Introduction to the Economy of Things
What Is EoT?
The Economy of Things (EoT) is a term used to describe the monetization of things made possible by the Internet of Things (IoT). EoT identifies the new value which can be extracted from IoT as physical resources become digital assets. Of course, some resources may be harder to digitize, but those which can be brought into the digital marketplace will see unprecedented levels of economic growth. Ideally, the Economy of Things will be comprised of IoT devices which are able to constantly communicate with each other while trading in the digital marketplace without human input.
In this sense, EoT is able to create a liquid marketplace composed of physical assets characterized by real-time payment options, utilizations, and discoverability. The assets in this liquid marketplace can then be indexed so that they can be accurately traded as online commodities. This translation of physical assets into digital ones is being referred to as a liquification of the physical world.
The Benefits of EoT
Besides the liquification of physical assets, the EoT also offers new strategies in risk management. This is because the EoT provides new levels of accuracy when it comes to credit pricing and associated risks. Various characteristics of devices connected using IoT permit increased risk management, such as, GPS logs, social networks, digital currency, and device instrumentation. These IoT technologies can provide financial institutions with clearer assessments of risk scenarios. At the same time, EoT offers reductions to the detrimental costs of repossession efforts.
Improvements in efficiency are also expected in industries which previously have not been affected by information technologies. Indeed, EoT is expected to greatly affect and streamline those industries which have not quite caught up with technological developments.
Imagining a Future with EoT
With the future of IoT leaning toward the creation of EoT, there a number of questions which industry leaders can address to determine whether or not they are ready for a world enriched by EoT. First, how do you expect to generate value through the novel methods of asset utilization? Fortunately, improved risk management strategies and efficiency practices can provide part of your answer. Secondly, you may want to consider how you will analyze IoT data so that you can best act on these projections—how will you monetize your physical assets before your competitors catch up to the innovative techniques engendered by the EoT?
If you need help answering these questions or want to learn more, then consider contacting us at Evolution Data where we specialize in developing and implementing individualized IoT solutions for a multitude of industries around the world.