As a father of future college students, I’m excited that Cisco’s announcement yesterday about the Internet of Everything (IoE) Economy may finally transform college education to provide graduates with the real-world skills needed by businesses today — and tomorrow.

Before I jump too far ahead, let me explain what Cisco announced. Cisco estimates that there are currently about 20 billion things connected to the Internet, yet more than 99 percent of physical “things” remain unconnected. Obviously, there is a huge opportunity to connect the unconnected. IoE aims to do just that by adding people, process, and data to the things that are connected to the Internet, such as devices, sensors, and machines.

To help businesses understand how to benefit from IoE, Cisco IBSG’s Economics Practice calculated the amount of Value at Stake in the IoE Economy. Value at Stake is defined as the value that will either be newly created or will migrate between lagging companies and industries to the leaders over the next 10 years based on their ability to harness IoE. We did this by taking a bottom-up approach of selecting and analyzing 21 industry-specific and cross-industry use cases, including the one I’m discussing here: connected private college education.


From this analysis, the team determined that there is $14.4 trillion of Value at Stake in the Internet of Everything Economy over the next decade. The five main drivers of this Value at Stake are:
1. Lower costs from improved asset utilization ($2.5 trillion)
2. Greater efficiencies from improved employee productivity ($2.5 trillion)
3. Less waste from supply-chain and logistics efficiencies ($2.7 trillion)
4. Greater lifetime customer value from improved customer experiences ($3.7 trillion)
5. Increased return on investment (ROI) and new revenue from faster innovation ($3.0 trillion)

So, how much of this value comes from improved education? For private college education (which does not include public institutions or K-12 education due to the scope of the analysis), the amount of Value at Stake is $78 billion. Cisco sized the value by answering the following questions:

• Can instruction be scaled with video and online technologies?
• Can digitization reduce textbook costs?
• Can colleges reduce their facilities costs by using a different education model?
• What is the return on investment (ROI) of various education models?

Today, college education is mostly a “physical” experience where professors teach students in brick-and-mortar classrooms using printed books. IoE will allow private education companies like Apollo Group, Strayer Education, and others to accelerate their online initiatives, further challenging the traditional educational model. Already, early adopters like Kaplan University are breaking down physical barriers to give students the flexibility to learn at their own pace—anywhere, anytime, using any device.

IoE will further enable new educational business models, extend professors’ reach and influence, and replace static learning from printed books with a dynamic, immersive curriculum model, where the material can change as the knowledge base advances.

The IoE Economy will give colleges in the private sector the ability to scale instruction and provide it at a significantly lower cost to help improve profit margins. And while video and online media are not new to education, in the IoE Economy, they will offer remarkable new capabilities both to improve academic outcomes and to extend the reach of quality education to people who have not had access to it previously. This will have a significant economic impact—for example, by helping address the more technical skills that will be required both now and over the next 10 years.

IoE and education go hand-in-hand, creating a virtuous circle. IoE will drive needed changes to the world’s educational systems and, in turn, education will prepare the next generation of workers needed to create the most value from the IoE Economy.

In a world released from physical constraints, we all win.

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Joseph M. Bradley

Global Vice President

Digital & IoT Advanced Services