January 6, 2015
Last night, Samsung CEO and president BK Yoon took the opportunity in his opening keynote at the 2015 International Consumer Electronics Show (CES) to focus on the Internet of Things (IoT) – what it is, where we are now, and what we should be expecting in the future. Reportedly much tamer than previous CES keynotes, Yoon focused his talk during CES 2015 on how the Internet of Things will play significant roles in our lives. While some found the talk to be wholly expected and not at all enlightening, those critics seem to miss the most important point from the keynote talk: Samsung is committed to creating connected devices, which should lead us to believe that, in a few years, nearly every American household will have at least one smart device from the company – something that other current competitors in the IoT space cannot come close to achieving.
What is the “Internet of Things”?
While the term “Internet of Things” has been used fairly frequently in the past two years, recent research conducted by Ipsos MORI and released by TRUSTe revealed that an overwhelming majority – 87 percent – of American consumers are unaware of what “Internet of Things” actually means or to what it refers. To put it simply: it’s a term that describes a general concept; the term describes the connectivity of different everyday objects to both the Internet and to other everyday objects through various sensors. The idea, or end-goal, is to achieve seamless connectivity between the many different objects used in your everyday lives, giving you the functionality to, say, automatically turn on the fireplace in your living room if and only when the temperature outside hits a certain level and you’re on the couch in the living room.
What Samsung’s CEO said at CES:
At last night’s keynote, Yoon made it clear that Samsung’s doing whatever it can to make the ideals of IoT a reality; Yoon announced yesterday that by 2017, 90 percent of Samsung’s products will be optimized for the world of the Internet of Things, with the eventual goal of all Samsung hardware to be designed for interconnectivity. “It’s not science fiction anymore – it’s science fact,” said Yoon. “We are bringing the physical and digital world together…[and] will revolutionize our lives.” According to Yoon, the company will invest more than $100 million in accelerator programs to encourage developers to create newer and better IoT technologies. Further, he called for openness on the part of other companies, to allow for collaboration and true interconnectivity between the real-world objects. After Yoon’s talk, Alex Hawkinson, the CEO of SmartThings (which Samsung acquired last August) announced the release of a new hub supporting Bluetooth Smart, which would allow even more devices to connect with the SmartThings smart home platform.
Why this is important, and what it means for Samsung:
Sure, most of what Yoon said in his keynote wasn’t groundbreaking. For those already in-tune with the tech world, it comes to no surprise that the Internet of Things will eventually (soon) play a significant role in our everyday lives. I mean, it was only a few years ago that smartphones were introduced into the consumer market, and since then the majority of adults have adopted their use; from 2011 to the beginning of January 2014, Pew reports that smartphone ownership in the United States jumped from 35 percent to 56 percent. Indeed, even prior to CES, publications were already anticipating IoT to become a major theme this year. So, yes, Yoon’s message regarding IoT was trite; however, to hear such a message from the CEO of a multibillion-dollar, global corporation makes it particularly important.
Samsung is a $211 billion global technology corporation, with the resources to not only make large acquisitions (such as in the case of SmartThings) and make investments in the development of new IoT technologies, but also with the global renown and market through which to spread its products. And that should be the key takeaway from such an announcement. Through his announcement, Yoon has essentially told the tech world that it is leading the Internet of Things movement – doing whatever it can to ensure that the world in which we live five or ten years from now will be influenced largely through Samsung’s innovations. The announcement tells the tech world: whether you’re a startup or an innovator doing something in the Internet of Things space, Samsung is here to 1) acquire you or 2) give you the resources to support you in your endeavors.
2. Consumer Use
There are certainly many, many startups trying to accomplish things in the Internet of Things space, with many more expected to enter (especially after the outcome of this year’s CES). And, I mean, there are plenty of reasons for people to get involved. According to a 2014 survey conducted by the Acquity Group, 69 percent of consumers plan to buy an in-home Internet of Things device within the next five years – that’s a huge opportunity for any company. This growing consumer sentiment towards IoT devices and their growing uses only encourages the future involvement of developers and entrepreneurs in this field. To have a major corporation share a message of support for such technologies can only further the move into IoT and could even potentially accelerate the adoption rate of such smart devices among consumers. I’m not even including the potentially sizable economic contributions – which, considering the U.S.’s focus on finding new pathways for our workforce, could become a primary motivator for encouraging entry into the IoT space.
The major implication from Yoon’s speech (and the one for which companies like Google and Apple should be concerned): expect the majority of households to have at least one kind of IoT device within the next few years. If Samsung is truly committed to the Internet of Things movement, then expect them to dominate a market that’s expected to play a significant role our global society.
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