Microsoft Business Predictions for 2015: IoT matures, cybersecurity bulks up, and machine learning gives businesses a big advantage

During my career I’ve been fortunate to work with organizations in both the public and private sector as they adopt cloud technologies to transform, become more responsive and achieve measurable business results.  Today companies in every industry and geography, including 80 percent of the Fortune 500, are utilizing Microsoft’s cloud to become more competitive and deliver greater impact. As we look at the key business drivers for 2015, we’re predicting greater growth and agility, from technologies that evolve from the Internet of Things, cybersecurity and machine learning.

Internet of Things will go mainstream

IoT continues to mature across a range of industry sectors, and companies are focused on the actionable potential IoT holds for businesses today. People are eager to understand and implement IoT in their businesses, a trend that’s reinforced by a 430 percent increase in searches for IoT on Bing in the last 12 months.

IoT is not just about connecting “things” anymore; this proliferation of sensors and cloud computing has given businesses access to nearly unlimited amounts of data – which is IoT’s payoff. The challenge for successful companies in the coming year will be to harness this data to act on key insights, improve customer service, reduce time to market, enable new innovation in product and services development, and ultimately transform themselves with new business models and revenue streams.

Rockwell Automation is a prime example of the transformative power of IoT – in this instance not only transforming their business, but an entire industry. Rockwell is building new forms of intelligence to transform the petroleum supply chain by providing managed monitoring and support for its products across the globe. This includes cloud-based solutions that use software, sensors and devices to predict equipment failures along the vast oil and gas supply chain, track performance in real time, and help refine designs and processes to prevent failures in the future – all to ensure your local gas station has fuel when you need it.

From this oil and gas industry example, to the coupons you receive on your smartphone when shopping at a favorite home store, the Internet of Things moved from concept to reality in 2014 and we expect it to go mainstream in 2015.

Businesses will strengthen cybersecurity

In 2014, big-name companies in nearly every industry fell victim to cyber-attacks, prompting FBI Director James Corney to say “There are two kinds of big companies in the United States. There are those who’ve been hacked…and those who don’t know they’ve been hacked.”

A recent survey by the Ponemon Institute showed the average cost of cybercrime for U.S. retail stores more than doubled from 2013 to an annual average of $8.6 million per company in 2014, and greatly increased in the financial services, technology, and communications sector as well.

It’s clear that businesses need to do more to fight the increasing threat of hackers, do more to protect their businesses and prevent huge losses. We’re seeing policy and technology developments that will help businesses beef up security on premises, in the cloud and across mobile devices.

One of the big changes we’ll see is a migration to Europay MasterCard and Visa (EMV), a new technology to protect consumers and reduce the costs of fraud. EMV is a global standard for cards equipped with computer chips and the technology used to authenticate chip-card transactions. Coming in October 2015, merchants using non-EMV compliant devices that choose to accept transactions made with EMV-compliant cards assume liability for transactions that are found to be fraudulent. In 2015, we expect this compliance requirement to drive a massive move to modern card technology and modern points-of-sale devices. That translates to better security for banks, merchants and consumers.

Machine learning will give businesses a leg up on the competition

As we reinvent productivity at Microsoft we’re building tools that are more predictive, personal and helpful. In 2015, businesses will begin to fully make use of big data services in the cloud and we expect machine learning to grow exponentially across the retail, manufacturing and health care sectors, in particular.

This growth will be driven by three factors: broader access to machine learning, massive computing power connecting systems and services, and the explosion of online data. These developments create more opportunities for organizations to use machine learning for data-driven decision making.

Pier 1 Imports is an example of a company leveraging machine learning to deliver business impact. Using Azure Machine Learning with partner MAX451, Pier 1 Imports can determine—with 56 percent accuracy—what category of product a customer is most likely to purchase next. They can also predict the likelihood of a customer purchasing a product from any of their merchandise categories, based on e-commerce data as well as brick and mortar store data.

Last year, I shared what I saw as the top enterprise technology trends in 2014 based on the conversations I had with customers around the globe. Looking back on 2014, it’s exciting to see how widely those trends were embraced and the business results they helped our customers achieve. While we’ve engaged with our customers about IoT, security and machine learning in the past, we’re predicting 2015 will see a dramatic uptick in the maturation and adoption of these technologies, offering businesses of all sizes unique growth opportunities and competitive edge.