Samsung's plan to invest $1.2 billion in Internet of Things startups and research in the U.S. over the next four years is a potentially positive move for the industry, but analysts have differing interpretations about what it could mean.
The announcement was made on Tuesday by Dr. Oh-Hyun Kwon, vice chairman and CEO of Samsung, during a forum in Washington, D.C. Kwon said in a statement that the funds will go toward what Samsung calls human-centered IoT. Part of the plan is to use IoT to help people age in their own homes instead of living in hospitals and nursing homes.
The news is positive for some in the tech industry because it means that other layers of technology, such as software and integration, will be needed. And even those who question what it means still see some benefit potential for the market. The IoT market is predicted to reach $1.7 trillion by 2020, according to IDC.
Dan Ledger, principal with Endeavour Partners, which analyzes the wearables and IoT markets, said, "There
are many different layers of IoT. There are people out there building industrial products or consumer products that sit on a network. There are people building all sorts of layers of software that provide the data. And there are people that provide the chipsets down at the bottom. There are lots of companies out there that have chipsets that do IoT stuff."
Samsung is not only using their own chipsets but making strategic investments and acquisitions as well, which adds to the interest about their investments. "There are certainly a lot of companies racing into this space, there is a lot of excitement around the promise of IoT," Ledger said.
"I take all of these announcements with a grain of salt at this point," he said. "Samsung is getting into this game in earnest alongside Qualcomm and Intel and lots of other semiconductor providers. And I think that the jury is really still out on whether or not they'll be able to build a real meaningful and successful business given the amount of uncertainty that's present in this industry."
The announcement comes on the heels of last week's news that Samsung is going to acquire Joyent, a U.S.-based public and private cloud provider, which rents the use of computer servers and data centers to companies. And in April, Samsung announced the commercial availability of its ARTIK Cloud platform for IoT and connected devices.
SEE: Internet of Things: Five truths you need to know to succeed (TechRepublic)
Jeff Jenkins, co-founder and CTO for APX Labs, developer of the Skylight platform for enterprise wearable technology, said, "Seeing big guys like Samsung make these kinds of moves, especially when you're talking in the B-range of money, is extremely exciting. It's hugely validating for the IoT market and for our industrial wearables market.
"I think specifically when we see any kind of large investment or any kind of movement from any of the big names it's meaningful for us because there is a tie between our space and our technology and the industrial Internet of Things. You can kind of think of it in some ways our tech becomes the first and last mile for the industrial Internet of Things," Jenkins said. "For people like us that bridge that gap between the data sensors, the analytics, and the actual devices, seeing any of the big guys move in any significant way in the IoT market means big things for us."
Jenkins said, "The IoT market is on fire. It's the next-in-line buzzword right after big data."
Matt Lear, M2M and IoT product management director for iconectiv, which manages an IoT device registry for the oneM2M standards body, of which Samsung is a member, said he sees the move as positive.
"IoT is so broad and there is so many different players and for a company of Samsung's size and expertise to jump into the IoT space with both feet and make this kind of investment it really shows that there is a lot of interest and need and importance to accelerate IoT and specifically interoperability in IoT," Lear said.
The economic impact of IoT makes it critical for the tech industry. "IoT is the future. There's up to $11 trillion in economic impact in IoT as a whole and that's why you see a lot of companies reinventing themselves and becoming IoT focused," Lear said.
The 3 big takeaways for TechRepublic readers
- Samsung is investing $1.2 billion in human-centered IoT
- Software and integration are some of the many layers needed to support IoT
- The IoT market is predicted to reach $1.7 trillion by 2020
- Samsung enters the cloud fray with Joyent purchase (ZDNet)
- Samsung advances its IoT push with new ARTIK Cloud platform (TechRepublic)
- Potential IoT legal challenges should be on your enterprise radar (TechRepublic)
- 17 ways the Internet of Things can go horribly wrong (ZDNet)
- Expanding the playing field of the Internet of Things (TechRepublic)
Teena Maddox is a Senior Writer at TechRepublic, covering hardware devices, IoT, smart cities and wearables. She ties together the style and substance of tech. Teena has spent 20-plus years writing business and features for publications including People, W and Women's Wear Daily.