IoT Funding in North America
Every great idea needs an investment to get it off the ground. Whether it is funding through the private or public sectors, these sectors should be paying close attention to the burgeoning influence that the Internet of Things (IoT) will certainly have on tech development in the coming years.
However, some critics and observers have perceived a lack of public funding, especially in North America — particularly in the United States. As IoT technologies can improve many infrastructure processes (energy production, transportation, and civil engineering, among others), North American governments should be undertaking more legislative initiatives and partnerships with the private sector to ensure that tomorrow's innovations are getting enough funding today. Here are some ways in which the two sectors can work together and independently to increase funding for IoT technologies.
Public Sector Initiatives
All around the world, significant government funding is being prioritized to support new, innovative technologies that make the technological and organic fuse effortlessly. The government of South Korea has already been rolling out massive funding packages to the development of new IoT technologies — one such package in 2015 alone was worth ₩1 trillion KRW ($934 million USD) and geared towards funding IoT, smart cars, intelligent robots, and wearable technologies. Between 2007 and 2013, the FP7 (7th Framework Programme for Research and Technological Development), the European Union put €130 million ($145 million USD) of its €50 billion ($55 billion USD) science funding towards IoT innovations.
But what of the United States? In California, where the hub of the tech industry is nestled, the state's energy commission has made adaptive lighting the standard. Last year, the California Energy Commission updated its energy efficiency standards to require sensors on inside and outside lights, hoping to reduce its electrical lighting consumption by 60% to 80% by 2020. These shifts in legislation are significant because they pave the way for more sufficient funding towards companies that can further integrate infrastructural data with more personal, natural technologies.
Private Sector Initiatives
Since the monetary return is much greater for investments from the private sector (venture capital firms, angel investors), many tech companies look to these individuals and organizations to fund their endeavours. It is easier to “sell” a brand as a private sector body rather than a government one, so it seems that this influences the tech industry's alignment with the private sector, among others.
In the last two years, IoT companies saw $1.1 billion invested into them across 153 deals, with companies in the IoT reaching an eight-quarter high and with companies in the Silicon Valley making ¼ of the deals. This indicates that investors are becoming less “afraid” of the oncoming shift to IoT technologies, and are ready to put down bigger money to getting these technologies off the idea page and made into a market commonplace.
So, is there really a lack of funding with regards to IoT technologies? Perhaps. But, if the public sector appears to be slacking on the funding end, it may just be because federal and state government have yet to acknowledge the countless uses for this technology to build smarter cities, infrastructures, and civil engineering. A more utilitarian marriage between the private and public sectors is crucial for these new technologies to see the light of day, and for the companies that produce them to flourish.