what immediately comes to mind? If you’ve been following recent stories in the media, you might have it pegged as the Big Thing to revolutionise all our lives any minute now. Equally, you might be forgiven for thinking it's a lot of hype generated by overexcited tech types and inflated billion-dollar deals. 

The truth, as ever, lies somewhere in the middle. The combination of connected products, together with intelligent data analysis, has the potential to transform the way we produce goods, run machinery, manage our cities and improve our lives.

The internet of things is a real phenomenon and will take off in much the same way as the worldwide web did back in the 1990s. 

And, just like the web, the full deployment of IoT across industries will take time, talent and persistence. The question is not whether it is going to happen, but what part the UK will play in it all.

A beguiling vision

Consumers stand to benefit from electricity meters that talk to the grid to get the best deals, and health monitors that provide minute-by-minute data on people’s heart rates. With Google’s acquisition of Nest Labs and Samsung’s recent purchase of SmartThings, we will soon have access to a suite of clever gadgets that will create our future “smart” home.

It’s a beguiling vision, albeit one with alarm bells (privacy and security obviously need resolving). But the real power of the internet of things lies beyond eye-catching consumer goods. IoT will probably play a bigger role in business-to-business applications than in the consumer market. This technology will truly come into its own when adopted by the heavyweight industries that stand to gain most from transmitting data wirelessly.

Connected industries

Aerospace and automotive manufacturing, pharmaceutical and chemical production, transportation logistics, oil and gas processing are just some of the industries that are already boosting their operations by tagging wireless devices to things and people.

Clearly, the opportunities for cost-saving and return on investment are enormous – which is why it is so transformative. Research analyst Gartner predicts that by 2020, nearly 26 billion physical devices will be transmitting data to each other via the internet. IDC forecasts that the IoT market will be worth $7.1trn in 2020 as businesses and consumers adopt smart technology for homes, cars and a variety of accessories.

While there is genuine excitement about IoT within the business-to-business community, the perceived lack of leadership or innovation among many British businesses beyond the role of the CIO (chief innovation or information officer) could present a problem. 

I see too few British companies including IoT horizontal technologies in their external products and services or applying them to critical internal operations, such as product development. According to The Economist Intelligence Unit, since 2012 only about 30% of organisations have seen double-digit growth in IoT investment. 

This game-changing development needs the full attention of CEOs and boards. With its strong heritage in software, engineering and hardware development, the UK is perfectly placed to take advantage of the IoT opportunity.

That is why this summer, Tech City UK, Cambridge Wireless and the UK’s innovation agency, the Technology Strategy Board,  a £1m Launchpad competition for startups and SMEs in London and Cambridge to help accelerate development in this space.

Crucially, it is backed by major brands including EE, Cisco, Unilever, Bosch, Seedcamp and John Lewis, all of which have committed potential fund matching, marketing support, retail space and mentorship to the competition winners. This commitment signals a shift in the value the private sector places on connected technologies.

Better together: IoT clusters

Our hope is that the internet of things Launchpad will drive collaboration between the London and Cambridge clusters, seeding the foundations for a critical mass of expertise in IoT. The vision is to pool Cambridge’s expertise in hardware and network connectivity with London’s design heritage and application development, while tapping into the rest of the country’s relevant IoT expertise, such as Artificial Intelligence in Edinburgh and media. And there are promising signs already.

In London, Clerkenwell-based Evrything, an IoT data enabler, recently received £7m in funding from Cisco. Meanwhile, BleepBleeps, maker of a host of connected gadgets to help make parenting easier, is part of an emerging hardware collective of startups in east London, pushing the boundaries of where hardware meets software.

Cambridge-based startup Neul is working with BT to pilot a sensor network in Milton Keynes from next month, experimenting with, among other things, rubbish bins that send messages to collection trucks when they are overflowing, and car parks that signal vacant spaces to drivers. And, also Cambridge-based, is leading the way in assisting the practical deployment of wireless IoT solutions on an industrial scale. 

The competition is the natural follow-up to the government’s £45m investment in a nationwide internet of things infrastructure. In his speech at CeBIT in March, David Cameron hailed IoT as “a huge transformative development, a way of boosting productivity, of keeping us healthier, making transport more efficient, reducing energy needs, and tackling climate change”.

The conditions are right for the UK to take the lead in a technology that may prove to be the next electricity.

The competition closes on 3 September. Information can be found here.

Gerard Grech is CEO of Tech City UK, a government body that was set up in 2010 and acts as a mediator to provide responsive feedback between government and the tech community.

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