The internet of things

Although everybody may think the term the ‘Internet of Things’ (IoT) is a novelty, in reality it was first used publicly in 1999. Kevin Ashton, a Procter & Gamble executive, used it in a speech to explain ways to manage the company’s product distribution, discussing attempts to somehow connect physical packages to the Internet.

The internet of things

Put simply,the IoT is dened as agigantic network of ‘things’ (including people, buildings, cars, airplanes etc)interconnected individually or collectively. Such a network allows any objectto generate useful information and share it in real time (or with some latency)with other ‘things’ or people on the network (wherever they access theInternet). With this information, people can make concrete decisions aboutproblems or needs immediately.

Let’s lookat a real example so we can put the theory into practice. The IoT currentlyallows an enologist at a wine lab in Barcelona decide in real time whether togenerate more humidity in the soil of an inland Australian vineyard where thenext harvest is growing right now.

At presentwe’re witnessing the start of many transformations the IoT will bring to theworld economy and existing social structures. It’s safe to say we haven’t seen10% of the transformation it will bring into our lives over the next 20 years!Specialists agree that in the coming years, artificial intelligence and the IoTwill accelerate a radical transformation in our society. These changes will bethe most profound in the history of mankind, well beyond the Internet orindustrial revolution or the invention of writing.

But whatkind of an impact will it have on the insurance industry? The IoT will becrucial to maintaining competitiveness and efficiency. It also presents amassive growth opportunity for the industry, helping to define new business modelswith greater flexibility, better suited to individual customers. Some insurerscan already change your car insurance premium based on your driving profile (payas you drive), relying on information transmitted by a sensor built into yourcar. It monitors your driving time and speed, and whenever you brake sharply.The same already happens with health care. Connected devices enable us to seejust how healthy a patient’s lifestyle is, basing the premium on this (pay asyou live). Insuretech companies are now a reality and unless traditionalplayers speed up their digital transformation processes, they will miss out onnew opportunities.

But the IoTalso raises a big question: how invasive is it of your privacy? Will our entirelives fall under surveillance when people, and everything we use day -to -day,exchange information about us and our families? Who will hold such informationand how will they use it? We need to properly regulate the use of personalinformation floating around the networks and with the IoT becoming part of ourlives, we need a new legal and ethical framework for this digital world.


The dawn of a new era
We aremerely at the dawn of a new era. GSMA data forecasts show that in 2025 therewill be 25.2 billion ‘things’” connected across the world and we will havecommunications networks with capacities exceeding fibre optics or 5G. This willmake the dream come true: smart cities, planes that fly themselves, control overfood growth and weather to fend off storms and protect agricultural operations,or to generate rain over drought -afflicted regions, smart vehicles to predictaccidents and chip implants to detect health issues. In short, new social,business and lifestyle models we don’t yet know.

Cesar Rodriguez
Born in Barcelona in 1975, Cesar Rodriguez is a telecommunications engineerwith an MBA from the ESADE Business School, and a diploma from the AdvancedManagement Programme at the Kellogg Business School. Much of his career hasbeen with Grupo Telefónica, where he has spent 10 years as an executive inseveral digital development roles in Spain, Colombia and Brazil, and in theCorporate Global Division. He is ceo of Axismed, a Grupo Telefónica affiliate,focusing on developing more efficient health management tools for the widerpopulation. Cesar speaks Spanish, Catalan, English and Portuguese.

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