So Cisco Systems, Inc. (NASDAQ:CSCO) has this new study that puts what they are calling "the internet of everything" at a value of around $14 trillion over the next 10 years. The Internet of everything, or IOE, is "the networking of people, processes, data and objects." Considering 99% of all physical objects are not connected to the Internet, there is huge growth connecting them-- Cisco expects 50 billion objects being connected by 2020. The company's CEO, John Chambers blogged that:
"I believe that businesses and industries that quickly harness the benefits of the Internet of Everything will be rewarded with a larger share of that increased profitability... This will happen at the expense of those that wait or don't adapt effectively. That's why the value is 'at stake' -- it's truly up for grabs."
So who is grabbing the early stakes in this next growth stage of the Internet?
Android wants to control your world
In the future, all of your household electronics and appliances may be connected. IDC predicts the market for intelligent, connected devices will reach $2 trillion by 2015, with analyst Al Hilwa explaining that:
“Android is sitting pretty in this space to take more share from the incumbents... The fundamental advantage with Android is that the vendor can take a bigger chunk of the software and own it.”
Google Inc (NASDAQ:GOOG) is extending Android further into things such as "smart appliances," which will make it easier for internet-connected devices to communicate with each other. It will also allow Google to collect more data and continue to build up its search empire. Google's open platform seems destined to dominate the "smart devices" market early. Companies like Panasonic Corporation (ADR) and Samsung are already selling Android-run appliances that can be controlled by smartphones and provide users with data, such as Panasonic's SR-SX2 rice cooker that can have recipes found on an Android smartphone sent to it while also providing data regarding its electricity usage in the process.
Setting cooking instructions for an appliance from your smartphone is just the beginning, according to Bloomberg authors Cliff Edwards and Ian King, who also envision your television one day being able to "show a pop-up message from a clothes dryer in the basement, indicating that the homeowner’s jeans are not yet dry. The user could press a button on the TV remote to automatically add 15 minutes to the dryer cycle." When it comes down to it, Google Inc (NASDAQ:GOOG) seems to be pushing ahead in the race with its Android OS.
Old products mixing with new technologies
Consumer staples aren't traditionally flashy tech-like investments. They make simple products like razors and soap. They are often seen as defensive stocks. They may soon be getting more comfy with the Internet in the future, however. Unilever plc (ADR) (NYSE:UL) is apparently looking to experiment with the "Internet of everything." Phil Giesler, vice president at Unilever’s new business unit, realizes that:
“Consumers use ours products in the kitchen and bathroom... If we can get an interface with those consumers in those places, and maybe understand how their devices and white goods in those areas are working, it could open up possibilities in terms of promotion or purchase.”
Unilever plc (ADR) (NYSE:UL) is onto something, and competitors will most likely follow. If Google gets the early lead in IOE, they will be selling a lot more of their data to companies such as Unilever.