The Industrial Internet: The Next Great Economic Revolution
It’s often argued that the most important era in U.S. history was the Industrial Revolution, that period from roughly 1760 to 1840 when almost every aspect of business and daily life changed.
The shift from manual labor to machines, from wood to coal, from farms to cities – those are just a few of the ways our world changed dramatically when a new era of U.S. economic power was born. We are now at the beginning of the next great economic era, which is being ushered in by the Industrial Internet Revolution. Today’s world has approximately 6.8 billion people and 12.5 billion connected devices. At the rate things are going, by 2020 we’ll have about 7.6 billion people and 50 billion connected devices.
What happens when we can merge the power of intelligent devices, intelligent systems, and intelligent automation with physical machines, facilities and networks? One answer is that an estimated $10 trillion to $15 trillion–an amount nearly equal to the current U.S. economy – will be added to the global GDP, according to Peter Evans, GE’s director of global strategy and analytics, and Marco Annunziata, GE’s chief economist.
In their November 2012 report, “Industrial Internet: Pushing the Boundaries of Minds and Machines,”Evans and Annunziata also predict that 46 percent of the global economy, or $32.3 trillion worth of global output, will benefit from the Industrial Internet.
Why is this important? Because “emerging markets have an advantage in 20th-century things like labor costs,” says Kenneth Cukier, co-author of Big Data: A Revolution that Will Transform How We Work, Live and Think. He argues that big data “lets the West claim an advantage in the 21st-century way, as one can become more efficient and productive by harnessing the data.”
This emerging ability to draw together fields such as machine learning, big data, and the Internet of Things will not only improve efficiency, it will also drive new revenue streams and create new markets, which we see happening all around us already.
As GE’s Evans and Annunziata point out in their report, that powerful combination of increasingly intelligent machines, advanced analytics and a constantly connected, mobile population is “pushing the boundaries of minds and machines.”
How are these changes rolling out in your life? I’d love to hear your perspective on the Industrial Internet, so drop me a line.