Good$a&ernoon.$Thank$you$very$much$for$invi5ng$me$here$today.$Today$I$want$to$delve$a$bit$into$the$Internet$of$Things,$which$has$been$the$subject$of$a$lot$of$discussion$as$a$major$focus$for$innova5on.$$I$will$start$by$describing$what$I$believe$the$Internet$of$Things$is,$then$I$will$talk$about$a$couple$of$concepts$that$challenge$the$vision$of$the$value$of$electronic$products$from$consumer$electronics,$which$assumes$that$the$value$of$digital$products$is$in$the$thing$you$can$hold$in$your$hand,$or$which$sits$on$the$oor,$and$which$you$buy$a$new$one$of$every$year.$I$think$thats$perspec5ve$gets$us$simplis5c$gadgets,$but$liBle$actual$innova5on$or$market$success,$and$that$the$true$changes$come$from$looking$at$the$ecosystem$of$devices,$services$and$business$models.$Ill$then$wrap$up$by$talking$about$where$I$see$some$opportuni5es$in$this$space$that$I$think$arent$geCng$enough$aBen5on.$

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Let me begin by telling you a bit about my background. Im a user experience designer. I was one of the first professional Web designers. This year I am celebrating professionally designing Web sites for 20 years. This is the navigation for a hot sauce shopping site I designed in the spring of 1994.

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Ive$also$worked$on$the$user$experience$design$of$a$lot$of$consumer$electronics$products$from$companies$youve$probably$heard$of.$

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Ive$wriBen$a$couple$of$books$based$on$my$experience$as$a$designer.$One$is$a$cookbook$of$user$research$methods,$and$the$second$describes$what$I$think$are$some$of$the$core$concerns$when$designing$networked$computa5onal$devices.$

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I$also$started$a$couple$of$companies.$The$rst,$Adap5ve$Path,$was$primarily$focused$on$the$web,$and$with$the$second$one,$ThingM,$I$got$deep$into$developing$hardware.$

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Today$I$work$for$PARC,$the$famous$research$lab,$as$a$principal$in$its$Innova5on$Services$group.$

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Let$me$step$back$and$say$a$few$words$about$PARC.$The$history$of$PARC$is$one$of$seeing$the$future$before$it$arrives$and$crea5ng$technologies$that$today$seem$obvious$but$at$the$5me$was$not$even$viewed$as$possible.$$In$the$1970s$and$80s$Xerox$PARC$invented$the$basic$ecosystem$of$networked$personal$computers.$In$the$1980s$and$90s$PARC$invented$the$basic$mul5media$ecosystem,$including$tablet$computers,$eink$displays,$networked$displays.$In$the$90s$and$2000s$we$split$o$from$Xerox$and$broadened$our$scope$to$include$development$in$a$number$of$technologies$that$are$unrelated$to$our$parent$companys$core$interests.$Some$of$the$hoBest$things$were$working$on$today$are$printed$electronics,$which$is$a$nonYsilicon$based$electronics$manufacturing$technology,$and$content$centered$networking,$which$completely$reimagines$the$infrastructure$of$the$internet$in$a$way$that$is$simpler,$more$secure$and$more$ecient$by$several$orders$of$magnitude.$$One$of$the$reasons$I$joined$PARC$was$because$under$one$roof$we$have$the$full$stack$of$technical$capabili5es$to$go$from$raw$silicon,$through$devices,$networking$stacks,$opera5ng$systems$all$the$way$through$big$data$high$performance$analy5cs.$

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The$group$that$I$work$for,$Innova5on$Services,$is$PARCs$consul5ng$arm.$We$consider$ourselves$to$be$a$bou5que,$high$quality$research$and$consul5ng$agency$with$a$unique$set$of$skills$for$helping$groups$gure$out$3Y5$year$strategy.$$We$use$user$experience$design,$ethnographic$research,$business$strategy,$innova5on$por^olio$management,$and$execu5ve$training$to$help$companies$reduce$the$risk$of$adop5ng$novel$technologies$and$increase$their$chances$of$compe55ve$success.$$Signicant$Japanese$presence$

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PARC$is$also$in$many$ways$where$the$Internet$of$Things$began.$In$the$late$1980s$Mark$Weiser,$who$was$then$the$CTO$of$PARC$predicted$that$just$as$mainframesone$computer$to$many$peoplegave$rise$to$personal$compu5ngone$computer$per$personthere$would$be$a$next$period,$which$he$called$ubiquitous$compu5ng,$that$would$happen$when$there$was$more$than$one$computer$per$person.$Thats$his$chart$from$20$years$ago$predic5ng$that$the$crossover$would$happen$around$2005,$which$was$basically$right.$I$never$knew$him$and$he$died$in$1999,$but$I$wish$he$was$around$today$to$give$his$thoughts$about$whats$going$on$today.$

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I$want$to$start$by$talking$about$Moores$Law,$since$thats$where$all$conversa5ons$about$the$implica5on$of$digital$technology$start.$When$people$talk$about$Moores$Law,$its$o&en$in$the$context$of$maximum$processing$power.$But$its$actually$something$dierent.$Its$actually$a$descrip5on$of$the$cost$of$processing$power.$Its$a$model$of$how$much$more$processing$power$we$can$t$into$a$single$chip$thats$priced$at$a$predictable$pricing$point$this$year$than$we$could$last$year.$This$means$that$its$not$just$that$processors$are$geCng$more$powerful,$its$that$PROCESSING$is$geCng$cheaper.$$For$example,$at$the$beginning$of$the$Internet$era$we$had$the$486$as$the$state$of$the$art$and$it$cost$$1500$in$todays$dollars.$Its$the$processor$that$the$Web$was$built$for$and$with.$Today,$you$can$buy$that$same$amount$of$processing$power$for$30$cents,$and$it$uses$only$a$frac5on$of$the$energy.$That$decrease$in$price$is$the$same$orders$of$magnitude$drop$as$the$increase$in$speed.$This$is$not$a$coincidence,$because$both$are$the$product$of$the$same$underlying$technological$changes.$$What$this$means$in$prac5ce$is$that$embedding$powerful$informa5on$processing$technology$into$anything$is$quickly$approaching$becoming$free.$

This$means$that$because$of$compe55ve$pressure,$anything$that$can$have$networked$informa5on$processing$embedded$in$it,$will.$Everyday$objects$will$make$sophis5cated$autonomous$decisions$and$act$using$arbitrary$informa5on.,$which$is$as$deep$an$infrastructural$change$in$our$world$as$electrica5on,$steam$power,$and$mechanical$prin5ng.$Maybe$its$as$big$of$a$deal$as$bricks.$

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The$other$dominant$trend$right$now$is$of$course$pervasive$data$communica5on.$This$is$an$image$from$Timo$Arnall$thats$envisioning$how$saturated$our$environment$is$with$networks,$and$its$not$even$coun5ng$the$mobile$phone$network.$This$means$that$virtually$any$device,$anywhere$can$share$data$with$the$cloud$at$any$5me.$This$means$it$can$ooad$func5onality$that$used$to$be$local$to$the$cloud,$which$means$that$almost$all$processing,$storage$and$most$baBery$life$issues$disappear.$If$your$5ny,$wimpy$device$can$talk$to$the$cloud,$it$can$be$eec5vely$as$powerful$as$the$most$powerful$computer$on$earth.$

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The$Internet$of$Things$is$a$really$challenging$name$to$work$with,$because$there$are$so$many$deni5ons.$$This$is$Time$Magazines$illustra5on$of$the$Internet$of$Things$for$their$$Best$Inven5ons$of$2008$edi5on.$I$love$this$illustra5on$is$because$it$makes$no$sense$no$maBer$how$you$think$about$it,$which$is$actually$quite$an$accurate$representa5on$of$how$confusing$the$many$deni5ons$of$the$Internet$of$Things$are$right$now.$

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The$rst$thing$to$note$is$that$there$are$two$deni5ons$of$the$Internet$of$Things,$which$causes$a$bit$of$confusion.$In$the$original$one$Kevin$Ashton$looked$at$how$RFIDs$could$aect$the$logis5cs$industry$and$saw$an$analogy$to$the$Internet.$RFIDs$could$be$like$the$packet$header$in$Internet$data$packets,$trucks$were$like$wires,$depots$like$routers,$warehouses$like$caches.$$Somewhere$around$2010$the$deni5on$slipped$and$rather$than$being$an$analogy$between$shipping$and$the$Internet,$it$came$to$mean$what$Mark$Weiser$had$earlier$described$as$ubiquitous$compu5ng,$which$means$that$everyday$objects$as$fullYedged$ci5zens$of$the$Internet.$Instead$of$being$LIKE$packets,$the$objects$now$send$packets$themselves.$$Whats$especially$confusing$is$that$since$so$many$of$the$new$objects$are$mobile,$the$rst$deni5on$ALSO$kind$of$applies.$When$youre$using$Waze$to$guide$you$around$trac,$its$trea5ng$your$car$like$a$data$packet$because$your$phone$has$made$your$car$into$a$networked$compu5ng$device.$

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Let$me$give$you$my$deni5on,$which$is$preBy$broad.$For$me$the$Internet$of$Things$is$the$combina5on$of$distributed$informa5on$processing,$pervasive$wireless$networking$and$automa5c$iden5ca5on,$deployed$inexpensively$and$widely.$The$underlying$technologies$and$the$applica5ons$that$are$tradi5onally$discussed$dont$maBer$much,$because$it$is$this$combina5on$of$factors$that$deeply$aects$people$and$industries,$and$it$does$it$by$connec5ng$peoples$immediate$experiences$to$the$power$of$digitally$aggregated$and$analyzed$informa5on.$In$other$words,$the$Internet$to$Things$turns$physical$ac5ons$into$knowledge$in$the$cloud$and$knowledge$in$the$cloud$into$physical$ac5on$in$a$way$thats$never$existed$before.$

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So,$for$example,$I$count$the$FedEx$Sensaware$smart$tag$and$the$YoBamark$tracking$system$to$be$roughly$iden5cal.$The$Sensaware$tag$has$a$bunch$of$sensors,$a$GPS$and$the$equivalent$of$a$phone$in$it.$Its$used$to$track$high$value$items,$such$as$human$organs,$that$need$to$be$shipped$under$precisely$maintained$condi5ons.$The$YoBamark$system$uses$s5ckers,$readers$and$a$wired$network$service$to$track$things$such$as$produce$and$car$parts.$Technologically$theres$almost$no$overlap,$but$they$both$give$people$the$ability$to$treat$physical$objects$fundamentally$dierently,$as$members$of$a$computa5onal$system.$They$bring$the$power$and$ideas$of$the$internet$to$physical$things.$

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The$implica5ons$of$this$technological$change$are$broad,$but$today$I$want$to$focus$on$three$aspects:$how$consumers$rela5onships$to$devices$change,$how$developers$rela5onships$to$their$tools$change,$and$how$companies$value$chains$change.$

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The$rst$thing$I$want$to$talk$about$is$how$peoples$rela5onship$to$their$devices$is$changing.$

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The core of this change is a shift from generic devices and software to specialized devices and software. When computing was expensive, you had general purpose devices and general purpose software that had deal with almost every situation. This necessitated design compromises that resulted in devices and software that could do almost everything, but did none of it well.!!Now that processing is so cheap, you can have a combination of 10, 20, or 30 computing devices and apps for the price of that one device, and you can acquire new functionality as needed. This means that every device and software package can have a narrower purpose.!

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The$second$trend$is$that$much$of$the$value$of$compu5ng$is$now$remote.$Today,$most$people$understand$that$the$experience$you$see$on$one$device$is$o&en$a$part$of$something$thats$distributed$throughout$the$world.$Theres$no$longer$a$need$to$pack$everything$into$a$single$piece$of$so&ware,$and$theres$no$expecta5on$that$everything$will$be$there.$$Foursquare$as$a$whole$doesnt$live$on$your$phone$in$any$meaningful$way,$and$people$know$that.$

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If we chart these two tends, two broad classes of digital products emerge.!$If$we$follow$the$local$to$remote$axis,$we$nd$generalYpurpose$devices$that$do$roughly$the$same$set$of$things,$and$dier$primarily$in$size.$They exist to provide access to online services, in a form factor thats appropriate to the context in which theyre used.!I$call$these$devices$terminals.!$If$we$follow$the$general$to$specic$axis,$we$see$a$shi&$is$to$more$narrowYfunc5on$devices$that$are$designed$to$do$a$small$set$of$things with specialized hardware. A parking meter can take quarters, which your phone cant do, and a digital SLR has a giant lens on it, which you probably dont want on your phone. These devices differ in their specialized hardware. I$call$these$devices$appliances.!

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The most interesting thing, however, to me is that these shifts are part of an even larger transition, one where devices are simultaneously specific AND deeply tied to online services. In this model, the service provides the majority of the value, and can be represented either as a dedicated appliance, an app running on a terminal, or anything in between. !!I call these devices service avatars. And this is where much of the Internet of Things currently lies, at least for consumer products.!

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As value shifts to services, the devices, software applications and websites used to access itits avatarsbecome secondary. A camera becomes a really good appliance for taking photos for Flickr, while a TV becomes a nice Flickr display that you dont have to log into every time, and a phone becomes a convenient way to take your Flickr pictures on the road.!!Hardware becomes simultaneously more specialized and devalued as users see through each device to the service it represents. The hardware exists to get better value out of the service.!

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Another$example$is$the$Kindle.$Heres$a$telling$older$ad$from$Amazon$for$the$Kindle.$Its$saying$Look,$use$whatever$device$you$want.$We$dont$care,$as$long$you$stay$loyal$to$our$service.$You$can$buy$our$specialized$devices,$but$you$dont$have$to.$

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At$rst$Withings$was$kind$of$a$gimmick.$You$can$tweet$your$weight$to$your$friends!$was$one$of$the$ways$it$was$originally$pitched.$Thats$of$course$not$par5cularly$interes5ng,$but$that$was$not$the$purpose$of$the$device.$The$scale$is$the$avatar$to$Withings$health$service$that$helps$you$track$your$weight.$The$scale$originally$dieren5ated$Withings$from$other$weight$tracking$apps,$but$the$value$is$not$in$the$scale,$but$in$the$service,$which$you$can$only$fully$experienced$using$other$avatars,$such$as$the$web$site$and$the$phone$and$tablet$apps.$$Withings$has$since$expanded$the$service$to$include$a$bunch$of$other$hardware$and$so&ware$avatars.$$Again,$the$value$is$not$in$the$devices,$but$in$the$knowledge$that$they$create$by$collec5ng$simple$pieces$of$informa5on$and$then$providing$users$with$the$full$power$of$cloudYbased$services$to$make$use$of$that$piece$of$informa5on.$Withings$can$keep$adding$avatars,$new$sensors$and$new$ways$to$display$the$informa5on$the$sensors$collect,$without$fundamentally$changing$the$promise$of$the$service.$$

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You$can$see$Googles$strategy$here,$too.$Each$of$these$things$may$be$presented$as$a$product,$but$really$each$is$an$avatar$of$whats$perhaps$going$to$be$the$same$service,$probably$some$kind$of$house$health$and$security$service.$

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Smart$Things$clearly$states$its$service$oering$right$up$front$on$their$site.$The$rst$thing$they$say$about$their$product$line$is$not$what$the$func5onality$is,$but$what$eect$their$service$will$achieve$for$their$customers.$Their$hardware$products$func5onality,$how$they$will$technically$sa5sfy$the$service$promise,$is$almost$an$a&erthought.$

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Compare$that$to$X10,$their$spiritual$predecessor$thats$been$in$the$business$for$more$than$20$years.$All$that$X10$tells$is$you$is$what$the$devices$are,$not$what$the$service$will$accomplish$for$you.$I$dont$even$know$if$there$IS$a$service.$Why$should$I$care$that$they$have$modules?$I$shouldnt,$and$I$dont.$

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The$next$major$shi&$I$want$to$talk$about$is$how$this$same$set$of$core$changes$is$changing$the$way$that$people$are$developing$devices.$

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Mark$Andreessen$said$that$so&ware$is$ea5ng$the$world.$But$the$web$is$ea5ng$so&ware,$which$means$that$the$Web$should$be$ea5ng$the$world,$which$it$is.$Specically$for$this$discussion,$its$ea5ng$hardware.$$There$used$to$be$a$clear$divide$between$the$methods,$tools$and$business$models$between$building$devices$and$crea5ng$the$so&ware$and$content$that$they$displayed,$but$thats$quickly$eroding.$What$were$seeing$in$its$place$is$a$new$approach$to$developing$experiences$that$is$rooted$in$Web$development$as$much$as$it$is$in$tradi5onal$electrical$and$computer$engineering.$

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Rather$than$devices$just$geCng$faster$and$cheaper,$theyre$also$geCng$easier.$Its$now$prac5cal$for$a$semiconductor$manufacturer$to$not$only$include$processing$on$a$chip$die,$but$to$include$a$bunch$of$other$func5ons$that$used$to$be$discrete$components:$audio$and$video$processing,$capaci5ve$sensing,$analog$to$digital$conversion,$USB,$etc.$Such$systems$on$a$chip$greatly$simplify$the$complexity$of$a$chip,$and$when$they$have$a$web$service$wrapped$around$them,$they$look$like$complete$computers,$rather$than$single$components.$This$means$that$a$device$is$now$a$small$network$of$WebYenabled$computers,$rather$than$a$bunch$of$discrete$components.$The$Raspberry$Pi$board$exists$because$all$of$its$func5ons$exists$on$a$SINGLE$Broadcom$chip.$These$are$the$stats$for$a$3$yearYold$Microchip$SOC,$which$is$probably$down$to$$1$in$quan5ty.$

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Whats$were$seeing$is$the$rise$of$object$oriented$hardware,$where$highYlevel$func5onality$is$encapsulated$in$small$devices$that$each$run$their$own$network$stack,$and$their$own$Web$server,$usually$through$node.js.$$Devices$such$as$Spark$Core,$Electric$Imp,$Marvells$Kinoma,$or$Intels$Edison$and$Gallileo$processors$are$not$just$a$new$genera5on$of$embedded$processors,$but$they$represent$a$radically$new$way$of$thinking$about$hardware$development.$Unless$youre$building$an$iPhone,$hardware$development$is$no$longer$about$op5mizing$for$every$processor$cycle,$every$milliamphour$of$baBery$life$or$every$byte$of$memory.$Its$not$about$debugging$with$an$oscilloscope.$These$devices$expose$their$func5onality$through$RESTFul$interfaces.$Theyre$programmed$typically$in$an$interpreted$language$like$Javascript,$using$cloudYbased$IDEs,$or$they$have$enough$power$that$they$run$their$own$IDEs.$This$is$the$5tle$slide$from$the$presenta5on$that$Andy$Carle,$head$of$UX$for$Kinoma,$gave$at$Sketching$in$Hardware$this$year,$where$he$described$their$system$for$doing$everything,$from$programming$devices$to$simula5ng$them$in$JavaScript.$$In$other$words,$its$much$closer$to$developing$for$the$Web$than$for$tradi5onal$hardware$

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and$in$fact$the$pla^orms$that$t$this$model,$which$are$appearing$at$the$rate$of$one$per$month$at$this$point,$are$directly$targe5ng$Web$developers$as$their$audience.$Theyre$saying$that$making$hardware$is$not$that$much$dierent$than$making$an$app.$Of$course$thats$not$true,$hardware$is$much,$much$harder,$but$thats$the$direc5on$things$are$moving$in.$

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Finally,$I$want$to$talk$about$the$change$in$the$business$strategy$that$all$of$this$entails.$

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Connec5ng$everyday$objects$to$the$cloud$isnt$interes5ng$in$itself.$Thats$why$the$nave$value$proposi5on$of$many$consumer$electronics$companies$is$o&en$so$laughable.$Any$reason$for$you$to$be$able$to$check$with$your$phone$whether$your$stove$is$on,$or$your$garage$door$is$open,$is$contrived$and$of$ter5ary$value$to$consumers,$at$best,$but$thats$what$were$geCng$a$lot$of.$

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I$think$that$the$biggest$change$is$that$once$you$can$uniquely$iden5fy$an$object$and$aBach$it$to$an$online$service,$you$can$fundamentally$change$the$ownership$model.$You$are$no$longer$selling$objects,$genera5ng$revenue$in$singleYunit$quan55es,$you$are$selling$services$that$the$physical$objects$are$avatars$of.$Companies$in$this$new$model$no$longer$sell$products$but$supply$services,$like$the$old$phone$company$used$to,$but$applied$to$everything.$

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Durable$objects$are$no$longer$owned,$but$rented.$For$example,$much$heavy$construc5on$equipment$is$not$owned$by$construc5on$companies,$but$rented$by$the$minute$thats$its$actually$running,$with$that$telemetry$collected$by$a$company$that$provides$the$construc5on$equipment$service.$If$a$piece$of$equipment$breaks$down,$the$company$is$immediately$no5ed$and$they$send$out$a$replacement$equipment.$Thats$part$of$the$service,$because$theyre$not$selling$a$digger,$but$the$service$of$digging.$The$same$model$is$rapidly$trickling$down$to$every$form$of$heavy$transporta5on$from$Zipcar$to$Scoot$to$bike$rental.$

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Consumables$become$services.$We$already$have$this$in$some$respect$with$Amazon$subscrip5ons$and$all$of$the$various$BirchboxYlike$subscrip5on$services,$but$what$happens$when$processing$becomes$cheap$enough$that$these$products$can$reorder$themselves?$Well$that$already$exists$for$inkjet$printer$ink$because$inkjet$printers$are$one$of$the$rst$common$Internet$of$Things$device.$Picture$this$service$mapped$to$everything$that$you$use$up.$Thats$coming.$

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Whether$theyre$focused$on$controlling$devices$or$crea5ng$a$service$out$of$devices,$I$think$all$of$the$business$models$in$this$space$will$depend$on$the$quality$of$their$analy5cs.$Under$the$Big$Data$umbrella$there$are$a$number$of$machine$learningYbased$analy5cal$approaches,$but$I$think$predic5ve$analy5cs$will$be$the$most$important.$Data$from$mul5ple$dierent$sources$will$be$used$to$an5cipate$the$future$state$of$a$system,$including$the$behavior$of$the$people$in$it$to$provide$value$for$the$subscribers$and$extract$value$for$the$system.$$Heres$a$recent$example$of$how$predic5ve$analy5cs$can$fuse$data$from$mul5ple$sources$to$create$novel$knowledge.$A$graduate$student$was$able$to$fuse$three$data$sources:$a$list$of$a$vehicles$speed$at$various$5mes,$a$map$that$had$typical$speeds$on$roads,$and$the$vehicles$star5ng$loca5on,$to$predict$the$loca5on$of$the$vehicle$to$within$a$1/3$of$a$mile$radius.$This$is$without$a$GPS$at$all,$just$pulling$the$data$o$of$the$speedometer.$Crea5ng$an5cipatory$behaviors$based$on$a$predic5ve$model$is$of$course$the$value$proposi5on$of$Googles$Nest$thermostat,$of$Waze$and$of$the$Canary$home$security$system.$$For$me,$the$greatest$innova5on$in$this$space$will$not$come$from$simply$connec5ng$things$to$the$internet,$surfacing$their$func5ons$as$APIs,$or$having$them$talk$to$each$other.$Thats$preBy$much$a$solved$problem.$The$greatest$innova5on$here$will$come$from$taking$the$data$that$such$systems$collect,$and$the$behaviors$that$they$can$express,$and$fusing$them$with$predic5ve$analy5cs$to$create$new$services$that$an5cipate$the$behavior$of$people$and$machines$to$make$experiences$more$ecient,$more$entraining,$and$less$frustra5ng.$In$other$words,$to$make$the$objects$in$the$$

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Of$course$the$downsides$of$this$kind$of$centralized$predic5on$are$clear.$Bruce$Sterlings$recent$essay,$which$is$what$this$quote$is$taken$from,$vividly$describes$his$concern$that$too$much$of$the$informa5on$collected$by$these$devices$is$being$stored$by$a$small$number$of$companies,$specically$Apple,$Google,$Facebook,$Amazon$and$Microso&.$His$very$legi5mate$concern$is$that$these$companies$do$not$have$the$best$interests$of$their$customers$in$mind$outside$of$their$status$as$subscribers.$For$us$as$consumers,$we$really$have$to$think$about$how$much$convenience$these$services$provide$rela5ve$to$the$personal$informa5on$that$you$provide$them.$I$recently$returned$a$car$analy5cs$dongle$that$plugged$into$my$cars$data$port$and$connected$my$car$to$a$cloudYbased$service$because$I$realized$that$it$provided$me$with$very$liBle$valuable$informa5on,$and$yet$at$the$same$5me$I$was$giving$it$my$cars$loca5on$in$one$minute$increments.$That$seemed$like$an$astoundingly$lopsided$dealin$exchange$for$my$loca5on$every$minute$all$it$did$was$tell$me$that$my$drive$to$work$cost$me$$4.82YYso$I$turned$it$o$and$sent$it$back.$Thats$why$I$dont$have$a$Nest$thermostat,$either.$Un5l$it$can$oer$me$something$other$than$a$vague$promise$of$some$savings$on$my$u5lity$bill,$I$do$not$consider$it$a$worthwhile$trade$for$it$to$know$my$daily$rou5ne.$$As$service$designers,$we$have$to$be$very$cognizant$of$crea5ng$services$that$are$not$just$surveillance$tools$with$a$thin$veneer$of$func5onality.$I$think$thats$neither$ethical$nor$is$it$a$sustainable$business$model.$

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Id$like$to$nish$by$men5oning$three$areas$where$I$think$there$are$par5cularly$interes5ng$business$and$technological$opportuni5es$in$the$Internet$of$Things$space.$

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Almost$all$of$the$avatars$that$currently$exist$are$superYthin.$Theyre$basic$sensors$with$the$thinnest$possible$layer$of$networking$and$processing$around$them.$This$makes$them$cheap$and$disposable,$so$you$can$iterate$on$their$design$quickly$and$minimize$the$perYunit$cost$to$lower$the$barrier$to$purchase,$thus$being$able$to$compete$with$nonYhardware$solu5ons.$Thats$great,$but$what$are$the$situa5ons$where$you$can$get$signicant$advantage$by$introducing$computa5on$at$the$edge?$Instead$of$sending$back$a$stream$of$raw$data$thats$processed$in$the$cloud,$then$wai5ng$for$a$response,$for$certain$behaviors$you$can$act$immediately,$or$reduce$the$amount$of$transmiBed$informa5on$by$orders$of$magnitude.$The$challenge$here$is$iden5fying$applica5ons$that$exist$in$an$inYbetween$state$between$situa5ons$where$the$value$is$exclusively$local$and$the$those$where$value$is$exclusively$created$by$the$service.$Brian$David$Johnson$of$Intel$wrote$about$TVs$that$do$face$recogni5on$on$every$frame$to$iden5fy$what$actors$are$in$what$scenes,$independent$of$where$that$data$stream$is$coming$from.$That$sounds$interes5ng,$and$heres$a$Raspberry$Pi$implementa5on$of$just$that$idea,$but$Im$not$sure$of$the$business$model.$Having$local$computa5on$also$makes$the$hardware$way$more$expensive$in$terms$of$cost$and$baBery$usage,$but$I$think$its$a$rich$area$for$explora5on.$

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The$company$that$solves$the$problem$of$service$discovery$will$be$the$Google$of$the$IoT$space.$The$lack$of$decent$service$discovery$has$plagued$the$ubicomp/M2M/IoT$space$for$DECADES.$How$can$I$iden5fy$what$devices$do$what$and$then$automa5cally$talk$to$them.$And$its$not$for$a$want$of$trying.$There$are$a$million$solu5ons$and$not$a$single$one$thats$as$easy,$open$and$agendaYfree$as$HTML$was.$Im$a$big$fan$of$two$approaches:$one$is$named$data$networking,$which$PARC$is$working$on.$Think$of$it$as$a$mix$of$BiBorrent$and$DNS$that$throws$out$most$of$the$assump5ons$of$TCP/IP,$but$its$a$longYterm$bet,$so$I$think$theres$a$lot$of$opportunity$to$do$something$sooner.$One$other$solu5on$is$trea5ng$every$device$like$a$Web$site.$This$is$EVRYTHNGs$Web$of$Things$approach.$You$just$dont$dieren5ate$between$talking$to$a$key$fob,$talking$to$an$oil$rig$and$talking$to$Pinterest.$Everyone$uses$the$same$protocols$and$you$just$teach$Web$discovery$methods$$

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Internet$of$Things$hype$is$in$the$consumer$space,$but$I$think$theres$a$huge$value$proposi5on$is$in$conver5ng$the$physical$networks$of$things$that$businesses$own$to$digital$networks.$There$are$a$huge$number$of$businesses$that$have$collec5ons$of$devices$and$processes$that$are$essen5ally$physical$networks:$all$of$the$machinery$and$process$a$farmer$has$when$growing$cucumbers;$the$washing$machines$at$a$laundry$facility,$the$complex$logis5cal$chain$that$a$coee$roastery$par5cipates$in.$This$doesnt$have$to$have$the$magnitude$of$GEs$Industrial$Internet$vision,$where$theyre$collec5ng$terabytes$of$data$per$hour$from$a$distributed$sensor$net$on$an$oil$rig.$It$can$be$much$smaller$and$can,$say,$use$predic5ve$analy5cs$to$tell$a$delivery$company$when$a$car$needs$maintenance$before$it$actually$breaks$down,$or$it$can$give$the$owner$of$a$sewing$company$realY5me$data$about$machine$u5liza5on$so$they$can$decide$how$many$people$they$need$to$bring$in$tomorrow.$$[I$poohYpoohed$the$internet$connected$stove,$but$this$is$where$that$model$actually$makes$sense.$Especially$in$businessYcri5cal$or$lifeYcri5cal$situa5ons,$connec5ng$and$monitoring$device$status$and$health$can$be$hugely$valuable.$People$talk$about$predic5ve$maintenance$as$one$are$where$this$is$especially$valuable,$and$maybe$thats$the$case,$but$I$think$just$knowing$whats$happening$where$when$so$that$the$system$as$a$whole$can$be$tweaked$can$be$very$protable.]$

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To$me$why$we$make$Internet$of$Things$is$not$about$the$things,$its$not$about$crea5ng$new$gadgets,$but$developing$services.$Our$biggest$challenge$as$innovators,$designers,$developers$and$entrepreneurs$will$not$be$adding$cheap$electronics$to$everyday$objects.$Thats$a$solved$problem.$Our$challenge$will$be$to$understand$how$to$use$those$things$to$create$value,$and$to$create$sustained$and$sustainable$change,$in$a$world$where$there$is$an$enormous$amount$of$poten5al$for$embedded,$networked$technology,$and$an$enormous$number$of$paper$thin,$one$note$gadgets.$I$once$heard$an$industrial$designer$say$that$everything$you$design$is$garbage$from$the$minute$it$comes$o$the$assembly$line,$and$that$its$your$responsibility$to$keep$it$out$of$the$trash$bin$for$as$long$as$possible.$I$think$that$in$the$internet$of$things$that$is$especially$true$and$today$I$think$that$our$biggest$challenge$as$innovators$and$facilitators$of$innova5on$will$be$to$think$about$why$we$want$to$make$things$at$all,$and$then$how$we$can$make$them$provide$the$most$value,$for$the$least$cost,$for$the$most$people,$for$the$longest$5me.$

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Thank$you.$

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