The document discusses a cloud-based Bayesian smart agent architecture for Internet-of-Things (IoT) applications, emphasizing the transition from device-centric models to more complex, cloud-driven intelligence that enhances scalability and analytics. It highlights the benefits of using Bayesian networks for environments with incomplete data and introduces a rational agent architecture that supports various decision-making paradigms. Moreover, it presents a proposed architecture integrating software-defined sensors and actuators with the cloud to facilitate real-time decision-making in IoT applications.