23 May 2018
50% of All New IoT Devices Destined for Asia-Pacific Region by 2026
Asia is set to be the driving force behind the development of smart cities, while also clearly being at the forefront of embracing and utilising Internet of Things technology, according to many of the keynote speakers at IoT Asia 2018.
The Internet of Things (IoT) is taken very seriously in Singapore, with the city recently lauded as the world's smartest, ranking it above such high-profile pretenders to the throne as London and New York. Indeed, the city state even has a designated Minister-in-Charge for its Smart Nation initiative, a government-backed programme intended to harness new technology as a means to "improve living, create economic opportunity and build a closer community".
Tellingly, that Minister – Dr Vivian Balakrishnan, who also doubles as the country's Minister for Foreign Affairs – didn't seem entirely happy with progress to date when he took to the stand to address delegates at the recent IoT Asia 2018 expo, an annual exhibition and conference that bills itself as the continent's leading event dedicated to the sector.
Warning of the growing prevalence of closed systems, he said: "Every big IT company wants to create, behind its own walls, a unique ecosystem, something that they are all trying to lock us into. It is our duty, as a government, to avoid being trapped in a walled garden by any vendor. Instead, we are going to continue to push for open standards, while urging the private sector to ensure their products and services are compatible with these open standards.
"In order to be a success for Singapore, IoT must meet four objectives. First, the security and reliability of all services used by citizens must be ensured, with security hard-wired into all such systems. Then, it must enhance the quality and scope of all such services, while also facilitating opportunities to provide those services. Finally, it must be implemented and utilised in a way that boosts the competitiveness of the local economy."
Balakrishnan, however, wasn't the only government minister attending the event. His colleague, Dr Koh Poh Koon, the Senior Minister of State for the Ministry of Trade and Industry, also made a high-profile visit to the two-day event, largely to officially launch Phase II of the country's Smart Industry Readiness Index (SIRI). Initially introduced in November 2017, this evaluation matrix is said to allow all businesses, regardless of sector, to determine their readiness for Industry 4.0 – the coming shift towards greater automation and unfettered data exchange that is seen as representing a fourth industrial revolution – by assessing the forward compatibility of their systems and practices.
Outlining the importance of the continuing SIRI initiative, Koon said: "While companies are aware of the potential benefits of Industry 4.0 and the need to change, they often don't know where to start and how to begin. Initiatives such as SIRI allow us to support businesses as they look to adopt Industry 4.0 solutions.
"This is a real priority for us as it will ensure that Singapore remains a globally competitive advanced manufacturing hub, one that will continue to attract strategic investments and retain its position in the global value chain. Successfully implementing Industry 4.0 could add S$36 billion (US$27.4 billion) to our total manufacturing output by 2024, while boosting labour productivity by 30% and creating 22,000 new jobs."
Impressive though these figures may be, still more memorable statistics were being bandied around during the course of the event. Overall, for instance, there was pretty much a consensus that the global number of connected devices will top 20 billion by 2020, with 8.6 billion of these active in the Asia-Pacific region. A slightly more imminent prediction, meanwhile, anticipated that 86% of the region's businesses will have integrated IoT into their operations at some level by the end of next year.
Drilling down into these figures a little more, Yogita Kanesin, a Senior Connectivity and IoT Analyst with IHS Markit, a London-headquartered market-research group, said: "With an expected compound annual growth rate [CAGR] of 20%, the commercial and industrial electronics sector is on course for solid growth until at least 2030, while consumer devices will enjoy a more moderate 12.5% CAGR over the same period. As a consequence, by 2025, the number of commercial and industrial devices will exceed those in the consumer sector.
"In terms of smart cities, the Asia-Pacific region is clearly the driving force. As a sign of this, by 2026, half the IoT devices shipped globally will be destined for this region."
Seeing such growth as likely to transform the financial sector in particular, Pauline Sahetapy, Vice-President of the Visa School of Public Policy, the California-headquartered financial-services company's training and advocacy arm, said: "At present, there are more than three billion credit cards in use across the world, as well as 44 million merchant locations. The explosive growth of IoT and e-commerce, however, means there will soon be 10 times as many ways to pay, as well as 10 times as many ways to be paid, including connected cars, wearables and biometrics.
"In line with that, our Cashless Cities Report surveyed developments across 100 world cities. Its findings showed that the increasing level of digital payments across all of these cities could yield total direct net benefits of US$470 billion per year. On average, this represents more than 3% of each city's GDP.
"The greater economic activity spurred by these digital payments will inevitably support a higher level of employment, as well as improvements in wages and productivity. On average, we believe this could be as high as 45,000 additional jobs per year per city, while productivity could rise by 14% and wages by 16%. This would equate to nearly $12 trillion of total additional economic activity over the next 15 years."
Foreseeing an even more drastic social change, Hannes Sjoblad, Chief Disruption Officer of Epicenter, a Swedish digital-technology specialist, was keen to highlight the likely impact of human augmentation. Citing current developments in Stockholm, his home city, he said: "We already hold chipping parties, gatherings where NFC chips are implanted into the hands of attendees. These chips can give users access to their offices without the need for keys or facilitate communication with other connected devices, such as computers, cars, smartphones or even a shared bike app. We've also run an experiment with Stockholm Commuter Rail where the implants serve as tickets.
"In the very near future, we believe such implants will be routinely used as health monitors, while also making cash and bank cards pretty much obsolete. Significantly, these implants are inherently harder to hack, clone or use fraudulently than biometrics or credit cards."
While there was some debate as to which sectors would undergo the greatest transformation as this new digitally enhanced landscape rolled out, it was pretty much universally conceded that data would remain at the heart of everything. Acknowledging its unchallenged ascendancy, Dr Tim Jones, the Programme Director of Future Agenda, a London-based digital think-tank, said: "In a world where multiple systems are being transformed by digital, there are a host of organisations rushing to capitalise on the emerging opportunities. They are not only digitising their businesses and creating new digital business models and platforms, but are also seeing that their future value lies in the data on which such models depend.
"This is common to a wide range of sectors and is evidently fuelling a 'data land grab' by many. Greater interconnectivity is also creating new opportunities for the unscrupulous. Recent events suggest that data sets can be both the most precious economic asset on earth, as well as a liability that can be used against our most precious institutions. As a result, the data debate is becoming extreme.
"While, for some, privacy, encryption and security has become paramount, others are increasingly sharing data for free. In the case of many smart city initiatives, for instance, they wholly rely on open access to public data, with the positive social benefit seen as outweighing any economic loss or privacy concerns. In other cases, several sectors are seeing the greater privatisation of data, with the medical industry being the most obvious example."
IoT Asia 2018 took place from 21-22 March at the Singapore Expo.
Ronald Hee, Special Correspondent, Singapore