T

he Internet of Things (IoT) is a new concept in the world of information and communications technology and has only recently dawned on Indonesian consumers.

It is a new market proposition that has amassed curiosity and excitement among consumers and a breath of new opportunity among technology vendors grappling to re-invent themselves in an increasingly commoditized world.

The IoT already impacts on our everyday life down to the smallest of details, and International Data Corporation (IDC) Indonesia defines it as a concept of network connecting (either wired or wireless) devices, or '€œthings'€, characterized by autonomous provisioning, management and monitoring. In other words, the IoT is almost anything and everything connected to a network that functions in '€œreal-time'€.

Globally, IDC sees the IoT is already having an impact in modern cultures. From '€œsmart city'€ concepts, to '€œintelligent monitoring'€ systems, IoT is being utilized across everyday consumers to industries to provide real-time analytics and intelligence to those who are monitoring them, but at the same time, it provides the consumer with real-time information to enhance one'€™s everyday life.

Due to the inclusion of almost everything connected to a device being part of the IoT '€” and these days, there is almost no individual that is '€œnot track-able'€ due to connectivity via a cell phone '€” IDC estimates that the IoT market size globally will achieve US$8.9 trillion by 2020, enabling more than 200 billion devices and connecting 30 billion autonomous '€œthings'€.

The momentum for IoT is driven by several factors and as it begins slowly creeping into Indonesia, continuous demand from consumers for a more self-serving, autonomous and convenient culture is definitely one of them. With ongoing discussions about creating a '€œsmart'€ or '€œconnected'€ city in the near future, the notion of the IoT becomes all the more relevant.

Globally, IDC has witnessed a drive for a connected culture, where individuals have a high affinity for full-time connectivity, which makes consumer IoT a compelling proposition. At the same time, as governments continue to drive the development of '€œsmart cities'€, and/or property developers start introducing things such as '€œsmart houses'€ and car manufacturers propose '€œsmart cars'€, the need and want to be connected within your own ecosystem stands to be a standard of its own in the near future.

However, as with any good new concept, challenges await. In Indonesia'€™s case, connectivity infrastructure remains a critical issue, and the need to repurpose legacy networks and increase the ubiquity of connectivity across the archipelago remains by far the largest challenge for Indonesia.

While IDC acknowledges the efforts put forth by telecom providers in enhancing and modernizing their networks, at present, the ecosystem remains nascent, and the simplistic adoption of the Internet will take the fore in most islands and cities outside Jakarta.

Smartphone penetration in the country is reported to be slightly above 20 percent, and total shipments of smart phones based on IDC'€™s estimates by the end of 2014 total 25 million. As tablets ramp up their entry point into the market (estimated to achieve 4 million units shipped by the end of 2014), 3G network connectivity is more in demand than ever.

Looking at existing statistics, our counterparts in Europe and the US have already begun to ramp up the use of IoT within their daily lives and workplace. IDC'€™s data has shown that European organizations, for instance, reported one in five of companies having already fully implemented IoT solutions within their enterprises '€” ranging from connected cars, smart utility grids and anything else '€œsmart'€ within their ecosystems. One in three organizations are piloting the technology, while one in four are keenly evaluating the proposition it can bring to the business.

Indonesian organizations, on the other hand, are just coming around to the idea of what IDC dubs the '€œthird platform'€, and looking at ways of harnessing and maximizing the potential of cloud, social, big data and enterprise mobility.

However, the good news for a country like Indonesia is that IDC'€™s global findings have indeed shown that the rate of investment into a country is not necessarily driven by IoT adoption, but connectivity plays an integral role in influencing a set-up decision.

IDC'€™s data has clearly shown that speed to market, whether in the enterprise or consumer space, plays a critical role in garnering customers. So when addressing the notion of IoT, it'€™s critical to look at how speed can enhance business agility for businesses, and how it can fulfill instant gratification among consumers '€” therefore making this a critical consideration of business activity in the next five years.