"We see the Internet of Things as an extension of our machine-to-machine business, as does everyone else in the marketplace today," says Mark Bartolomeo, vice president of IoT Connected Solutions at Verizon. "When you think about machine-to-machine, what you're really looking at is connecting devices and collecting data from those devices. The next big leap for IoT is really about the use case. IoT is about interconnecting these devices for specific use cases and deriving value from the data."

For instance, transportation companies are using data to reduce fuel consumption, while local governments are turning to smart LED street lighting that doesn't need regular maintenance but automatically reports when it needs repairs. Utilities are deploying smart meters that provide more granular data on energy usage while minimizing or eliminating the need for home visits.

One highly recognizable example of IoT in action is the way automotive insurers have begun setting premiums for commercial and fleet customers though usage-based insurance. Rather than rely on broad indicators like the driver's age and gender, these insurers are installing devices in the users' vehicles. These devices can track how many miles a driver drives in a year, when and where they take their trips and how safely they drive. With this data, insurers can align their premiums against measured risk.

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