How the world will change as computers spread into everyday objects

As Hurricane Dorian advanced towards the east coast of the States, Tesla drivers found that their cars could travel further on a single charge of their batteries. Like many modern vehicles, Tesla cars could be thought of as internet-connected computers on wheels. Entry level Tesla cars come with parts of their batteries disabled to limit their range. The company was able to disable these restrictions at the tap of a keyboard and give drivers the ability to use the full power of their batteries.

A trillion connected devices

This is evidence of a broader trend. As connectivity and computers become cheaper, they will be included into many things which are not computers: coffee machines, cows, nappies, and factory robots. This revolution has been slowly gaining steam for years, but it is about to go into overdrive. A forecast predicts that by 2035 there will be a trillion connected computers built into everything from bridges and clothes to food packaging.

Computers will be convenient for customers, providing products which can do new things. Businesses will gain efficiency. Information about the physical world which was once ephemeral and uncertain will become analysable and concrete. Computerised machinery can manage its own upgrade and maintenance schedules. Smart lighting saves energy in buildings. Connected cows can supply real-time information on their eating habits and vital signs, enabling them to produce more milk and remain healthy. These small gains, compounded again and again across the larger economy, are the raw material of growth.

No longer goods but services

The internet of things will change how the world works. This could be called the second phase of the internet. Real world companies are going to become tech companies and carry with them business models of platform domination and surveillance capitalism. As this occurs, unresolved issues of ownership, surveillance, competition, data, security, and competition will escape from the virtual world into the real world.

Ownership is an issue illustrated by Tesla’s recent actions. The internet allows firms to own their products even after they have been sold, meaning that these are something closer to services than goods. Traditional lines of ownership are blurred. John Deere has incorporated software restrictions which prevent customers from repairing their own tractors. Because the software in the tractors is not sold but licensed, the firm argues in some cases that the customer might not be buying a product, but rather the license to operate it.

Virtual business models will struggle in the real world. One cannot release a beta model of a fridge. Android products are updated for two years after release, Apple products for five. However, washing machines and industrial machinery have lifespans of a decade or more. Companies will have to consider how support will work for computerised devices after the original programmers have moved on.

Who owns the data?

Another flashpoint is data. Many internet companies offer seemingly free services paid for by the provision of valuable user data, collected with questionable consent. Many connected real world products are similar. Mattresses monitor sleeping patterns, medical devices change and monitor heartbeats and insulin levels, and cars provide insurance companies with data about driving habits. There will continue to be arguments about who owns the resulting data and what should be tracked, and these will seem more urgent in the real world.

Competition is an important point. Flows of data from computerised gadgets are as valuable as those from Google search histories and Facebook posts. Data-driven businesses will replicate market dynamics which have seen the rise of giant platform companies as they collect and process information. The need for connected devices to speak to one another and for standards will add to the leaders’ advantages. Consumer fears will grow over the vulnerability of connected cars, medical devices, and other gadgets to hacking.

Maximize benefit and reduce harm

It is difficult to predict the consequences of technology as universal as computing. Many were optimistic at the advent of the consumer internet. Nowadays the defects of the internet dominate headlines. The trick with the second phase of the internet is to try and maximize benefit and reduce harm. This will be difficult, but people who have survived the first internet revolution will have an idea of what to expect.