Why the Internet of Things is called Internet of Things: Definition, history, disambiguation


  • The Internet of Things definition: “Sensors and actuators embedded in physical objects are linked through wired and wireless networks
  • There are a number of similar concepts but Internet of Things is by far the most popular term to describe this phenomenon
  • The term Internet of Things was invented in 1999, initially to promote RFID technology
  • The popularity of the term IoT did not accelerate until 2010/2011 and reached mass market in early 2014
  • M2M or the Industrial internet are not opposing concepts to the Internet of Things. Rather, they are sub-segments.

Internet of Things definition

Why Google’s Internet of Things definition is inaccurate

Have you tried to find a comprehensive Internet of Things definition? Surprisingly, the Google answer is the following: “a proposed development of the Internet in which objects have network connectivity, allowing them to send and receive data”.

Wait. The Internet of Things in 2014/2015 is certainly not a “proposed development” anymore! The Internet of Things is REAL.

And Google should know this better than anyone else. In January 2014, Google acquired Nest, a company currently selling more than 100,000 smart thermostats per month.  As TechCrunch recently put it: “at this stage there’s no putting the [Internet of Things] genie back in the bottle”. (link)

There is plenty of more evidence: Wearable devices like the Jawbone Up have become mass market. The industrial conglomerate General Electric recently announced that they are making $1 billion in IoT-related revenue in 2014. (link)

Some well-known examples for Internet of Things applications today are:

  • Wearable devices/fitness trackers (e.g., Jawbone Up, Fitbit, Pebble)
  • Home Automation (Examples: Nest, 4Control, Lifx)
  • Industrial asset monitoring (GE, AGT Intl.)
  • Smart energy meters

A better Internet of Things definition

So what is a better Internet of Things definition? McKinsey short definition appears quite logic:

Internet of Things =Sensors and actuators embedded in physical objects are linked through wired and wireless networks, often using the same Internet Protocol (IP) that connects the Internet.

This Internet of Things definition leads to an interesting question: If the Internet of Things is not necessarily part of the Internet as we know it, why then is it called Internet of Things?

A brief history of the Internet of Things

The birth of IoT

The term Internet of Things is 16 years old. But the actual idea of connected devices had been around longer, at least since the 70s. Back then, the idea was often called “embedded internet” or “pervasive computing”. But the actual term “Internet of Things” was coined by Kevin Ashton in 1999 during his work at Procter&Gamble. Ashton who was working in supply chain optimization, wanted to attract senior management’s attention to a new exciting technology called RFID. Because the internet was the hottest new trend in 1999 and because it somehow made sense, he called his presentation “Internet of Things”.

Even though Kevin grabbed the interest of some P&G executives, the term Internet of Things did not get widespread attention for the next 10 years.

IoT takes off

The concept of IoT started to gain some popularity in the summer of 2010. Information leaked that Google’s StreetView service had not only made 360 degree pictures but had also stored tons of data of people’s Wifi networks. People were debating whether this was the start of a new Google strategy to not only index the internet but also index the physical world.

The same year, the Chinese government announced it would make the Internet of Things a strategic priority in their Five-Year-Plan.

In 2011, Gartner, the market research company that invented the famous “hype-cycle for emerging technologies” included a new emerging phenomenon on their list: “The Internet of Things”.

The next year the theme of Europe’s biggest Internet conference LeWeb was the “Internet of Things”. At the same time popular tech-focused magazines like Forbes, Fast Company, and Wired starting using IoT as their vocabulary to describe the phenomenon.

In October of 2013, IDC published a report stating that the Internet of Things would be a $8.9 trillion market in 2020.

The term Internet of Things reached mass market awareness when in January 2014 Google announced to buy Nest for $3.2bn. At the same time the Consumer Electronics Show (CES) in Las Vegas was held under the theme of IoT.

The above graph shows impressively how the term “Internet of Things” has outgrown all other related concepts in popularity.

Disambiguation IoT vs IoE vs M2M vs Others

So “Internet of Things” is the most popular term in describing this new interconnected world.

An overview of related concepts

Cisco has been driving the term Internet of Everything (IoE). Intel initially called it the “embedded internet”.

Other terms that have been proposed but don’t mean exactly all the same are:

  • M2M (Machine to machine) communication
  • Web of Things
  • Industry 4.0
  • Industrial internet (of Things)
  • Smart systems
  • Pervasive computing
  • Intelligent systems

How do these terms relate to each other? And how do they differ from the Internet of Things definition?

Internet of Things definition
Click to enlarge image

How the concepts differ from each other


The term Machine to Machine (M2M) has been in use for more than a decade, and is well-known in the Telecoms sector. M2M communication had initially been a one-to-one connection, linking one machine to another. But today’s explosion of mobile connectivity means that data can now be more easily transmitted, via a system of IP networks, to a much wider range of devices.

Industrial Internet (of Things)

The term industrial internet is strongly pushed by GE. It goes beyond M2M since it not only focuses on connections between machines but also includes human interfaces.

Internet of Things (IoT)

IoT has yet a wider reach as it also includes connections beyond the industrial context such as wearable devices on people.

Internet (as we know it)

In the above graph, the internet is a fairly small box. In its core it connects only people.

Web of Things

The Web of Things is much narrower in scope as the other concepts as it solely focuses on software architecture.

Internet of Everything (IoE)

Still a rather vague concept, IoE aims to include all sorts of connections that one can envision. The concept has thus the highest reach.

Industry 4.0

The term Industry 4.0 that is strongly pushed by the German government is as limited as the industrial internet in reach as it only focuses on manufacturing environments. However, it has the largest scope of all the concepts. Industry 4.0 describes a set of concepts to drive the next industrial revolution. That includes all kinds of connectivity concepts in the industrial context. However, it goes further and includes real changes to the physical world around us such as 3D-printing technologies or the introduction of new augmented reality hardware.

Further observations

Both M2M as well as the industrial internet are not opposing concepts to IoT. In fact both are a subset of the Internet of Things with a narrower reach.

Did you find this Internet of Things definition helpful or do you have specific feedback? Let us know.

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<a href="https://iot-analytics.com/author/knud-lasse-lueth/" target="_self">Knud Lasse Lueth</a>

Knud Lasse Lueth

Since founding IoT Analytics in 2014, my focus has been to build a team that produces high-quality research in areas such as IoT, AI, Cloud, and smart manufacturing. Throughout my journey, I have authored or co-authored over 100 reports, always with a commitment to delivering analyses that are not only trustworthy but also rich in insight and uniqueness.

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