CES 2014: Cisco's Internet of Everything Vision

The term "Internet of Things" has become as popular as "big data," perhaps more so. It now extends beyond its original scope -- radio-frequency identification tagging of objects in the physical world -- to include a broader view of machine-to-machine interaction.

Here's how the University of Cambridge's Auto-ID Lab, one of seven global research centers studying automatic identification of supply chain objects, describes how enterprises could benefit from the IoT:

Put a tag -- a microchip with an antenna -- on a can of Coke or a car axle, and suddenly a computer can "see" it. Put tags on every can of Coke and every car axle, and suddenly the world changes. No more inventory counts. No more lost or misdirected shipments. No more guessing how much material is in the supply chain -- or how much product is on the store shelves.

Expanded beyond manufacturing, the IoT could enable countless data interactions and transactions as billions of devices -- everything from set-top TV boxes to home thermostats to automobile sensors -- join the global network.

[Connected cars are gaining traction -- but what about privacy? Read Internet Of Things Meets Cars: Security Threats Ahead.]

MachineShop is a Boston-based startup that provides authenticated, metered, and managed APIs for connecting devices to the Internet of Things. The two-year-old company, which exited stealth mode on March 20, provides what it calls a Services Exchange: an API store with business logic, event management, and communications services for developers building and integrating IoT solutions.

Communication on the IoT will occur via standard services or APIs rather than legacy platforms, middleware, or proprietary protocols, said MachineShop CEO Michael Campbell in a phone interview with InformationWeek.

"This is really a new-generation middleware approach," said Campbell. "What we're hoping to do is get folks to understand that there is this domain known as the Internet of Services, a collection of APIs… that probably is as important as the Internet of Things layer itself."

MachineShop faces plenty of entrenched competition, Campbell noted, including "traditional enterprise middleware platform guys" such as IBM, Oracle, and SAP.

"If you're an electric utility and have billions of dollars invested in infrastructure systems that are now being connected to the Internet -- and spewing out terabytes and petabytes of data a day -- your typical course is to work with one of the big enterprise platforms and say, 'Hey, help me get the data out of these systems.' So you put a platform between the applications and the underlying systems."

The second type of competitor is the do-it-yourself enterprise that writes interfaces between data silos and applications. And the third is an API management company such as Mashery (purchased by Intel last year), Apigee, and 3scale.

"The third category I don't view so much as competitors, but as kindred spirits who are part of this new wave of infrastructure software companies," said Campbell. "These companies embraced the API revolution -- that every product, every piece of content would have an API."

One of MachineShop's strategic investors is Diebold, a financial services and security firm best known for its ATM transaction systems. Diebold also employs a wide range of Internet-connected devices, including security cameras, DVRs, and fire-suppression systems for use at retail, bank, and manufacturing sites. "They wanted the ability to provide a very unique, managed service to their customers -- a portal for the head of security operations to get visibility of an entire security operation."

Working with MachineShop, Diebold developed a solution that separates the application layer from the underlying systems and devices. "Literally there are hundreds of thousands of different pieces of equipment… all talking over a couple of different networks up to the application," Campbell said. "We normalize all of that, and allow Diebold to build a really cool new managed service."

MachineShop's public or private Services Exchange allows customers to subscribe to thousands of managed API-centric services, including those developed by MachineShop, its customers, or third parties, the company said.

Improved platforms, standards, bandwidth rates, and data models mean more IT shops are taking a "cloud-first" approach to new services, keeping only select jobs in house. But what's often left out of the calculus is the impact on the end-user when you outsource most services. Register for this InformationWeek editorial webinar and learn how to avoid the pitfalls of outsourcing IT. The Performance From The User's Perspective webinar happens March 28. Registration is free.