https://www.excelacom.com/resources/blog/is-the-iot-here-to-stay-get-the-facts/

Aug 31, 2016

Is the IoT Here to Stay? Get the Facts

By James Comfort

Ever been worried about your home or a loved one when you're not around? We all have. In today's rapidly transforming digital world, you can remotely monitor and manage what matters most: home appliances, family, your front door, air quality levels, health and wellness— almost anything you want.

All this is possible because of the Internet of Things (IoT). IoT is defined as a system of interrelated, virtually connected devices that are capable of collecting and exchanging data over a network without any human-computer interaction.

We are seeing IoT adoption in numerous industries throughout the world. IoT is our future. It has the opportunity to significantly enhance the lives of consumers, in addition to providing an additional stream of revenue for businesses around the world. In fact, Gartner predicts IoT will generate revenues exceeding $300 billion by 2020! Communication and Media providers are in the center, driving this connectivity. Therefore, it is crucial for providers to invest now, enable new services across various industries and build partnerships that help minimize the risk and test innovations.

Connectivity is the underpinning of the Internet of Things (IoT) ecosystem, a market that Gartner predicts will generate large revenues. Since providers run the ecosystem for IoT connectivity, they have a huge opportunity to be in the driver's seat by tapping into a number of markets to significantly increase revenues. With solid partnerships and an effective IoT strategy, providers can own and monetize these ecosystems. To do so is not an easy process and it won't deliver quick results. Service providers face a number of business, operations and technical challenges to find success in the IoT.

Business Challenges

  • Overall Strategy – Lack of clarity in ecosystem (too many players)
  • Business Model Transformation – Must adapt to a more agile business practices to keep up
  • Partnerships – Tough to find the right partners with proven expertise
  • Monetizing Data – Unlock the value in data accumulated in the IoT world in real-time
  • Skilled Workforce – Need the right people to deliver the right solutions

Technology Challenges

  • Entering Vertical Markets – Devise end-to-end solutions and connectivity
  • Legacy and Modernized Systems – Aging systems vs. upgrades and migrations
  • New IoT Standards – Introduce standards to optimize communication between devices
  • Creating Modular and Reusable Solutions – Need solutions that are flexible and reusable
  • Network Upgrades – Infrastructure upgrades for additional bandwidth

Operational Challenges

  • Managing Device Diversity – Managing all the difference types of IoT devices
  • Designing Pricing Models – Creating new models, service catalogs and operation support processes for IoT service delivery
  • Managing Transactions – Managing the trillions of transactions in real-time

Providers can overcome all three of these overarching challenges by partnering with a proven IoT expert and capitalizing on Big Data and IoT analytics. This is a multi-billion dollar market opportunity for providers and the world is relying on service providers to light the way. They are in a strategic position and it's their time to shine.

9 Industries Incorporating IoT

So where is the market boom expected to come from? There are nine key industries that are incorporating IoT where service providers have big opportunities.

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Residential

Over the last few years, homeowners have been making the transition to home automation so they can constantly monitor and manage their home. IoT helps homeowners manage their appliances, thermostats, lighting, entertainment, safety and more. These "smart homes" are helping homeowners become more efficient and informed, ultimately saving money on monthly household bills and keeping an eye on pets and family.

Retail

Retailers are constantly being challenged to improve their customer experience. IoT can help retailers more quickly and efficiently satisfy and meet the growing needs of their customers.

  • FACT 3: Target is testing robot employees in one of its stores in San Francisco. Global annual investment in robotics is predicted to reach $135 billion by 2019 (Business Insider).
  • FACT 4: With RFID tags, retailers can achieve 99% inventory accuracy and increase in sales up to 7% (Forbes and Oracle).

Information Technology

Many of the top IT companies have already started investing heavily in IoT. These companies are building the infrastructure and developing systems that will allow them to support IoT expansion to better serve their customers.

  • FACT 5: Over the next 4 years, IBM plans to invest over $3 billion in its IoT business unit (Information Week).
  • FACT 6: Cisco is spending $1.4 billion on Jasper Technologies, a software development company that allows businesses to manage connected devices ranging from cars, vending machines, beer kegs, security systems, etc. (CNBC).

Industrial

Large enterprises are incorporating IoT into their operational and supply chain processes to help manage quality assurance, inventory, increase efficiency and reduce costs.

  • FACT 7: Farmers can save up to 90% on water bills with a smart sprinkler because it analyzes the weather and soil to determine the right amount of water needed (Forbes and Oracle).
  • FACT 8: An international truck manufacturer placed sensors on 100,000 trucks to help with predictive maintenance so it can automatically schedule repairs. The company receives over 1 million daily readings (SAS and Blue Hill Research).

Energy

For many years, energy consumption and reducing our carbon footprint has been an area of concern. We (individuals, businesses, cities, etc.) take it for granted and often times don't realized when energy is wasted. IoT can help us take advantage of developing technologies to provide details on how much energy we are consuming and find ways to save it.

  • FACT 9: Cities can reduce energy costs up to 80% by equipping street lights with sensors, only bringing to full capacity (otherwise dimming) when motion is detected (Iron Paper and Cisco).
  • FACT 10: In the U.S. approximately 30% of the energy used in an average commercial building is wasted (Intel).

Safety Security

As for the future of safety security, IoT is playing a significant role. It is helping law enforcement and officials better protect, watch and remain informed. It also helps homeowners watch their home by monitoring and sending alerts. On the other hand, as more and more devices become connected to the Internet, there becomes a crucial need for cloud-based security services to protect our personal information as we become more digitalized.

  • FACT 11: The law enforcement industry is utilizing IoT for body cameras and smart guns. Use of body cameras can lead to nearly a 90% decrease in complaints and a 60% decrease in officer forcefulness based on one city's study. The chip in smart guns allows officers to access real-time data (The Guardian).
  • FACT 12: In 2016, IoT security spending is predicted to reach $348 million (ZDNet and Gartner).

Healthcare

Both doctors and patients can experience the benefits of the IoT. Connected products, mobile apps, wearable devices and more, allowing patients and doctors to measure, monitor and track health conditions in real-time. This also can save a significant amount of time and money because now health can be monitored in the convenience of one's own home and moves to a more proactive instead of reactive model.

  • FACT 13: 4 million global patients will remotely monitor their health conditions by 2020 (IBM and Mobi Health News).
  • FACT 14: It costs an average of $1,700 per day for every patient that is kept in a hospital. IoT can help reduce this cost with remote monitoring products, so patients can be sent home and still be monitored (CIO and Kaiser Family Foundation).

Commercial

Soon consumers will start to see every type of business incorporate the IoT. Everything will be digital and customer journeys and experiences will be significantly improved. On the back end, businesses will utilize the IoT to help cut costs, increase efficiency and monitor operational processes.

  • FACT 15: By 2020, the connected kitchen will help the food and beverage industry save at least 15% (Information Age and Gartner).
  • FACT 16: Only 9% of K-12 higher education IT managers have implemented parts of a Smart School plan, but 46% believe the IoT will have a major impact within the next two years (EdTech).

Transportation

Cars, trucks busses, etc. will all be connected in the near future and some have already started. Next, these methods of transportation may even become "driverless." IoT in the transportation industry will help reduce the number of car accidents and help save energy. In addition, it can help businesses better and more efficiently track and manage their drivers, as well as maintenance and repairs.

  • FACT 17: In 2012, 10% of cars were connected to the Internet; by 2020, it is estimated 90% of cars will be connected (Link-Labs).
  • FACT 18: Over 32,000 people in the U.S. died in a car accident in 2013. The New Jersey Turnpike Authority (NJTA) took action by installing over 3,000 sensors along roads to improve emergency services and reduce driver delays (CIO and U.S. Department of Transportation).

Conclusion

It's a no-brainer: with 20.8 billion connected devices by 2020 and 5.5 million new things being connected each day, it is time for service providers to get ahead of the curve ( Gartner). With so many industries expanding the impact IoT devices have and leveraging them to enhance their businesses it's clear that IoT isn't going away and will be a large part of the future. Partnering with a proven IoT expert and capitalizing on analytics will help communications providers take advantage of developing technologies to improve their bottom line and compete for a piece of the IoT pie. A proactive approach to preparing the infrastructure for the future technologies of IoT will ensure readiness to take advantage of this huge new market.

For more information on how to overcome the challenges of IoT and experience its benefits, please email us at marketing@excelacom.com.

 
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James-Comfort

James
Comfort

James Comfort is the Manager of Service Delivery at Excelacom. James has 7 years of experience in the IT Consulting and Telecommunications industries and is PMP certified. James has held various roles during his tenure at Excelacom, including project management, deployment, and strategic planning of delivery systems.

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Innovation meets performance.