The Internet of Things (IoT), like Big Data, is expected to drive the next wave of high-tech growth – including electronic components. "The explosion of IoT activity over the next few years will be driven by the nexus of low cost sensors,” according to Andrew Milroy, Vice President, ICT Practice, Frost & Sullivan Asia Pacific, in a press release, “as well as cloud computing, advanced data analytics and mobility."
The IoT will create much more data than is currently generated by people. Powerful analytics tools will allow this additional data to be optimized, potentially allowing organizations to increase efficiency and effectiveness, innovate and transform the way they do business -- and as a result, generate revenue. As organizations prioritize big data and seek to improve evidence-based decision making, demand for these tools will increase.
"Numerous opportunities will emerge as more and more data is generated by machines ('things') than human beings,” Milroy added, “such as to analyses and use vast amounts of data, to store data and source application functionality in/from the cloud, to create, manage and support apps that enable the operation and management of IoT implementations and to provide high speed connectivity between objects and the people, who work with them and use them."
New cloud opportunities will be driven by the IoT, as most organizations in mature economies need to justify not using cloud computing as opposed to on premise alternatives. Cloud computing opportunities will multiply as the IoT becomes more widespread. For instance, data generated by low cost sensors will be stored and analyzed in the cloud. Applications which drive the functionality of sensors and other mobile devices will be hosted and developed in the cloud.
The IoT role with mobility, high speed networks and App development
With smartphone penetration surpassing 50% in many economies, businesses are constantly finding ways to engage customers directly on their smartphones. With the IoT, mobile application or 'apps' will be developed in the cloud for deployment on any device or sensor. Platforms that allow this app development will become more widely used and leading technology vendors, such as Salesforce.com, Microsoft, VMWare, Amazon and Google, will battle for dominance. A professional services market centered around development and management of apps will become increasingly significant in 2014.
Milroy adds, "Apps will become the primary form of engagement with organizations as people will increasingly look to apps that allow them to interact with their bank, airline, favorite retailer or restaurant. While apps may enable and enhance that interaction, high speed networks will need to be deployed to enable this heavy use of increasingly sophisticated apps. From an IoT perspective, these networks will be necessary to efficiently transmit growing volumes of data between sensors and devices."
Specific IoT Opportunities
The biggest revenue opportunity today for an IoT ecosystem is within the transportation and logistics sectors. The deployment of low cost IP enabled sensors within 'things' that move products around as well as within the products themselves creates huge opportunities beyond supply chain optimization. For example, the Airbus A380's has components fitted with sensors to monitor 'wear and tear' in real time. This continually generated data allows Airbus to maintain a dynamic maintenance process and optimize performance. From a technology perspective, this requires a huge amount of storage and application functionality, as well as data analysis. Cloud computing, big data technologies and lower cost sensors will definitely have a positive impact on aircraft manufacturers and airlines.
Smart cities, connected cars, connected health and manufacturing are also transforming as a result of the IoT. Developments that have huge implications on the way manufacturing plants are designed, operated and maintained include the monitoring and management of machinery from mobile devices and specialized machinery such as drills monitored by sensors, enabling manufacturers to replace expensive machinery based on usage rather than on the machine installation time.
Key IoT Challenges
As the IoT is heavily dependent on cloud computing, high speed connectivity and powerful data analysis tools, issues with reliable connectivity, enterprise grade cloud computing and performance have to be addressed before the full potential of IoT can be realized.
As more machines operate independently of people, potential risks associated with security breaches multiply. Hacking a self-driving car or an aircraft navigation system could have devastating consequences. Technology vendors must continually ensure that the IoT technology is secure and processes are in place to address attempted security breaches.
"Although an increasing number of 'things' will be IP enabled, it remains important that standards emerge, as 'things' may not be able to communicate with each other and the people that engage with them. There remains a risk of an 'Internet of Silos'," stressed Milroy.
As the cloud, data analytics, mobility and connectivity technologies mature, the IoT will open up enormous new opportunities across industries. Activities that were once the domain of specialized industry vendors will open to the world's leading technology firms. Technology vendors will place much greater focus on industry specific activities as they seek to fully benefit from the IoT and connected industries.