Businesses of all sizes and sectors are looking at the Internet of Things in a bid to be more efficient, productive and profitable. But there are as many challenges as opportunities.
There has been plenty of hype surrounding the Internet of Things (IoT) and the reason for this is that it doesn’t simply promise to improve the lives of consumers, but also represents a huge business opportunity.
For those unaware, the Internet of Things refers to a network of physical devices or things that can connect to the Internet, changing the way that we interact with them. While we already experience far more connectivity than ever before, largely due to the development of smartphone technology, the Internet of Things places no limits on what can constitute a connected device.
Because IoT could impact upon businesses ranging from automotive giants to independent retailers, the opportunities are similarly open-ended. In its report, the Future of the Internet of Things, PricewaterhouseCoopers indicated the scale of change on the way:
“IoT is transforming the everyday physical objects that surround us into an ecosystem of information that will enrich our lives. From refrigerators to parking spaces to houses, the IoT is bringing more and more things into the digital fold every day, which will likely make the IoT a multi-trillion dollar industry in the near future.”
There are already a number of examples of businesses harnessing these IoT opportunities. Wearables – including smart watches, fitness trackers, connected jewellery and even smart fashion- are some of the most common IoT devices, but there are many other implementations being tested.
The home, for example, is seen as a key battleground for businesses looking to dominate and monetise from the fledgling IoT market. Google is transforming its learning thermostat device, Nest, into a more general hub, while Apple has launched HomeKit to enable individuals to control their entire home from their iPhone. These companies realise that if they can deliver a centralised home hub, they can dominate and shape the future IoT ecosystem – in much the same way that Android and iOS have a duopoly in the mobile development landscape.
Outside of the home, the Internet of Things is proving an equally attractive business proposition. In the manufacturing industry, factories are now employing a wide range of sensors, PLCs, robots, manufacturing execution systems (MES) and bar codes, to collect data on their business processes. This can then be analysed to deliver new efficiencies, by giving organisation end-to-end visibility of the entire manufacturing process. By accessing more data, businesses can easily identify processes that are particularly cost effective (or not) and possible faults in real-time. Ultimately, the Internet of Things is giving factory managers greater visibility than ever before.
The Internet of Things is also revolutionising the retail industry. Toshiba’s real-time digital merchandising platform monitors item sell-through rates to inform stores of how much stock is required each day, reducing wastage and boosting profits. Stores can also dynamically adjust prices using digital signage in order to promote particular items. Considering the flexibility that IoT devices can bring to retailers, it is hardly surprising that 96 percent have said that they are willing to make the changes required to adopt the Internet of Things.
Although IoT represents a significant business opportunity in the present, even more innovative applications for the technology are expected in years to come. It is predicted that connected cars will eventually take over our motorways, with Tesla, Google and many others developing their own models. Smart devices are expected to become the norm in homes and offices and businesses will use the data collected from these devices to deliver new and improved services.
However, the future of IoT is unlikely to be without its difficulties. The masses of data set to be collected will understandably increase privacy concerns, placing greater onus on transparency. It will also challenge the existing network infrastructure as the number of access points multiplies rapidly. Perhaps most concerning of all, are the added security hurdles that must be overcome. Cyber-attacks can already have huge consequences, but if hackers were to infiltrate IoT healthcare devices or connected cars, for example, the outcome could be even worse. For businesses looking to move into the Internet of Things, security and privacy must always be key considerations.
The Internet of Things is predicted to have a profound impact on the way that we live our lives and many businesses are already putting this change into action. Across healthcare, insurance, manufacturing, retail and many other industries, connected devices are providing numerous insights. The future holds even greater potential for businesses, not only regarding financial opportunities, but in terms of fundamentally changing the way in which we interact with the world around us.