Much has been made of the “Internet of Things” and a growing array of “smart” things that will soon change nearly every aspect of our lives — from Google’s driverless car and iRobot’s Ava 500 video collaboration robot to “smart” pill bottles that will automatically renew a prescription and remind you when to take it.

While we often think that it’s all about the things, it’s not actually the “things” that create the value, it’s the connections among people, process, data, and things — or the Internet of Everything—that creates value.

You can see the power of connections by adding a sensor and an Internet connection to any “dumb” thing. Consider, for example, your front door lock. It has no “intelligence” of its own — it’s simply a mechanical device that allows you to open and close the front door of your house. But if you add a sensor with a connection to the cloud, that “dumb” device can take an image of your face, send it to the cloud for analysis, and determine whether or not to let you into the house, based on facial-recognition technology. The lock itself doesn’t have the intelligence or compute power to make this decision, but the cloud does. It’s the connection that makes this “dumb” thing “intelligent.”

A thermostat is not a “smart” device; it simply has a sensor that tells a heater or air conditioner when to turn on and off. But if you add a connection to a local weather service and combine it with the intelligence of the cloud, the thermostat will be able to adjust automatically to weather conditions. For example, it might gradually turn on the heater a half-hour before you come home from work if a cold front is approaching, saving energy.

And if we add the “network effect,” the value of the connections grows exponentially as the number of connections grows. Whenever you connect something to the network, and it connects to other things, which are in turn connected to still more things, then everything on the network has access to the aggregate intelligence of everything else.

So, if all the thermostats in your neighborhood were connected to the cloud, the utility company would be able to monitor energy consumption in real time and predict usage spikes. This would supply power more efficiently to your neighborhood, and to all the neighborhoods in your city. Things working together with other things create powerful solutions.

Today, 50 percent of all energy is consumed by cities, and that number is only going to grow. By 2050, most of the world’s population will live in urban areas, creating the need for very efficient, intelligent systems to lower power consumption, minimize traffic congestion, and reduce pollution. Cars will be able to talk to one another and to sensors in roadways to find the most efficient routes. Drivers will be notified where the nearest parking is available, then pay automatically via a sensor embedded in the parking space. Connected street lights will brighten or dim based on weather conditions, traffic, and the presence of pedestrians. Even connected garbage dumpsters will be able to tell waste management trucks when they need to be emptied, and suggest the most efficient route for each day’s pick-ups.

There are about 10 billion connected things in the world today. In the next 10 years, that number will grow to 50 billion things, increasing the intelligence and value of all of these connections exponentially — billions of things, but trillions of connections. In other words, in the Internet of Everything, as in life, it’s not what you know, it’s who you know. Connecting dumb things makes them smart, and helping them to work together makes them even smarter. This is the power of the Internet of Everything.