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Product as a service, brought to you by IoT

The internet of things is changing our world. Small changes right now, with many things happening in the background. For most people, the real impact of IoT will come into focus only when those changes have a direct and noticeable influence on their lives.

Other than the evolution of our cities, roads and transportation into smart, connected and autonomous environments, the greatest changes will be seen in how we relate to companies with whom we do business. These relationships are simple, we spend our money to buy and own things those companies produce.

Imagine a world in which buying and owning most things is a concept only seen in Ken Burns documentaries. Titled The Ownership Culture, the camera follows a family buying tires for “their” car as narrator Neil deGrasse Tyson marvels, “Buying tires! An old family tradition, wasting hard-earned money owning things instead of investing in fun. This poor family probably missed traveling on a jungle safari that year. How sad a time that was!”

It will be a while until we hear Tyson utter those words; for now we continue to live in a buy-it-to-own-it world where our lives are a cycle of earn and spend. Consider:

  • $600 bucks for new tires
  • $2,300 for that new “smart” refrigerator
  • Garage door broke? $800 for a new one, plus $250 installation
  • New carpeting for the house, $4,500
  • Back-to-school clothes shopping at the mall (really, people are still doing this!), $850
  • Nike Cross Trainers, $135
  • $3,500 for patio furniture and a fire pit
  • Camping gear from REI, $1,250

Saving money for summer vacation is nearly impossible with all these cash outlays!

In the very near future, the influence of the internet of things will grow as the term “as a service” gains mainstream acceptance. Consider these soon-to-be-heard advertisements:

  • Home Depot: “Garage door as a service. For a fee of only $29.95 per month, you get a new Chamberlain smart garage door installed including lifetime maintenance. Chamberlain, the leader in bringing intelligence to your garage door, believes your garage door should do a lot more than open and close.”
  • Lumber Liquidators: “Try our new flooring-as-a-service program, where we install smart laminate flooring throughout your home starting at only $29.95 per month. Smart laminate flooring monitors activity, moisture, dirt levels and can even act as your security system, providing the most comfortable, secure and clean environment for your bare feet. Go smart and go back to bare; your feet will thank you!”
  • Nike: “Our new smart Cross Trainers monitor every aspect of your performance AND tell you when it’s time for a new pair. Only $24.95 per month for the rest of your life and you never buy a pair again. When they’ve reached trade-in time, the attractive LED lights will flash and sounds of birds chirping will tell you to expect a new pair to arrive within 24 hours. It’s like dollar shave club, only for your feet!”
  • REI: “The forests are getting crowded. It’s gotten to the point where you can’t find your tent at the end of a long day hiking and enjoying nature. With our new smart tent, you will have no trouble finding your campsite, where a lit, warm and inviting tent will be waiting for you. Only $44.95 per month, and that includes unlimited cloud storage and built-in Wi-Fi to upload your photos, video and statistics each night.”

This is the consumer view.

Consider the dramatic impact on the manufacturers of all this stuff: They make it, sell it and then start over the next day.

Manufacturing companies make things that must be sold to realize revenue for the company. On Monday, they sell 100 things — and Monday is good. Tuesday shows up and whatever they did on Monday, now a distant memory for this new day, starts at zero sales. Every day is like this, starting from zero. For revenue only arrives with the sale of new items. Even if they sold a record-breaking number of things every day for a month, the next month starts at zero.

It’s an endless cycle of make, sell, make, sell … with no end in sight unless the goal is to go out of business. If it’s a public company, this cycle is even more vicious as shareholders demand that revenue levels keep rising quarter after quarter, year after year. Don’t hit the market’s forecasts for growth in one quarter and the stock price is hammered.

You have consumers endlessly spending money to own things and manufacturers making things in an endless cycle of birth and death every day. Our current system is way overdue for that IoT-driven change!

Manufacturers will evolve into as-a-service providers while consumers will start saving all that cash, making fee payments instead. That is the future. Buying and ownership are going to fade slowly away. Not completely and not immediately, but it’s going.

What can you do to prepare? Learn self-control so all that cash piles up and you can stop working and start enjoying life long before “retirement” (whatever that really means). Oh, and invest in airline and hotel stocks before you do. Since you won’t be burdened by owning so much stuff, you’ll be free to travel all the time. Marriott and Southwest Air are going to love this change!

Freedom, brought to you by the internet of things!

All IoT Agenda network contributors are responsible for the content and accuracy of their posts. Opinions are of the writers and do not necessarily convey the thoughts of IoT Agenda.

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