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The internet of things: overcoming obstacles

June 02, 2:49 UTC+3
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KEY CONCLUSIONS:

  • The internet has a major impact on the global economy

“The Internet of Things will create added value of USD 11 trillion for the economy. In 10 years, this technology can create another China in terms of economic benefits or economic contributions to the GDP <…> Two thirds of the Internet of Things market will be accounted for by the commercial rather than consumer market. We see the most added value in mining and production,” said Vladimir Cernavskis, Head of Telecom, Media and Technology Practice in Russia, McKinsey & Company.

“The use of smart street lighting saves up to 40% of power costs. There are also smart dumpsters, smart sensors and other examples,” said Andrey Kuzyaev, President, Chairman of the Management Board, Member of the Board of Directors, ER-Telecom Holding.

“From the point of view of an online retailer, it is important to connect every toothpick and know exactly where it is,” said Dmitry Kostygin, Сhairman of the Board of Directors, Ulmart.

“Now we have 9.7–9.8 billion devices out in the market, connected devices, smart devices, which have IoT functionality. <…> By 2020, it will cross 20–25 billion devices out there,” said Irmgard Glasmacher, Managing Director – Accenture Strategy, Middle East, Africa, Russia and Turkey.

“Five to seven years ago, getting information from one sensor cost USD 100–150, sometimes up to USD 1,000. Today, it is USD 2–4. The costs are decreasing sharply,” said Andrey Kuzyaev.

CHALLENGES:

  • Cyber security issues

“There are obstacles in terms of data security, potential breaches of data privacy, the obstacles in terms of being attacked, cyber attacks and so on” <…> We could count <…> about 295 incidents of breaching, cyber attacks and so on,” said Irmgard Glasmacher.

  • Consumers’ poor awareness

“There are many companies that have no idea of the consequences that there may be if a person provides their personal data. <…> As a user of a system, I transfer my data to it and cannot control them any more,” said Sven Wagenknecht, Editor-in-Chief, BTC-ECHO Bitcoin & Blockchain News.

  • Unfulfilled potential

“Of all the barriers – technical, organisational and commercial – we single out interoperability, the ability of the devices to actually truly connect and then share, as the largest one. <…> About 40% of the huge number I have mentioned, of USD 11 trillion, <…> can only be captured if the barriers of interoperability, compatibility can be solved,” said Vladimir Cernavskis.

“There are many sensors for industrial facilities, but the problem is that today we do not use this information. For example, only 1% of information from 30,000 sensors is analysed. We need to learn to use the information with the help of Big Data and other technologies. Customers themselves do not use the information, hackers are interested in it even less,” said Vladimir Cernavskis.

  • Regulatory challenges

“When we talk about data flows, we mean millions of transactions, that is a huge amount of information. Centralised control is simply impossible here, which makes us devise economic, ethical, and technology concepts to enable us to handle this data flow. At this point, we are talking about artificial intelligence and all technology innovations. Here, it is essential to be creating framework conditions while maintaining a dialogue with each other,” said Sven Wagenknecht.

“There is a risk that by excessive regulation the government can run the process down so we will never enjoy the Internet of Things in our country. Let us seek balance between security and progress. We need a sensible degree of freedom here,” said Andrey Kuzyaev.

SOLUTIONS:

  • Following the market and developing skills

“There is a real opportunity to develop the Internet of Things, there is credit worthy demand. Obviously, we can use various strategies. We can wait for a verified standard to appear, or we can use the strategy of applying various technologies depending on the customer demands. We are not going to be waiting, we will be among those who will arrive at the Internet of Things first,” said Andrey Kuzyaev.

 “We should start with secondary schools and teach school students to use the new technologies in a secure manner,” stressed Sven Wagenknecht.

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