What is Internet of Things (IoT)?
The Internet of Things represents a vision in which the Internet extends into the real world embracing everyday objects. Physical items are no longer disconnected from the virtual world, but can be controlled remotely and can act as physical access points to Internet services. The Internet of Things vision is grounded in the belief that the steady advances in microelectronics, communications and information technology we have witnessed in recent years will continue into the foreseeable future.
“Smart” objects play a key role in the Internet of Things vision, since embedded communication and information technology have the potential to revolutionize the utility of these objects. Using sensors, they are able to perceive their context, and via built-in networking capabilities they would be able to communicate with each other, access Internet services and interact with people.
All „Things“ connected
The digital world is expanding rapidly, doubling in size every two years according to a recent report from IDC (The International Data Corporation) and EMC (Digital Universe Study). More and more data are being generated extremely from the ever-expanding number of connected devices, i.e. “things” – from washing machines, refrigerators, and microwaves to cars and thermostats – expected to account for 10% of the 44 trillion gigabyte digital universe by the year 2020.
We are still early in the adoption of the IoT and the disruption in its truest sense is yet to be witnessed. However, economic and technological barriers are receding, and with the increase of connected devices and evolving analytics capabilities, the possibilities for IoT seem limitless.
However, with lots of advantages of the IoT, comes also a range of both benefits and concerns – improved connectivity and communication between humans and things brings increased concerns over privacy, data security and regulation. While the opportunities for IoT are great, significant challenges still remain. IoT implementations are complex, given the need to connect with the cloud, manage and analyze data in a secure way, and integrate with existing infrastructure.
One of the biggest challenges behind IoT is to transform this huge amount of generated, raw data into valuable knowledge.
“I firmly believe that the EU Commission will continue to support research in IoT in Horizon 2020, the forthcoming EU research and innovation framework programme starting in 2014”
Global Market Value of $1.9 Trillion by 2020
According to Frost & Sullivan’s, Milroy says the “explosion” of Internet of Things over the next few years will be driven by “the nexus of low-cost sensors, cloud computing, advanced data analytics and mobility.” Transportation and logistics represent the biggest revenue opportunities today for an Internet of Things ecosystem, she adds. “The deployment of low-cost, IP -enabled sensors within things that move products around and operate within the actual products opens vast opportunities far beyond just the supply chain optimization.
There are gains to be made in many industries such as transportation, healthcare, pharmaceuticals, manufacturing, energy management, facility management, security and surveillance, utilities, telecom, finance, insurance and many more. Basically, every sector in every system will be part of the connected world.”
Gartner predicted that the global economic value of IoT will be $1.9 trillion by 2020. IDC estimates that devices connected to the Internet will generate nearly $9 trillion in annual sales by 2020.
Example of IoT implementation in Transportation
The Internet of Things can be used by public transportation systems to automate a variety of tasks for both riders and employees. Bus operators can see their position in route, ticket sales, camera and more. They can control music and video. The system also allows for location-based advertising. And bus riders – how about a text a few minutes before the bus arrives or an ad for a nearby shopping center on your way home from work.
IDC describes the IoT as a network connecting – either wired or wireless – devices (things) that is characterized by automatic provisioning, management, and monitoring. It is innately analytical and integrated, and includes not just intelligent systems and devices, but connectivity enablement, platforms for device, network and application enablement, analytics and social business, and applications and vertical industry solutions. It is more than traditional machine-to-machine communication.
Indeed, it is more than the traditional Information and Communications Technology (ICT) industry itself.
The Internet of Things Is Redefining Enterprise IT
The Internet of Things (IoT) is changing the business playing field, creating opportunities for
new sources of revenue, smarter interactions with customers, and greater efficiencies. Yet IoT introduces new technical challenges. How do you securely connect intelligent devices via the Internet to your enterprise, capture data at the “point of action,” and analyze huge volumes of machine-generated data in real time?
The Internet of Things will be one of the most disruptive technology trends of the next decade, with sweeping implications for businesses and policymakers.
„The real promise of the Internet of Things lies in the ability to combine machine-generated data with data created by humans for deeper insight, understanding, and real-time decision making.“
Opportunities and Challenges of Connecting Your Business to the Internet of Things
Opportunities:
o Create and Deliver new experiences for customers – offer new services, enhance existing products and build entirely new ways of doing business.
o Cost reduction and efficiency – The right combination of connected devices, infrastructure, data analytics, and processing – specific to the industry – can help companies reduce costs incurred due to operational inefficiencies – such as delays in response time, waste of assets, process inaccuracies and loss due to human error. One can take advantage of the almost boundless potential provided by the mass quantities of data produced in IoT transactions and making it valuable through advanced analytics.
o Risk management – Enterprises are exposed to risk in the physical and virtual security of assets and data, the physical safety of workers – especially those deployed in the field. With connected devices and the organization of data, business can now take informed decisions to better manage risk associated with being open for business.
o Opportunity in revenue growth and innovation – Nearly three-fourths of enterprises who express interest in adopting IoT solutions are looking for new business opportunities and ways to fortify existing products.
Challenges
o Concerns on Security and interoperability – make CIOs unsure of the economic rewards relative to the risks of implementing IoT solutions. Consumer-facing functions are more vulnerable to risk related to breach of privacy security concerns.
o No clarity on ROI – IoT providers (of hardware infrastructure, software, communications, and devices) have yet to articulate compelling propositions for how IoT solutions can drive lasting economic value for the enterprise
Peek at the Future
The Internet of Things – simply thought of as “the extension of the Internet to the physical world”– will reshape the way business is done across every sector of the economy and every industry. It will bring previously offline businesses and processes online.
It will redefine companies’ entire business models, their relationships with their customers, and the structures of their organizations.
The Internet of Things is the next big thing. It offers businesses the opportunity to develop new services, improve real-time decision making, solve critical problems, and develop new end-user experiences. IoT is driving a world of increasingly connected devices, seamless connectivity from sensors to the data center, cloud economics for computing and data, and the acceleration of big data analytics. This sounds great, but how does this relate to your business? Or to your existing and legacy infrastructure?
How can IoT solutions be deployed efficiently? And what are some real life examples to learn from?
