What is driving the Internet of Things?

Increasingly, businesses are looking to create value by linking connected devices, an IHS Markit report finds

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The industrial sector will account for half of new connected devices
The industrial sector will account for half of new connected devices
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Innovation is driving new business models and consolidation

Standardisation and security are enabling scalability

Business models are keeping pace with IoT technology

Underpinned by what is described as “lightning-fast demand” for ubiquitous connectivity, the number of connected Internet of Things (IoT) devices globally is expected to increase by 15 per cent year-over-year to 20 billion in 2017.

 

In a free new report, IoT Trend Watch 2017 from IHS Markit, its analysts have pinpointed four key trends that will drive the IoT this year and beyond. Increasingly, the report finds, businesses view the IoT as a tremendous opportunity to create unique value propositions by linking disparate systems of connected devices that range from multiscreen content sharing to smart city networks.

 

According to the report, the industrial sector -- led by building automation, industrial automation and lighting -- will account for nearly one half of new connected devices between 2015 and 2025.

 

The intelligence firm defines IoT as a “conceptual framework”, powered by the idea of embedding connectivity and intelligence into a wide range of devices.

 

“These internet-connected devices can be used to enhance communication, automate complex industrial processes and provide a wealth of information that can be processed into useful actions – all aimed at making our lives easier," said Jenalea Howell, research director, IoT connectivity and smart cities for IHS Markit.

 

The four trends identified as leading the IoT evolution in the coming years are:

 

1 Innovation and competitiveness are driving new business models and consolidation

To date, the focus on IoT monetisation has rightly revolved around the way in which suppliers earn revenue selling components, software or services to IoT application developers. Increasingly, however, the focus is shifting to the IoT developers themselves and how they will monetise new streams of data delivered by their IoT deployments.

 

2 Standardisation and security are enabling scalability

With the high growth in IoT deployments and much hype surrounding the promise of the IoT marketplace, scaling the IoT is highly dependent on two factors: first, the pace at which devices are connected and second, the ability to manage a large number of devices.

 

3 Business models are keeping pace with IoT technology

The methods used to monetise the IoT are almost as diverse as the IoT itself. Many pioneers of the IoT sold products to build it. That is still happening, of course, but now there is a shift to reaping the benefits of the data that’s been created.

 

4 Wireless technology innovation is enabling new IoT applications

Advances in wireless technologies will continue to extend the IoT at both the low- and high ends. At the low end, low-power wide-area network (LPWAN) promises low cost, low power and long range, connecting millions of devices that previously could not be unified in a practical way. At the high end, 802.11ad makes it possible to wirelessly connect very high performance applications such as 4k video.

 

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