The sum is a long way from the economic revolution that Cisco ultimately foresees. But it's still a huge number, and that, more than anything, is the point the company wants to make with this study.
"It emphasizes that this opportunity is here today," said Cisco CMO Blair Christie in an interview.
Cisco believes an additional $544 billion is still up for grabs this year alone. As more objects are connected to one another, more and more information can be collected, analyzed and delivered to the time and place at which it matters most. Most objects that could be connected haven't been, and it's not yet clear which objects are worth connecting. But Cisco believes more than 10 billion devices are already wired, and that they represent a fertile foundation from which businesses can immediately derive profits.
Christie said that some applications will take time to develop, both because new workflows will need to be devised and because some companies will need to develop and deploy new infrastructure that's suited to IoE's extraordinary traffic and distributed intelligence demands. But others, such as retail programs that rely on location-based analytics drawn from customers' mobile devices, can produce benefits right now. The short-term challenge, she said, has to do not only with technology but also training employees to use real-time data to improve decision making.
Among the businesses that are already seeing IoE value, the telecommunications and financial industries lead the pack. Manufacturing, retail and energy applications have been less robust, but Cisco, which drew its conclusions from a global survey of 7,500 business leaders, believes these verticals represent the greatest potential for competitive gain. To date, the company has observed more IoE activity in developed nations, but the advantage is slim; the report found "parity" worldwide, and concluded not only are companies in emerging markets more confident in their ability to realize IoE value but also that small businesses face relatively low barriers to entry.
Christie said that Cisco was encouraged by several aspects of the survey results, such as the nearly 70% of respondents who thought IoE would help the global job market hold steady or improve, and the nearly 90% who believe the technology won't have an adverse effect on wages. These findings, along with the revenue potential that Cisco sees, mean that IoE could be "key to getting the global economic engine going again," Christie speculated.
Silicon Valley hype? Perhaps. But Cisco has reason to be bullish.
Cisco is hardly the first company to recognize the potential of a connected physical universe. The core concept has gone by other names -- such as the Internet of Things or the Industrial Internet -- and has the attention of parties that range from baseball designers to tech titans such as Intel. The devices themselves are, and will continue to be, manufactured by a variety of companies, and the radios, sensors and languages they use to communicate with one another will likewise spring from a diversity of sources.
While Cisco's $14.4 trillion projection for IoE is aggressive, many companies foresee that IoE-like technology will cause a seismic economic shift. Cisco's angle is that the Internet of Things is merely a group of objects, while IoE is the network -- built from the company's gear, naturally -- that stitches everything together. It's an approach that allows the company to paint a grander vision than many of its competitors.
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