News Column

IoT seen to transform GCC economy

July 2, 2014



Kuwait Financial Centre "Markaz" recently published a research report titled "The Internet of Things: Big Data, How GCC will benefit". The report analyses the impact of revolutionary developments such as Big Data. The idea that any physical object can link with the internet and communicate with other connected objects to relay information to humans is a profound development in the evolutionary arc of the digital age. The concept of everyday objects connecting to the internet gives rise to the scenario of a society underpinned by an extensive network of communicating objects, thus aiding in effective automation of many tasks. The network of things works mainly through radio frequency identification technology or RFID. The age of the intelligent machines also means that there are serious potential pitfalls, such as rampant privacy concerns.

As the concept of the Internet of Things (IoT) sweeps the globe, the GCC is expected to be among the early pioneering adopters. The GCC has its very own unique context, which requires IoT policy prescriptions that are tailored to the region's specific needs. The benefits of IoT have to address GCC's economic and social goals, such as economic diversification and the strengthening of the private sector. Thus, the ways through which IoT can potentially impact the way of life in the GCC is vastly more important that simple analysis of market size estimates. This is also due to the fact that the IoT is a disruptive development, which has the potential to exceed the farthest bounds of human imagination, over the coming years, in terms of its impact of human societal history.

One of the key areas for real-world IoT application is in the idea of Smart Cities. A Smart City utilizes intelligent technology to improve quality of life in urban environments. With 75 percent of the global population projected to live in urban centers by 2050, the concept of Smart Cities is gaining in acceptance among policy and governmental planners. As multiple global corporations drive the agenda of smart homes and smart cities, the value creation in terms of money through deployment of "killer apps" is tremendous, as well.

The structural platform supporting IoT is the rapid developments made in the concept and practice of Big Data analytics. Big Data can be defined in simple terms as volumes of data that is so large that it is extremely difficult to process and analyze them with traditional statistical techniques. Big Data analytics is simply the application of sophisticated analytic techniques to such large data sets with usually real-time information processing capabilities. Such capabilities allow for predictive data analysis. In other words, patterns and insights can be gleaned from data that can in turn be used for operational, strategic and tactical purposes. The intersection of IoT and Big Data has far reaching benefits for the GCC, as it can help in the agenda of economic diversification and the spawning of SMEs in the region.

If the GCC can make strategic and effective use of the IoT and Big Data enabled technologies,     a new era of competitive differentiation based on technology and human skills can be begun. For instance, large corporate houses and government services can use the capabilities provided by Big Data to effectively predict customer response to product launches, target new revenue streams through identifying patterns of emerging customer demand, detect financial fraud in real time, etc. It is notable that across the Middle East, Big Data is being dubbed as the "new oil" as the region moves aggressively into developing itself as a knowledge economy zone. Even minuscule effective usage of IoT and Big Data can add at least a minimum of USD20 billion back into the economy of the GCC as cost savings, through applications in various industries, ranging from oil to aviation. The potential of the IoT wave lies predominantly in generation of new markets, creating better service and product efficiencies and in capturing significant cost savings. Moreover, the IoT revolution can help in the transformation of the GCC into an innovation economy. The greatest contribution of the IoT phenomenon to the GCC may very well lie in furthering the agenda of the knowledge economy and innovation.









 


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Source: Arab Times (Kuwait)


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