Last week, one of the world’s most prestigious publications, the Oxford English Dictionary, finally added the phrase “Internet of Things”, alongside other terms SiliconANGLE readers will be familiar with, such as Big Data, Crowdsourcing, e-reader, mouseover, stream (the verb) and redirect (a noun).

But where does the Internet of Things come from, and why is it suddenly so important that it graces the hallowed pages of the English language’s most definitive, most trusted source? Simply because, its no longer a concept of the future, but something that’s here right now – and in the very, very close future, it’s going to alter our lives in numerous ways.

The basic concept of the Internet of Things is that by making ‘things’ connected, we can extend the benefits of the internet to everything. Constantly being connected means we can control things remotely, share date anytime and anywhere – with devices, gadgets and objects in the real world. Electronics, home appliances, smart cars, collectibles, even shampoo, can all be tied into a global network and “always on”.

To make the Internet of Things a reality, we need to find a way for ‘things’ to interface with the web, and that means they must all possess some way of connecting. The usual way is through a technology called RFID (radio frequency identification) chips, although alternative means do exist – such as Wi-Fi, Bluetooth, and even barcodes and QR codes.

RFID chips were first developed by researchers at the Auto-ID Center at the Massachusetts Institute of Technology in 1999, which was co-founded by the UK technology pioneer Kevin Ashton, the man who first coined the term “Internet of Things”. However, the concept of RFID actually grew out of earlier iterations that date back to the 1970s. Previously, Ashton worked at Procter & Gamble, and realized that RFID could be used to help keep track of the company’s massive product inventory – the idea caught on to the point where today, many companies use RFID chips to keep track of their products. They’re also used in bio-metric passports, and for many other uses, such as by farmers to keep track of their cattle.

The global RFID chip market was worth an estimated $6.37 billion in 2011, according to RFID Canada, and that figure is expected to hit $20 bullion by 2014. By 2020, ABI Research expects there to be more than 30 billion devices that make up the Internet of Things.

IoT Makes The World Go Round

The benefits of all this connectivity will be felt across the entire world. Helen Duce, director of the RFID Technology Auto-ID European Centre at the University of Cambridge, is one of the Internet of Thing’s biggest proponents and argues that it will boost efficiency across numerous industries – shops for example, will never run out of stock again, as inventories become automated to ensure packs of chewing gum and bottles of beer are ordered as soon as they’re needed. Consumers will also be able to benefit, whether its smart cars that can drive themselves or prevent you from getting caught up in traffic, to smart homes where the fridge is capable of ordering fresh milk from the store, and where your lights will turn themsleves on and off as you move from room to room.

“We have a clear vision—to create a world where every object—from jumbo jets to sewing needles—is linked to the Internet,” wrote Duce recently.

What About The Risks?

The benefits are compelling enough, but what about the risks that all of this connectedness entails? While the US military and the CIA will probably do a good enough job of keeping their systems away from the prying eyes of hackers, other things will be less secure. What chance your neighbor turns your fridge against you? Or perhaps, tries to bump you off by exploding your pacemaker?

There’s also attacks on infrastructure to worry about, as outgoing Homeland Security chief Janet Napolitano recently warned. In 2008, the U.S. National Intelligence Council warned that it would be almost impossible to deny enemies and mischief makers access to “networks of sensors and remotely controlled objects,” whilst noting that its also unclear what kind of data from the Internet of Things law enforcement should have access to, and what should be considered out of bounds.

According to Loraine Lawson in ITBusinessEdge, much of the responsibility for protecting the Internet of Things will fall on the shoulders of computer programmers, who’ll have to contend with billions of networked devices. Patches and updates will be difficult, while it’ll become much more difficult to extract signals from the noise the IoT generates.

Lawson says that the most likely solution will be found in the form of smart, stable software that doesn’t cause too much of a drain on processing power, but that could be a few years away.

“In short, the IoT (Internet of things) may cause a lot of headaches, but it could also prove to be very transformative for organizations,” wrote Lawson.