The future of computing is at a crossroads.

As our understanding of the Internet of Things (IoT) and the power of embedded computing reaches beyond wearables and home automation, something bigger is emerging. But since these points in time don’t come along too often, it’s critical to consider the possible outcomes.

A Possible Default: Centralization

IoT centralization is simply the reliance of devices upon a central authority in order to operate. This could be as simple as a device needing to connect to a server in order to operate, or as complex as X.509 public key certificate authorities.

There are a lot of platforms and standards available today for the Internet of Things. Most of these platforms attempt to describe a high-level topology of billions of devices becoming smart and connected. Cloud computing has been nothing short of transformative, and it’s given rise to entire new fields such as predictive analytics, machine learning, and collective intelligence. Cisco estimates there were approximately 8.7 billion devices connected to the Internet in 2012, and expects that the number of connected devices could reach up to 40 billion by 2020.

Whether or not that number is correct, there will be so many devices connected that it can be argued whether the cloud will be able to keep up with it. Centralization is certainly an easier way to build out these platforms. However, the authorities in these topologies all have an influence upon the network and can be exploited. The larger a network gets, the more an incentive for bad actors.

If companies build infrastructure and data networks optimized solely for their organization, we will end up with billions of devices stuck in vertical silos bound only by corporate interests.

Also, regardless of your position on the Snowden revelations around the NSA spying on US citizens, Facebook doing psychological research on unsuspecting users, or the myriad other expectations of trust that have been breached, one thing is clear. Over time, organizations will operate to maximize their own gain. It seems to be a law of human nature. Knowing this, does it make sense to build a new Internet of Things ecosystem with such heavy influence at the central authorities?

The Alternative: Decentralization

We at Filament are proposing a fully decentralized Internet of Things ecosystem that operates independently of a central authority.

Imagine a future where devices have the autonomy to discover other devices, connect directly to them in a secure manner, and establish trust with them through contractual agreements. There is an adjacent possibility where a device not only interacts with others, but transacts value; where devices can pay each other directly for access to sensor data or to make something happen.

There’s a strong argument to be made that you gain efficiency if you push as much logic as possible to the edge of the network. When devices can communicate directly with each other — with or without the cloud — a notion of emergent behavior begins to arise. Much like insect colonies and plant roots, decentralized network structures with a few simple rules can provide for very complex systems to emerge. But these systems cannot emerge if artificial barriers exist that prevent the free flow of connectivity.

Even more importantly, we argue there is more value in a decentralized system than a silo’ed system. A controversial statement perhaps, when essentially what’s being claimed is that this system could be worth more than Facebook, or Google, or even Apple. But it’s true. A truly distributed system of billions of devices — each independently interacting and transacting value with each other — will create such a massive opportunity of new business models, it will dwarf the giants of today.

What we Learned from the Internet

During the earliest days of the Internet, there were very few centralized authorities in the network. In fact, the network itself was designed specifically against this to ensure the network would continue to operate with failed nodes. Except for the Domain Name System — which has 13 root servers, nearly the rest of the core infrastructure of the Internet operates in essentially a decentralized fashion.

Moving from the Internet days to the early World Wide Web continued this pattern. Any web site could link to any other web site, without permission, payment, or other limitation. Furthermore, web sites could be hosted on any capable server connected to the Internet, regardless of physical location or corporate structure. Call it democratization, call it an equalization, but it was the great “flattening” of the ability to read and publish data.

Then once we moved into the Web 2.0 era, we started to see a tendency of servers becoming consolidated into larger applications. Wordpress allowed anyone to host their own blogs — YouTube, their own videos — Flickr, their own photos. Entire new use-cases were built upon open, non-siloed standards such as IP, TCP, and HTTP, but some of these upper applications began to consolidate. What we’re seeing now are efforts by some to proprietize “down the stack” in a similar fashion, where lower levels of the IoT platform become less open. Efforts to build silos, where there is lock-in by end-users to one particular platform, adding artificial difficulty in preventing the migration to alternatives.

How We Get There

Enabling a decentralized Internet of Things is a hard problem to solve. We have difficult work ahead with identity management, security, discoverability, digital trust, long-range wireless networks that span hundreds of miles, low-power systems, and integrating crypto-currencies.

At Filament, we are building a platform that operates in distributed environments; removing the need for a “cloud”, or central network authority. Our devices, called Taps, are designed to operate without existing cellular or Wi-Fi networks, and will be able to independently process bitcoin-based payments and enforce digital smart contracts .

When we started Pinoccio (the name of our company before rebranding to Filament), we thought many people would want to build their own mesh networks. We thought millions of people would build their own projects, products, and companies, using our hardware. Through a series of setbacks, revelations, and talking with hundreds of customers, partners, and mentors — we realized something even bigger was emerging in our midst. Something massive, in fact. We had bumped into the tip of the iceberg of what the future of the Internet of Things could be.

Why now?

Recent developments in lithium battery technology, along with what Chris Anderson calls the peace dividend of the smartphone wars, has given rise to cheap, powerful, and highly efficient hardware technology. Because there now exists sensors that can track 9 axes of motion for under $2.50, no end in sight to promising battery technologies, and unlicensed-band radio transceivers that can transmit nearly 10 miles, it has finally become feasible to begin to think of these connected systems less as “sensor networks”, and more as a generalized digital coupling between the physical and digital realms.

Our team always embraced a core ethos of decentralization, but it wasn’t until some key progress had been made within the Bitcoin and distributed consensus algorithm (a.k.a. blockchain) communities that this could really be correctly tackled. Then the IBM ADEPT project emerged, and we realized that they had a similar vision to us in regards to what a decentralized IoT future could look like.

Why Filament?

Quite frankly, because nobody else was building the future we bumped into, and we were now envisioning.

Jeremie Miller, Filament’s CTO, has a rich history in the decentralized and distributed computing world. He authored the XMPP protocol and later founded the instant messaging company Jabber. To put into perspective the impact Jabber had on the world 15 years ago — at the time AOL had a 52% marketshare in instant messaging usage with its AIM product. Jabber was created to break the monopolistic back of AOL, and allow anyone to run their own instant messaging servers. One report states that AOL now has less than 1% market penetration, while it wast estimated that XMPP was used by over 1 billion people daily while Facebook Messenger and Google Chat were both using it.

We all have a rare opportunity to leverage the best of what’s available today, to build out a different future of connected devices of tomorrow. We are humbled by the work done before us in the areas of distributed systems, real-time operating systems, and distributed consensus algorithms. And we are excited to combine these along with our own expertise in secure P2P communication to bring about a future we want to see exist.

What if we fail?

There is a parable called the “Broken Window Fallacy” that aims to describe the concept of the law of unintended consequences. Though it’s typically used in economic discussions, it’s appropriate for considering the future of the Internet of Things. To paraphrase, it goes something like the following:

A shopkeeper’s son breaks the store window. The shopkeeper spends money on fixing the window, and restores her shop to its previous state. This clearly makes the windowmaker happy, as he just gained new business. But what is unseen is that, if the shopkeeper didn’t have to spend her money on a new window — replacing something broken — then she would’ve spent it on something else, perhaps a renovation, or a new book. What isn’t seen is what the shopkeeper could have bought, had she not spent her money on a window. We’ll never know what could have been.

What’s at stake for the Internet of Things that is unseen, yet could be lost if we build it on a centralized model? It’s a difficult question to answer, but it’s clear that there is a world of new marketplaces and opportunities available if we don’t have to repair broken windows.