Arising Internet of Everything: Business Modeling and Architecture for Smart Cities

The Internet has evolved into a global marketplace where information about literally every existing
product or service can be found. Smart devices and cyber-physical systems, which are interconnected
to IT systems and services, form the basis for the arising Internet of Everything, opening up new
economic opportunities for its participants and users beyond its technological aspects and challenges.
While today’s e-business scenarios are mostly dominated by a few centralized online platforms, future
business models, which will be feasible for the Internet of Everything, need to address special
requirements. At present, the amount of data, as well as the sum of available products and services in
conjunction with possible customizations already overstrain users in search for their optimal choice.
This leads to a decision making process according to the principle of adverse selection. Such
business models, e.g., leveraging the possibilities of smart cities, need to cope with arbitrary
combinations of products and services orchestrated into complex products in a highly distributed and
dynamic environment. Furthermore, these arbitrary combinations are influenced by real-time context
information derived from sensor networks or IT systems, as well as the users’ requirements and
preferences. The complexity of finding the optimal product/service combination overstrains users and
leads to decisions according to the principle of adverse selection (i.e., choosing good enough instead
of optimal). Such e-business models require an appropriate underlying value generation architecture
that supports users in this process. In this chapter, we develop a business model that addresses
these problems. In addition, we present the Distributed Market Spaces (DMS) software-system
architecture as a possible implementation, which enables the aforementioned decentralized and
context-centric e-business scenario and leverages the commercial possibilities of smart cities.