Last week the New York Times broke news of a top secret lab where secret Googlers are tinkering on more than 100 fantasy projects that may or may not ever come to market. It's called Google X Lab and it's filled with robots, self-driving cars (those are definitely real) and real-world devices not traditionally connected to the Internet that will be wired-up into a future Web of Things.

What if Google doesn't get connected devices any better than the company allegedly "doesn't get social" technologies, though? Just because the advertising and search giant is working on it doesn't mean Google can really build an elevator to space, of course. In the mean time, other companies are building connected device technology that sounds futuristic but is actually going to market right now. Those companies may compete with Google in the future; just as Google didn't invent the search market it now owns, incumbents can't rest easy yet just because they're first, either. But what they're bringing to market already is pretty cool.

A Ten Year Old Market, Now Changing Fast

Ten year old Massachusetts firm Axeda is a leading provider of what it calls "a cloud for connected products." It provides a cloud-based software layer that draws in streams of device sensor and machine data originally intended only for monitoring the firmware of say a dishwashing machine, translates that into discernable business objects like temperature, location and performance metrics, then offers an application programming interface for developers to interact back with the real-world devices that the data was gathered from.

I don't often take calls from companies that say they want to tell me about themselves based on a well-known story in the news, like Google X, but Axeda is really interesting and has some great stories to tell about connected devices that are on the market today or will be very soon. The following are the examples they shared and a good overview of the kinds of things that connected devices, what Google calls the Web of Things, what others call the Internet of Things and what Axeda calls the cloud for connected products, is shaping up to look like.

The connected device market is dominated today by healthcare applications, and some examples of those are discussed below, but the paradigm is already extending into other applications throughout everyday life.

Speed Signs as a Service

If you've ever driven past one of those big signs on a road that show you your own driving speed, you might have wondered who else was seeing that information. Originally, no one else was. A company called AllTraffic sold those signs to government agencies around the US as a hardware play. Stick it on the side of the road and show people how fast they are going - hopefully it will cause speeders to slow down.

About a year and a half ago, though, they connected those blinking signs to a web portal accessible by police headquarters and citizens, using Axeda's connectivity technology. Now they sell access as a subscription and they've changed from being a hardware vendor into a software and service vendor.

Bill Zujewski, EVP of Product Strategy and Marketing at Axeda, says that the effect in that case is the same kind of thing Google is going to try to do: to change the consumer experience by adding connectivity to devices. Everyone knows what it means to have OnStar added to a car, for example - it enables emergency services on a whole new level. Now think of that same kind of experience-changing connectivity added to other products.

The new goal: to change the consumer experience by adding connectivity to devices.
Kodak's Pulse photo frames, for example, represent the same kind of shift - that company took a commodity object, the picture frame, and turned it into a wired-up social center of consumer value. Anyone in possession of the right email address can send photos directly from their phones into the picture frames of family members.

Meanwhile, insurance companies are working on pulling the information out of a car's engine that mechanics do during diagnostics and sending it persistently over a cellular connection, up to a web portal for end-user applications. Teen drivers won't be able to speed, hit the brakes hard or drive through geofences without that being visible to any approved eyes.

Managing the Machines

Zujewski says Axeda works primarily with B2B companies, traditionally in the form of asset management. One company that provides high-end industrial equipment for cutting fabric, outside the price range of many small firms in the clothing and apparel industry, has begun using Axeda's technology to embed a "pay as you go" model. A sensor takes data off the equipment, sends it to the equipment provider via cellular connection and then sends a monthly bill charging for the amount of use the machine saw.

Likewise, there are places around the world, Zujewski says, where fabric cutting machines get used in excessively high heat and humidity. The machines keep breaking and it's expensive to repair them under warranty - so machine manufacturers find it quite valuable to be able to monitor that the conditions their equipment is being used in are compliant with the terms of those warranties. All it takes is a USB port. It's too bad they can't monitor the working conditions of the factory wetware the same way. There may be eternal judgement for that, though.

Machines in the Home

Medical devices are one of the primary use-cases for device connectivity, but that doesn't always mean in-hospital inventory. Sometimes it means enabling people to avoid hospitals.

Instrumentation can lead to efficiency, innovation, competition and more innovation.
Zujewski says his company is working with a manufacturer of kidney dialysis machines, for example, to add monitoring and connectivity to equipment that usually requires weekly trips into a hospital. "By connecting them, the providers can monitor them," he says, you call pull data off the machines to make sure they're working well. There are lots of consumables [medication] involved with dialysis and connected monitoring technology can automatically create an order to ship replenishment of those when needed."

"Some of these efforts may connect to mobile apps, but we connect to the cloud as our primary focus," Zujewski says.

"I think Google may think there's an Android play here as well, connecting things like sports equipment, your home and your car to communicate with your mobile device.

"That's the future where things are going: your appliances in your home are getting more computerized, they are running more on software than on mechanical parts."

This Dishwashing Isn't Just Magic, It's Efficient

Zujewski shared a story with me about a dishwasher manufacturer that made a mistake. The company didn't program its rinse cycle to be long enough and was getting thousands of phone calls from customers complaining that the machines weren't working well. The company sent a technician out to reset the rinse cycle timers - but future iterations of the machines saved all those costs by adding read/write cellular connections to the dishwasher computers that could be re-calibrated remotely.

Ovens, dishwashers, all kinds of appliances get shipped from the factory with certain assumptions. Add connectivity and they can be optimized, in the field, remotely.

That appeals to manufacturers and consumers - but once the computer is on board, you may as well start building apps that add value directly to the consumer as well.

Want to start the pre-heating cycle from your phone, while on your way home? Can't remember if you turned your oven off or not? An application framework layer on those devices enables engagement with the devices themselves via mobile device.

"Right now, costs are around $50 per month to retrofit devices with connectivity, but if you can do it with a chip involved at the origina of design, it can be around $10 per month."
"Because cellular connection capabilities for these devices are coming down from hundreds of dollars, sprinklers, garage doors, smoke detectors, all kinds of things are being experimented with as connected devices," Zujewski says. "It wasn't economic before because consumers wouldn't pay for that connectivity, but if it was a couple cents a month, then they will. Right now, costs are around $50 per month to retrofit devices with connectivity, but if you can do it with a chip involved at the origina of design, it can be around $10 per month."

If you can engineer connectivity right into the product from the start, the price drops dramatically. The sales cycle is long, though, because it takes years to bake connectivity into the core of a device.

And cellular carriers still need to adapt, Zujewski says.

"Carriers are set up for consumer plans, not M2M [Machine to Machine] - that will require unique data plans."

The Challenges Ahead

If you think Twitter and Facebook spew out a large quantity of data, imagine a refrigerator "checking in" about its temperature and contents all day and night.

"Ideally you could put some intelligence on the device itself so you don't have to send all your data over the network all the time, but process it locally," says Zujewski.

"You can now build mini-computers that run the whole Linux kernel on an intelligent agent, locally, and only send data when it changes, with threshold rules, for example. People are starting to put M2M computers on devices and make the processing local.

"The other thing happening is that a lot of early customers use 2G, but they are upgrading to 3G and 4G so even if they have to send a lot of data, the price is falling.

"Storage prices have come way down and we're using non-relational stores to keep our costs down."

Will Google Flush M2M Down the Crapper?

What of Google's entry into the market, though? Are incumbents like Axeda scared?

"Google getting in is a good thing for us," says Zujewski.

"It's going to raise the awareness of M2M. When executives in the board room say 'I see Google connected a smartphone to a dishwasher, why can't we connect to our equipment or our products?' it's going to raise the visibility of what you can do.

"What Google is going to find out is that connecting is pretty hard, a lot of devices aren't serving data that's usable. There is a need for a layer that turns the raw available data into usable data like temperatures, etc. into a data model that programmers can use.

"That's our secret sauce, our unique value proposition: our technology converts raw data into business data.

"It comes in obscure message format packets, with headers etc. we've got a whole set of parsers and translators that turn that into an asset, temperature. We have a rules engine that allows you to create notifications, web services layer available by REST, can do mashups with HTML or javascript."

Zujewski says that most of these data production schemes were implemented by dishwasher or road sign producers five years ago, with no intentions of offering a standardized web services application data layer. They didn't want to shoot data over pricey networks and store it in expensive storage systems. They just wanted to use a computer in the machine. Everything has changed since then, though. Add connectivity and you're talking about a qualitatively different phenomenon. Bridging the gap between the status quo and the future is, in this case, non-trivial, Zujewski says. Axeda has to do the work to turn low-level protocols into semantically rich protocols.

"That's changing," says Zujewski of the device manufacturers.

"They are going to start embedding our protocol and sending intelligent data over networks. One of our goals is to get our protocol in as many devices as possible.

"We're fine if Google takes the time to push a protocol, we could embrace that if it takes off. We've got a codex server that will translate anything into Axeda protocol and we'll probably just adopt whatever Google does or support it.

"It's hard to tell what they're really aiming to do because you can't tell what their business driver is. Fortunately for them, they have the luxury of setting up these labs without worrying about that too much right now."

Axeda has been around for ten years and has seen the technology intended for manufacturer cost-savings turn into a nascent platform for value delivered to consumers and a point of competitive differentiation.

"The business case to date today has been about taking costs out of managing your products, remote service and software management," Zujewski told me. "That's been paying our bills. But we're also starting to see revenue generation of connected products where the connectivity serves the user. It's a competitive differentiator and device vendors will soon begin competing with value added services based on connectivity."

How fast will this paradigm reach ubiquity? Zujewski says Axeda is working with one vendor that's network-connecting...toilets. From prisons to large exhibit halls, you don't want water running day and night from a large number of toilets. Axeda's sensor-cloud-application platform can detect, report and facilitate management of one toilet out of a thousand that's broken. That's not live yet, but toilets will be connected to the Internet in 2012, Zujewski says.

That may be the future, but not by very far.

What have you got, Google?