Cisco CEO at CES 2014: Internet of Things is a $19 trillion opportunity

Ethan Miller/Getty Images - LAS VEGAS, NV - JANUARY 07: Comedian/actress Sarah Silverman (L) joins Cisco Systems Inc. Chairman and CEO John Chambers as he delivers a keynote address at the 2014 International CES at The Venetian Las Vegas on January 7, 2014 in Las Vegas, Nevada. CES, the world's largest annual consumer technology trade show, runs through January 10 and is expected to feature 3,200 exhibitors showing off their latest products and services to about 150,000 attendees.

In a recent keynote speech, Cisco chief executive John Chambers predicted the Internet of Things would be a $19 trillion market over the next several years.

Addressing an audience of tech enthusiasts at CES 2014 in Las Vegas, Chambers explained that IoT — a term for connected sensors, devices and objects — could create new opportunities for revenue generation and savings, including $4.6 trillion in the global public sector.

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Other estimates aren’t far off: A 2013 McKinsey report estimated various IoT applications could have an economic impact of between $14 trillion and $33 trillion a year by 2025. Gartner estimated a total economic impact of $1.9 trillion by 2020.

Cisco, which took in $12.1 billion in revenue last quarter, has been trying to establish itself as a network provider enabling the IoT. In May, it acquired energy data management company JouleX, and October it created a new Internet of Things division, for instance.

“It’s going to be a new kind of IT. It’s going to first of all have to be very simple to use,” Chambers said. Instead of offering new services that take months or years to develop, IT companies should prioritize services customers can deploy in a week, he added.

At a virtual roundtable discussion Cisco organized on Wednesday, a few of the company’s public sector customers explained how they use IoT to collect data on make operations more efficient.

The Smithsonian Institution’s chief information officer, Deron Burba, explained how its museums are offering higher-tech resources to patrons, supported by Cisco’s network — wireless access in museums, 3D diagrams of historical artifacts online, and a mobile app called Leafsnap that can identify leaf species through photographs.

“We’re changing the way we interact with people,” Burba said, noting that analytics from these resources — the locations at which users submit leaf photos to Leafsnap, or data about Wifi use in museums — can help the Institution better understand what patrons are interested in.

Manel Sanroma, chief information officer for the city of Barcelona, noted that the city has reduced costs by about $3.1 billion a year by installing sensors in public water pipes and parking meters so they are used more efficiently, among other applications. Barcelona is also a Cisco customer.

While it’s often challenging to convince civil servants to update technology, public IoT projects in Barcelona have helped the city operate more efficiently when the rest of Spain is struggling, Sanroma said.

“We think we will be part of the recovery of the region.”

 
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