1. DEVICE DEMOCRACY
Solid 2015
!
!
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IBM Institute for BusinessValue

2. © 2015 IBM Corporation
CREDITS
IBM IBV
!
Paul Brody
Veena Pureswaran
Sumbala Nair
Sanjay Pannikar
ADEPT team
!
Speaker
Henning Diedrich
2

3. ADEPT
IoT research project by IBM
3

4. © 2015 IBM Corporation
ADEPT: CES DEMO RECAP
• washer buying detergent
• washer bartering energy use
• washer ordering service
4
Retailer
Order, Payment
Confirmation
Payment
Negotiation
Detergent!
Check
TV
Price Alert
Confirmation
Service Request
Service"
Vendor
Service Checklist!
Warranty Check
Owner
ADEPT"
WASHER
Notification
1 2
3

5. © 2015 IBM Corporation
BIG PICTURE IOT
• coming massive computing power of ‘things’
• failed expectations
• market size trailing predictions
• IBM IoT Platform on Bluemix
• autonomous devices
• inter-device commerce
5

6. © 2015 IBM Corporation
ADEPT: IOT CHALLENGE FOCUS
√ cost
□ trust
√ monetisation
√ interoperability
√ discoverability
√ authentication
√ long term service expectation
□ scale
6
Lackof
Not future-proof
Lackofprivacy
Internet
of Things
Brok
en business
High
cost
m
odels
functionalvalue

7. © 2015 IBM Corporation
DEVICE OWNERSHIP OPTIONS
• manufacturer
• provider
• owner
• device
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8. © 2015 IBM Corporation
DECENTRALIZATION
8
!
device agency
device democracy
open platform
common market

9. ADEPTVISION

10. © 2015 IBM Corporation
ADEPT DESIGN
√ trust-less peer-to-peer messaging
√ distributed file sharing
√ autonomous device coordination
□ identity
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11. © 2015 IBM Corporation
ADEPTVISION
□ highly efficient digital marketplaces
√ real-time resource competition
√ inter-device agreements
√ direct payments between devices
√ service and resource barter between devices
□ inter-device reputation
!
√ = demo’ed
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12. © 2015 IBM Corporation
ADEPT DEVICE CATEGORIES
12
ADEPT Device Categories
Light&Wallet&
Messaging& File&Transfer&
Related&Peer&List&
Op7mized&Wallet&
Messaging& File&Transfer&
Related&Peer&List&
Autonomous&Device&
Coordina7on&Framework&
Data&Management&&&Analy7cs&
Transac7on&Verifica7on&
(capabilityIbased)&
Full&Wallet&
Messaging& File&Transfer&
Related&Peer&List&
Autonomous&Device&
Coordina7on&Framework&
Data&Management&&&Analy7cs&
Transac7on&Verifica7on&&
(Full)&
Marketplace&Enablers&
P.&Ex.&Marketplaces&
Implemented&as&PoC&
Proposed&
Light&Peer&
Standard&Peer&
Peer&Exchange&
37

13. © 2015 IBM Corporation
ADEPT ARCHITECTURE
(√) protocols, services, applications
√ TeleHash, BitTorrent, Ethereum
□ light peers, standard peers, hub
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ADEPT Architecture
Logical View
Devices enabled as decentralized
autonomous peers
Device communication private by
UI
Business
Messaging
LifeCycle
Message
Blockchain
LifeCycle
Transaction
File Sharing
LifeCycle
File sharing
Data
LifeCycle
Peer
Analytics
Asset
Appliance Examples Resource
Virtual Diagnosti
Data Management (e.g. MySQL & Distributed DB)
E.g. Android, Linux compatibility
Messaging
Store &
Optimized
Blockchain
Mining
File Sharing
(e.g.
Own and
Light Peer
protocol
Autonomous
Device
ADEPTInstaller
Application
Open source
Open source
Data
OS

14. ADEPT Architecture
Logical View
Devices enabled as decentralized autonomous peers
Device communication private by design
Capability to achieve distributed consensus
UI
Business Logic
Messaging
Service
LifeCycle
Message
Handler
Blockchain
Service
LifeCycle
Transaction
Handler
File Sharing
Service
LifeCycle
File sharing
Handler
Data Management Service
LifeCycle
Peer Management
Analytics
Asset
sharing
Appliance
Self-service Examples
Resource
Bartering
Virtual Credit
Management
Diagnostics
Data Management (e.g. MySQL & Distributed DB)
E.g. Android, Linux compatibility
Messaging
(e.g. Telehash)
Store &
Forward
Optimized
Blockchain
(e.g. Ethereum)
Mining
File Sharing
(e.g. BitTorrent & OBEX)
Own and
Light Peer
protocol
handler
Autonomous
DeviceCordination
Framework
ADEPTInstaller
Application
Layer
Open source
Services
Open source Protocols
Data
Layer
OS
Interface

15. © 2015 IBM Corporation
ADEPT DEVICE SECURITY
AND MAINTENANCE
• automatic and secure software updates
• verification of trustworthiness of peers
• self-maintaining, self-servicing units
15

16. © 2015 IBM Corporation|
/
Use Case 1: The Autonomous Washer
Autonomous transactions between Washer,
Retailer, After Sales Service and other appliances.
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Retailer
Order, Payment
Confirmation
Payment
Negotiation
Detergent!
Check
TV
Price Alert
ConfirmationService Request
Service"
Vendor
Service Checklist!
Warranty Check
Owner
ADEPT"
WASHER
Notification
1 2
3
Consumables Marketplace1
2
3
Service Marketplace
Energy Marketplace
Use Case Scenarios:

17. © 2015 IBM Corporation|
Interactions – Detergent reorder
Trigger:
Detergent falls below re-order level
Make payment against existing contract.
!
Features demonstrated
Consumables analytics
Policy to invoke payment contract
Secure point to point messaging
Ethereum Payment()
Telehash
Create order()
Telehash
Dispatch confirmation ()
Notify owner()
Notify owner()
1
2
2
3
4
4
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Authorized
Retailer
Authorized
Retailer

18. © 2015 IBM Corporation|18
Interactions – component in-warranty replacement
If In warranty, raise telehash
Replacement Order()
If in warranty, Telehash
Service order confirm ()
Notify owner()
Notify owner()
Verify warranty
status()
1
5 4
2
3 3
5
Trigger:
Washer detects potential air filter failure.
Find authorized service center.
!
Internet discovery
In device analytics
Block chain verification
Secure point to point messaging
Check warranty status()

19. BLOCKCHAIN
Why Blockchain?

20. © 2015 IBM Corporation
WHAT IS A BLOCKCHAIN?
!
• trust-less network
• signed transactions
• public consensus
• transaction code
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21. © 2015 IBM Corporation
SMART CONTRACTS
• transaction scripts
• on- or off-chain
• transacting value-holding token
• micro-fee capability
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22. © 2015 IBM Corporation
BLOCKCHAIN CHALLENGES
privacy
scaling
mining
finality
volatility
legality
stability
22

23. © 2015 IBM Corporation
• Bitcoin limited smart contracts
• Ethereum not ready
• Ripple not decentralized
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24. THE CLOUD
as peer

25. © 2015 IBM Corporation
CLOUD AND ADEPT
• hash key in the chain
• content in key-value* store like Cloudant
• scaling platform like Softlayer
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26. © 2015 IBM Corporation
CLOUD AS PEER
Cloud as State-Holder
• cost efficient
• unlimited capacity
• elastic scale
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Cloud as Code-Repository
• light protocol
• fast execution
• out-of-band validation

27. ONGOING DEVELOPMENTS

28. © 2015 IBM Corporation
CURRENT RESEARCH
• Consensus implementations
• Performance scaling vs centralized solutions
• Energy cost of proof of stake vs. proof of work
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29. © 2015 IBM Corporation
CONSENSUS IMPLEMENTATIONS
• Proof of Work
• Proof of Stake
• Traditional Consensus Protocols
29

30. © 2015 IBM Corporation
PERFORMANCE SCALINGVS
CENTRALIZED SOLUTIONS
Performance for decentralized and
centralized models with increasing
network size for downloading a 100
MB file, with Kademlia messages
generated between any random pair
of nodes at an interval of 30 ms.
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31. © 2015 IBM Corporation
ENERGY COST
31
Power&Consump-on:&PoS&v/s&PoW
• 2"device"types""
• GPU_dev:""
• Radeon"R9"290X"
• Idle"power:"20W"
• Stressed"power:"308W"
• Intel"BaseAT"NIC"
• Idle"power:"21.2W"
• AcHve"power:"21.4W"
• CPU_dev:""
• Intel"PenHum"4"540"processor""
• Idle"power:"150W"
• Stressed"power:"223W"
• Intel"BaseAT"NIC"
• Idle"power:"21.2W"
• AcHve"power:"21.4W"
"
• 1000"devices"
• 100"miners,"900"nonAminers"
• 1"blockchain,"12s"blockAHme"
• Nature"of"traffic"
• SimulaHon"run"for"12,000"seconds"(1000"block"Hmes)"
• On"average,"an"event"happens"every"0.25s"
• Event"is"either"publish_contract,"call_contract,"or"
send_money."Each"happens"with"equal"probability."
• Up"to"41%"less"power"consumed"by"PoS"than"
PoW."This"is"in"the"all"GPU"case."
0"
20"
40"
60"
80"
100"
120"
140"
160"
180"
200"
0" 0.25" 0.5" 0.75" 1"
Avg."Power"Consumed"
FracHon"of"GPU"devices"
Total"PoS" Total"PoW"

32. © 2015 IBM Corporation
ENERGY COST
32
• 1000#Raspberry#Pi s##
• 100#miners,#900#non3miners#
• 12s#block38me#
• Simula8on#run#for#12,000s#
• Choice#of#consensus#mechanism#ma>ers#–#
but#not#so#much#for#low#power#devices#
• PoW#consumes#less#than#6%#more#energy#
than#PoS#
• Energy#consumed#by#PoS#consensus#
mechanism#is#close#to#devices#opera8ng#in#
idle#mode#

33. © 2015 IBM Corporation
BLOCKCHAIN SIZE
33
Size%of%the%Add,only%Block,chain
0"
200"
400"
600"
800"
1000"
1200"
1" 7" 13" 19" 25" 31" 37" 43" 49" 55" 61" 67" 73" 79" 85" 91" 97"103"109"115"121"127"133"139"145"151"157"163"169"175"181"187"193"199"205"211"217"223"229"235"241"247"253"259"265"271"277"283"289"
Size"of"Blockchain"(MB)"
Time"(Hours)"
100"tps" 50"tps" 25"tps" 10"tps"
• This"chart"emphasizes"the"need"for"block"chain"pruning."
• A"device"with"1GB"memory"would"run"out"of"memory"fairly"quickly."""
Time"of"crash"
Time"of"crash"
Time"of"crash"
Time"of"crash"

34. © 2015 IBM Corporation
OTHERS’ EFFORTS
• Samsung
• Filament
• 21
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35. © 2015 IBM Corporation
FILAMENT
35

36. © 2015 IBM Corporation
FILAMENT
TeleHash
Bitcoin mainnet
Blockname DNS
JOSE off-chain code
Pennybank microtransactions
36

37. SUMMARY & OUTLOOK

38. © 2015 IBM Corporation
WHAT WE'VE LEARNED
• concept works
• much left to do
• blockchain works as advertised
• smart contracts are a powerful new paradigm
• machine-to-machine commerce works
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39. © 2015 IBM Corporation
WHAT WE DON'T KNOWYET
• scaling
• privacy
• consensus algorithm
39

40. © 2015 IBM Corporation
PRODUCTS AS SUBSCRIBED EXPERIENCE
• empowering the sharing economy
• subscription, not purchase
• full life time full service
40
Instrumented
Intelligent
Invisible
Interactive
Interconnected

41. © 2015 IBM Corporation
BUILDING AN
OPEN DEVICE
ECOSYSTEM
!
Charge to the industry
41
p
Registration
of new
device
Authentication
of remote
users
Contract to barter
power with other
appliances
Checklist for
automobile
safety