One decade ago, no one would imagine the revolution in connectivity the world would experience in years to come. If in 1996 there were about 500 million devices connected to the Internet, today, there are 10 to 20 billion. The reason why? The amazing capabilities of our smartphones, which are so powerful today, as the main computer serving the US Government 50 years ago.
The magic beans that make our smartphones so incredibly intelligent are small sensors embedded in each device. Depending on the brand, a smartphone has in between five to nine sensors, but due to the falling price of sensors, in five years, there could be 40 to 50 sensors on each phone. Now, if one individual smartphone is so powerful, imagine its potential when they are all connected to each other!
The rise of connected and sensorised objects is enabling us to build an online digitization of our physical world. That is the power and potential of the Internet of Things. Are you ready to embrace the new age of data?
The Internet of Everything
In 2013 the Global Standards Initiative on Internet of Things (IoT-GSI) defined the Internet of Things (IoT) as “the infrastructure of the information society, or the “networked connection of physical objects”. If we extend the concept to the idea of objects also connected to people all communicating between each other, we have another even more powerful concept: the Internet of Everything (IoE).
Evans, on a white paper written for Cisco, defines The Internet of Everything (IoE) “as the networked connection of people, data, process and things”. The internet of things is therefore, one of many technology transitions that enable the IoE, alongside with cloud computing and other disruptive innovations.
Last year, 2015, was the year IoT gained legitimacy, as businesses began paying real attention to the IoT, by trying to come to terms on how to use its potential by developing future strategies and business models. Many companies’ interest in the IoT is manifested by its market share growth, that according to a study done by Verizon in 2016, is projected to move from $591 billion in 2014 to $1.3 trillion in 2019 with a compound annual growth rate of 17%.
The powerful characteristic at the core of the IoT and IoE is how the interconnection between objects and people, connected and communicating by sensors, can constantly acquire, transmit and analyze flows of data. It is not too difficult to imagine the potential and opportunities that this constant flow of data can have, for our economies, cities, businesses and people.
Examples of the practical uses of the IoT or IoE span from people communicating about the state of health of their internal organs, when swallowing a pill that can report about their digestive tract to the health centre, to farmers using bees that are connected to WiFi, that will help with the pollination process. Other examples are, in the industrial sector, autonomous machines and sensorized robotic equipment and in the business space, marketing analytics.
The data gathered by these and other examples, has an immense predictive potential. When raw data is analyzed by data scientists, using powerful computers, it will allow for more intelligent decision making in the future. Businesses and organizations of all kinds can take advantage from this data revolution, which is fostered by the IoE. Data can be used, for example, to preview inefficiencies or security holes in the supply chain, by informing marketers about customer behaviour, or by giving all kinds of businesses greater insight into its processes and products.
Plus, a data-driven world, where proper data analysis is put into place, is also a safer world, as it can figure out better ways to cope with inefficiencies, hassles, dangers, and unsafe practices in all kinds of sectors.
The global insurance industry will definitely play a vital role at the center of this technological revolution. Data is a key element of the insurance industry, because data enables insurance companies to understand and mitigate risks. No wonder that the insurance industry is paying extreme attention and producing valuable research about how big data and the IoE is impacting and changing our world. With their expertise resulting from years of accumulated knowledge on how to deal with data to assess risk, insurance companies are the best placed to help businesses navigate this new era.
Imaging our Drone and UASs-filled future cities
Another area where data promises to change our world, and our landscape forever, is in transportation, particularly aerial one. Can you imagine to wake up one day to see the sky of your city filled with all kinds of drones and Unmanned Aircraft Systems (UAS) swiftly passing by? This is not fiction anymore. All kinds of drones delivering packages, surveying the city and even transporting passengers across the city, will become a reality in the near future. In 2014, the Brazilian Air Force used four Israeli-made drones to help provide security during the Confederations Cup. In a recent report, forecasting aerial transport up to 2036 the FAA predicted that by 2020, 542,500 small Unmanned Aircraft would be part of their commercial fleet.
UASs hold great potential for business, and a good example is in agriculture. Drones and other unnamed aerial systems, can help farmers with tasks such as tracking the quantity and activity of cattle, irrigation of crops and monitoring crop health and maturity.The potential of UASs is, once more, data. Data gathered by UASs and its analysis can be used to assist in the creation of risk assessment surveys and enable more rapid response to disasters.
The insurance industry, is already leading this field, by using UASs to assess damage when catastrophes happen. In 2015, Typhoon Goni hit Japan bringing despair and damage to over 600,000 people, directly affected by the storm. AIG was able to rapidly deploy drone technology to assess properties affected by the storm, which allowed them to provide a fast and safe assessment of the damage.
There are hindrances from the past though that we need to be overcome to fully take advantage of UASs particularly in law. Policy makers need to keep up with the rapid development of novel technologies and quickly regulate for the benefit and safety of all, with an open mind.
Millennials, Data and the Sharing Economy
Millennials and the younger Generation Z, are the most important agents facilitating the new data age. Considered to be the first generation of digital natives, they are more independent and entrepreneurial than ever. Tech savvier then the previous generation, millennials have invented over the last decade new business models using the internet, such as the sharing economy, that were extremely successful.
In 2013, the World Economic Forum’s Young Global Leaders (made up with people with great achievements, aged under 40 years old) began a dialogue regarding the topic of sharing economy. The group considered issues like access versus ownership, and it looked at how the sharing economy creates new solutions to develop value and economic efficiency, as well as how to manage resources sustainably and build communities.
The sharing economy has developed rapidly over the past few years. We have seen (and used!) the massive and seemingly unstoppable growth of organisations like Airbnb and Uber which have changed their respective markets considerably.
Millennials are the crucial agents of the sharing economy. With their actions, they are redefining our relationship with ‘stuff.’ For millennials, ownership is not a necessity anymore, seen instead as an obstacle in care and maintenance. Privileging access to ownership, when traveling, millennials will rather use sharing economy apps to safely find accommodation, and a rental company to rent a car. As Rachel Botsman says, an expert on the sharing economy, “Technology is enabling millions of people around the world, to take a trust leap”.
AIG constantly investigates innovative technologies and applications, which allow new data-driven insights that can further improve safety and trust. Take the example of the rent a car industry. Recently, AIG partnered with Europcar Ireland for a pilot project that investigates if a “smoother” driver is a safer driver. In order to do so they built an online dashboard to allow their customers access real-time trip data and smooth driving scores.
Data, safety and trust
Data is definitely changing our lives, and the insurance industry, which pioneered the use of data analytics to bring safety and hope to our lives, certainly has a say on it. In Digital Destiny: How the New Age of Data Will Change the Way We Live, Work, and Communicate (2015), Shawn DuBravac, chief economist and senior director of research at the Consumer Electronics Association (CEA) writes how our world is about to change. He says:
“An all-digital lifestyle and the “Internet of Everything” are surreptitiously transforming the way we work, live, and communicate.”
Our digital destiny, as DuBravac calls it, promises not only to change our lives forever, but to finally solve some of the most pressing problems of humanity. Are we all ready to enter the era of post-scarcity, fostered by a world driven by data?
This article is the product of a partnership between Maria Fonseca and member companies of American International Group, Inc. (AIG). Although this post is sponsored, the information and opinions expressed in the article constitute only my own beliefs. This article does not suggest a partnership or affiliation between AIG and any other company referenced.