When you think of Samsung, you typically picture smartphones, TVs, and maybe even washing machines or semiconductors. You wouldn't associate the South Korean company with light switches, door locks, and delivery trucks. But that's all about to change.
Samsung recently pledged to invest more than $1.2 billion in start-ups and research and development (R&D) for the Internet of Things (IoT) and connected devices. A clear business opportunity exists for technology manufacturers that can stake a claim in the IoT. Market research firm IDC expects the IoT market to be worth $1.7 trillian by 2020. Much of this revenue will be driven by consumers, with each of us expected to own 50 connected devices—our small personal claim in a world expected to produce more than 30 billion connected devices.
Practically speaking, this means sensors on delivery trucks will be able to collect real-time data to detect when the trucks might be at risk of failing. Hospitals will be able to install sensors on beds to correlate patient recovery times with the angle at which the bed is reclined. Sensors on utility poles will be able to create a network that can detect where the majority of utility pole failures will occur. In all of these instances, Samsung could, theoretically, deliver the sensors or the operating system (OS) on which the data is processed, the cloud in which the data is stored, or the security measures that keep the data from being pilfered by hackers.
But Samsung wants to own the action, not just participate in it. Like IoT competitors Intel and Qualcomm, Samsung has heavily invested in microchips and processors. As devices have gotten smaller, so have the chips. As the internet has become more connected, so have the devices that interact with one another. What Samsung is attempting with its massive investment is to create both the devices that power the IoT and the ecosystem in which those devices communicate.
Practically speaking, this means sensors on delivery trucks will be able to collect real-time data to detect when the trucks might be at risk of failing. Hospitals will be able to install sensors on beds to correlate patient recovery times with the angle at which the bed is reclined. Sensors on utility poles will be able to create a network that can detect where the majority of utility pole failures will occur. In all of these instances, Samsung could, theoretically, deliver the sensors or the operating system (OS) on which the data is processed, the cloud in which the data is stored, or the security measures that keep the data from being pilfered by hackers.
But Samsung wants to own the action, not just participate in it. Like IoT competitors Intel and Qualcomm, Samsung has heavily invested in microchips and processors. As devices have gotten smaller, so have the chips. As the internet has become more connected, so have the devices that interact with one another. What Samsung is attempting with its massive investment is to create both the devices that power the IoT and the ecosystem in which those devices communicate.
A Samsung Lightbulb?
But perhaps more interestingly, Samsung could also create the delivery trucks, the hospital beds, the utility poles, and any other product that lends itself to connectivity. Samsung has been coy about whether or not it intends to reach beyond gadget, chip, cloud, and OS development to create things such as lightbulbs, light switches, and door locks. "There's ample opportunity across the board," said Curtis Sasaki, VP of Ecosystems at Samsung. "We don't even have to decide."
Sasaki did discuss the possibility of an exclusive Samsung deployment across a single, connected office building. "If you think of office buildings, you literally have thousands of light switches, plugs, and robust energy management controls," he said. "A single deployment in a building is a lot of products and devices."
Think of the business potential. To take advantage of this, Samsung has taken a four-point approach to owning the IoT. It has already begun building the OS, the storage, the hardware, and the security that will provide the foundation for a global IoT. "By 2020, 100 percent of Samsung products will be connected," said Sasaki. "But we're going further than just hardware, operating system, security, and cloud. We also want an ecosystem of partners."
This means working with other technology companies, auto manufacturers, industrial designers, and even municipalities to help lay the foundation for the IoT. "The IoT space won't be a single company dominating because the space is so diverse," said Sasaki. "We have a lot of consumerization products but our semi-conductor products are also in Dell products. In both cases, we're pretty excited."
Sasaki did discuss the possibility of an exclusive Samsung deployment across a single, connected office building. "If you think of office buildings, you literally have thousands of light switches, plugs, and robust energy management controls," he said. "A single deployment in a building is a lot of products and devices."
Think of the business potential. To take advantage of this, Samsung has taken a four-point approach to owning the IoT. It has already begun building the OS, the storage, the hardware, and the security that will provide the foundation for a global IoT. "By 2020, 100 percent of Samsung products will be connected," said Sasaki. "But we're going further than just hardware, operating system, security, and cloud. We also want an ecosystem of partners."
This means working with other technology companies, auto manufacturers, industrial designers, and even municipalities to help lay the foundation for the IoT. "The IoT space won't be a single company dominating because the space is so diverse," said Sasaki. "We have a lot of consumerization products but our semi-conductor products are also in Dell products. In both cases, we're pretty excited."
Is Samsung the New General Electric?
If in 2016 you think of Samsung as an Apple competitor, by 2020 it might be more appropriate to consider it in the same vein as General Electric. General Electric started as a company that produced electric lamps, but then it began to produce the energy to power the lamps. Next, it began investing in businesses that would use the energy it produced to run their products. It quickly became a leader in electric product development, creating things such as the X-ray machine, the electric locomotive, electric kitchen appliances, and even the toaster oven. The company has registered more than 67,500 patents.
Similarly, Samsung is slowly dipping its toe into the IoT waters one stage at a time. In 2014, it acquired SmartThings, a home automation company focused on connecting home appliances to smartphones and computers. In 2015, it unveiled Artik, its open-source end-to-end IoT platform. In April 2016, it teased its unnamed IoT OS. Last month, it acquired Joyent, a server and data rental company; a few weeks ago, it announced the $1.2 billion investment. In concert, all five actions clearly indicate Samsung's mission to conquer IoT—from the devices we use to the system on which they run to the cloud on which the data they produce is stored.
But, even if Samsung plunges head-on in an attempt to conquer the IoT from every angle, the company knows it's a real long shot. This is why it's hedging a bit by focusing on partnerships. "From a Samsung perspective, it would be a shame on us if we can't get all of our products to work together seamlessly," said Sasaki. "But most people don't have a 100-percent Samsung home. That's where the interoperability [with other manufacturers' devices] matters. Unless we do this in an open way, we may explode the entire adoption into smart homes. Better to get consumers educated, have products interoperate [with other manufacturers' devices], and create a seamless experience between Samsung products."
Samsung will divide the $1.2 billion it invests between internal projects and external start-ups with which it can partner to advance IoT development. But the company also has a cash pile of more than $60 billion it can use to research an incursion into gadgets, fixtures, automobiles, and anything else driving data into the IoT.
Source: pcmag.com
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