The Internet of Things (IoT) is exploding. Last year, there were more than 10 billion connected devices worldwide from washing machines and thermostats to GPS trackers and smart utility metres.
The number of connected devices continues to surge. Gartner predicts that 25 billion IoT devices will be deployed by 2021. Long term, companies like Intel see the potential for 200 billion IoT devices worldwide. Incredibly, within a few years, 100% of the global population is expected to have LPWAN coverage, the wireless network that enables every IoT product.
In total, the global IoT market is estimated to be worth $1.7 trillion this year but, by 2025, is expected to create between $4 billion and $11 billion in economic value.
This market is huge and growing rapidly. Companies that find a way to capitalize are set to experience a once-in-a-lifetime growth opportunity. One of those companies is an iconic Canadian brand that has had a long and tumultuous history.
The great transformation
BlackBerry (TSX:BB)(NYSE:BB) isn’t what you think it is. For most people, the company is associated with one thing: smartphones. Not good smartphones, mind you, but old junkers that can’t come close to today’s standards. While that was true, it’s isn’t true today. That’s because BlackBerry no longer even makes smartphones. Instead, it’s focused on providing next-gen security solutions for rapidly growing end markets.
This pivot from smartphones to security software isn’t as crazy as it sounds. For years after its peak, businesses and high-profile users like politicians continued to use BlackBerry phones, not because they were a joy to use, but because they offered the best security features on the market.
BlackBerry phones were really secure devices first and phones second, which makes sense why the company lost the phone wars long term. Therefore, the recent transformation isn’t pivoting to something new but back to the company’s original roots.
The great web
The rise of IoT will be rapid, and many companies are looking to capitalize. Thus far, however, most seem to be set on creating the hardware. Few companies are focused on the support infrastructure, such as security software.
While it may not seem terrifying to have someone hack your IoT-enabled washing machine, a hacker could actually access some valuable data, especially if the machine had a microphone that could be commandeered to eavesdrop on your conversations. These examples may seem silly, but the threat of security breaches for IoT devices will continue to explode as the number of IoT devices grows, especially considering all of these devices are meant to interact with each other to create a complex web of interdependencies. Hacking one might offer incredible access to thousands, even millions of devices worldwide.
According to BlackBerry, the average cost of a data breach is an astounding $3.86 billion. The proliferation of IoT devices raises the risk of a breach exponentially. Businesses are going to spend big on security, and BlackBerry is one of the best positioned providers to meet that mounting demand.
BlackBerry already has an early lead. It’s working with healthcare companies to improve outcomes for patients and practitioners with advanced medical devices, improved record keeping, and mobile access to patient records, all in a highly secure way. The company is also helping banking and financial services firms to protect customer data, comply with strict regulations, and improve customer satisfaction.
The IoT is one of the largest untapped opportunities in history. You don’t want to miss out of these events, and BlackBerry stock gives you direct access.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
The Motley Fool owns shares of and recommends BlackBerry. The Motley Fool recommends BlackBerry and Intel and recommends the following options: short January 2020 $50 calls on Intel. Fool contributor Ryan Vanzo has no position in any stocks mentioned.