The Internet of Things, or IoT, refers to the billions of physical devices around the world that are now connected to the internet, collecting and sharing data. Thanks to cheap processors and wireless networks, it’s possible to turn anything, from a pill to an aeroplane to a self-driving car into part of the IoT. This adds a level of digital intelligence to devices that would be otherwise dumb, enabling them to communicate real-time data without a human being involved, effectively merging the digital and physical worlds.
What are the benefits of the Internet of Things for business?
The benefits of the IoT for business depend on the particular implementation, but the key is that enterprises should have access to more data about their own products and their own internal systems, and a greater ability to make changes as a result.
Manufacturers are adding sensors to the components of their products so that they can transmit back data about how they are performing. This can help companies spot when a component is likely to fail and to swap it out before it causes damage. Companies can also use the data generated by these sensors to make their systems and their supply chains more efficient, because they will have much more accurate data about what’s really going on.
“With the introduction of comprehensive, real-time data collection and analysis, production systems can become dramatically more responsive,” say consultants McKinsey.
Enterprise use of the IoT can be divided into two segments: industry-specific offerings like sensors in a generating plant or real-time location devices for healthcare; and IoT devices that can be used in all industries, like smart air conditioning or security systems.
While industry-specific products will make the early running, by 2020 Gartner predicts that cross-industry devices will reach 4.4 billion units, while vertical-specific devices will amount to 3.2 billion units. Consumers purchase more devices, but businesses spend more: the analyst group said that while consumer spending on IoT devices was around $725bn last year, businesses spending on IoT hit $964bn. By 2020, business and consumer spending on IoT hardware will hit nearly $3tn.
For IDC the three industries that are expected to spend the most on IoT in 2018 are manufacturing ($189bn), transportation ($85bn), and utilities ($73bn). Manufacturers will largely focus on improving the efficiency of their processes and asset tracking, while two-thirds of IoT spending by transport will go toward freight monitoring, followed by fleet management.
IoT spending in the utilities industry will be dominated by smart grids for electricity, gas, and water. IDC puts spending on cross-industry IoT areas like connected vehicles and smart buildings, at nearly $92bn in 2018.
What is the Industrial Internet of Things?
The Industrial Internet of Things (IIoT) or the fourth industrial revolution or Industry 4.0 are all names given to the use of IoT technology in a business setting. The concept is the same as for the consumer IoT; to use a combination of sensors, wireless networks, big data and analytics to measure and optimise industrial processes.
If introduced across an entire supply chain rather than just individual companies the impact could be even greater with just-in-time delivery of materials and the management of production from start to finish. Increasing workforce productivity or cost savings two potential aims, but the IIoT can also create new revenue streams for businesses; rather than just selling a standalone product for example like an engine, manufacturers can sell predictive maintenance of the engine too.
Internet of Things and big data analytics
The IoT generates vast amounts of data: from sensors attached to machine parts or environment sensors, or the words we shout at our smart speakers. That means the IoT is a significant driver of big data analytics projects because it allows companies to create vast data sets and analyse them. Giving a manufacturer vast amounts of data about how its components behave in real-world situations can help them to make improvements much more rapidly, while data culled from sensors around a city could help planners make traffic flow more efficiently.
In particular, the IoT will deliver large amounts of real-time data. Cisco calculates that machine-to machine connections that support IoT applications will account for more than half of the total 27.1 billion devices and connections, and will account for five percent of global IP traffic by 2021.
The Internet of Things and smart cities
By spreading a vast number of sensors over a town or city, planners can get a better idea of what’s really happening, in real time. As a result, smart cities projects are a key feature of the IoT. Cities already generate large amounts of data (from security cameras and environmental sensors) and already contain big infrastructure networks (like those controlling traffic lights). IoT projects aim to connect these up, and then add further intelligence into the system.
There are plans to blanket Spain’s Balearic Islands with half a million sensors and turn it into a lab for IoT projects, for example. One scheme could involve the regional social-services department using the sensors to help the elderly, while another could identify if a beach has become too crowded and offer alternatives to swimmers. In another example, AT&T is launching a service to monitor infrastructure such as bridges, roadways, and railways with LTE-enabled sensors to monitor structural changes such as cracks and tilts.
The ability to better understand how a city is functioning should allow planners to make changes and monitor how this improves residents’ lives.
Big tech companies see smart cities projects as a potentially huge area, and many — including mobile operators and networking companies — are now positioning themselves to get involved.
IoT data and artificial intelligence
IoT devices generate vast amounts of data; that might be information about an engine’s temperature or whether a door is open or closed or the reading from a smart meter. All this IoT data has to be collected, stored and analysed. One way companies are making the most of this data is to feed it into artificial intelligence (AI) systems which will take that IoT data and use it to make predictions.
For example, Google is an AI in charge of its data center cooling system. The AI uses data pulled from thousands of IoT sensors which is fed into deep neural networks, which predict how different choices will affect future energy consumption. By using machine learning and AI Google has been able to make its data centers more efficient and said the same technology could have uses in other industrial settings.