You may have heard about a growing trend in industry and lifestyle called the Internet of Things (IoT). However, many people do not know exactly how much this trend is catching on with big companies. What exactly is the Internet of Things? And, how much will this trend affect the way we live our everyday lives?

According to Business Insider, the effects will be massive. They say businesses are acting fast to accumulate technology companies in order to develop new ways to merge the internet with everyday “things.”

So, What is the Internet of Things?

The Internet of Things is commonly defined as “a scenario in which objects, animals or people are provided with unique identifiers and the ability to automatically transfer data over a network without requiring human-to-human or human-to-computer interaction.”

What exactly does that mean? Well, with internet-enabled technology, objects automatically transfer data without the human middleman. Thus, they complete some of our routine daily tasks for us, from ordering products we run out of to adjusting our thermostats. The IoT promises to save money, resources, and valuable time.

How are Companies Preparing?

Major companies are acting quickly to develop new IoT-enabled devices. Google spent more than 4 billion dollars in the last few months to acquire resource and robotics companies like Nest Labs. Cisco is developing ways to use the IoT in advertising and marketing strategies. The British Prime minister recently invested 122 million dollars into the same development resources, in the pursuit of more efficient living and urban infrastructure.

Business Insider projects that, by 2018, 9 billion devices will be available in IoT. Already, 1.9 billion IoT devices exceed the quantity of smart phones, smart TVs, wearable computers, PCs and tablets in the world, combined.

Applications of All Sizes

The IoT can be applied to everyday small items, as well as large-scale projects. Devices such as smart phone apps and watches can control our home security systems and other personal tasks. But what if we apply those concepts on a broader scale? IoT applications include manufacturing, urban management, and energy efficiency, to name a few.

Conserving Resources

Authorities in Doha, São Paulo, and Beijing currently employ systems that monitor and regulate water usage. These systems detect leaks within the plumbing systems and have reduced water waste by 40%. They can help to better supply lower income countries with water, or monitor the reservoirs and water supply.

Similarly, electricity grid monitors track energy usage. By monitoring energy use patterns and adopting home management systems, we can use our resources more efficiently on both a personal and an industrial level.

Pay For What You Use

Another way that these methods will be useful is in a “pay for what you use” monitoring system. Industries from waste management to car insurance have used this idea. Waste management companies in some major U.S. cities placed sensors in their disposal cans that monitor when the trash is placed out at the curb. This has cut down on the number of routes that the sanitation crews need to run, as well as developed a “Pay-As-You-Throw” system. Customer only pay for the amount of trash they place out, and pay fees for exceeding a limit. Recycling is up and unnecessary pick-ups are eliminated. Cincinnati saw a 17% waste volume decrease overall (Business Insider).

Car insurance companies are also moving toward a “pay as they use” system for their customers. A device in your car monitors your driving habits.

With methods like these in place, companies become more efficient. Companies to work smarter, not harder. Meanwhile, customers pay on more fair scale.

The Future of the IoT

Projections show the IoT spreading more and more as technology advances and competition grows. Companies are betting on the IoT as they spend billions to be ahead of the boom and provide the most innovative ways to save money, operate efficiently, and change the way that we go about day-to day-business. Data is becoming the most important resource, and those companies who excel at collecting data are going to be ahead of the rest. It is an exciting time for technology as we strive to improve our lives. It will be interesting to see how the Internet of Things evolves and revolutionizes our world.