The Internet of Things (IoT) is at the most basic level TCP/IP on everything. If that still doesn’t help don’t worry – basically, IoT is the idea that common objects which don’t already have a connection to the web will have one soon. This is already being seen in shoes that track runners to the (currently a gimmick) fridges connected to the web.
In the past couple of years the IoT has really taken off and more companies are getting into the space. Over at TechCrunch (which popularized a lot of web2.0 stuff) has a great image and article on the current IoT space.
The concept of the Internet of Things is not new (the term itself was coined in 1999), but it is now in the process of becoming a reality thanks to the confluence of several key factors.
First, while still challenging, it is easier and cheaper than ever to produce hardware – some components are open sourced (e.g. Arduino microcontrollers); 3D printing helps with rapid prototyping; specialized providers like Dragon Innovation and PCH can handle key parts of the production process, and emerging marketplaces such as Grand St. help with distribution. Crowdfunding sites like Kickstarter or Indiegogo considerably de-risk the early phase of creating hardware by establishing market demand and providing financing.