Technology and industrial companies continue to throw billions of dollars at the Internet of Things with the hope of chasing the $250 billion market that the IoT is predicted to be worth by 2020.
The latest to enter the fray is SAP, which will invest $2.2 billion over the next five years to boost its IoT offering. SAP will focus on sensors, big data and smart devices that are leading the charge to digitalize the economy.
“With billions of connected devices, we now have the potential to reshape society, the economy and the environment,” said Bill McDermott, CEO of SAP. “SAP is making another bold investment to help our customers seize the benefits of live business.”
Last year IBM announced plans to invest $3 billion over four years to establish a new IoT division that includes a cloud-based open platform designed to help clients and ecosystem partners build IoT solutions. At the time, Bob Picciano, senior vice president of IBM Analytics, said that a major goal of the IoT initiative will be to help clients act on data collected by things like RFID tags and other sensors.
Early this year Hitachi unveiled a $2.8 billion investment in IoT over three years. Nearly $1 billion of that funding is earmarked to Hitachi’s new IoT division, Hitachi Insight Group. Also this year, Cisco unveiled a $500 million investment to accelerate the country’s digitization effort.
As for SAP, it seeks to enable connected business and connected society, addressing urban and rural areas and spanning agribusiness, infrastructure and energy, health, defense, manufacturing, consumer and transportation industries. While business and public sector entities have unprecedented access to more information and real-time feeds, they still have difficulty tying it all together across operating locations, business units and functional teams.
SAP IoT aims to make sense of big data from the multitude of things through IoT solutions that apply machine learning and integrate with the core business applications of SAP S/4HANA. SAP IoT includes solutions connecting people, partners, things and the physical environment, enabling organizations to extend and enrich business processes with real-time, live intelligence so that they can see where opportunities exist, achieve new operational efficiencies, and re-imagine business models.
SAP plans to establish locations around the world to collaborate on Industry 4.0 and the IoT with customers, partners and startups. SAP IoT labs are intended as lighthouse locations and primary access points for IoT research, development, proof-of-concept modeling and incubation, with IoT showcases, thought leadership, expertise and infrastructure for strategy and product co-innovation.
SAP plans to increase investment in consulting and knowledge transfers with dedicated innovation adoption consulting and IoT universities at the sites. Planned locations include Berlin, Johannesburg, Munich, Palo Alto, São Leopoldo and Shanghai, with SAP and partner experts in areas of specific IoT focus native to each region, such as Industry 4.0, logistics, cities and digital farming. The labs are intended to provide customers with access to co-innovation resources including design thinking experts and workshops, and interactive demos of IoT-related technology including autonomous systems (such as drones and robotics), IoT security, machine learning and 3D printing.