Initial observations on economics, pricing, and penetration of the internet of things market

Abstract

One expectation about the future Internet is the participation of billions of sensor nodes, integrating the physical with the digital world. This Internet of Things can offer new and enhanced services and applications based on knowledge about the environment and the entities within. Millions of micro-providers could come into existence, forming a highly fragmented market place with new business opportunities to offer commercial services. In the related field of Internet and Telecommunication services, the design of markets and pricing schemes has been a vital research area in itself. We discuss how these findings can be transferred to the Internet of Things. Both the appropriate market structure and corresponding pricing schemes need to be well understood to enable a commercial success of sensor-based services. We show some steps that an evolutionary establishment of this market might have to take.