What is the Internet of Things (IoT)?

There are many advantages to the widespread use of the Internet of Things in our daily lives.

The range of benefits includes:  

1. Making life easier for consumers. The clearest benefit of the IoT is the automation of daily routines for consumers. They only need a smartphone connected to the internet to solve everyday problems. For example, smart ovens can be controlled via an app, allowing a person to preheat the oven on the way home from work. 

2. Saving businesses time and money. Internet of Things automation boosts efficiency and productivity. By relying on IoT devices and processes, businesses don’t need to wait for human effort. Data is automatically available, saving companies time and money. 

3. Offering a better understanding of the world. IoT devices provide an opportunity to gather information that otherwise would have been hard to get. For example, smart home systems make monthly energy usage easier to track and understand. The reports can even be broken down per device so that consumers can understand exactly where their energy usage comes from, allowing them to alter their habits and reduce energy consumption and waste.

4. New business opportunities. There is a vast amount of data collected from consumers, giving manufacturers an opportunity to understand and anticipate their customers’ needs. This means that businesses can make predictions and develop solutions — potentially before they arise. For example, wearable healthtech (such as fitness watches) collects data on sleep patterns and exercise habits. Doctors can use this information to better understand their patients and accurately diagnose their problems. On a larger scale, the aggregation of this data can lead to a better understanding of a population’s health concerns. The application possibilities of the information are endless. 

Though the Internet of Things (IoT) is intended to make life easier, there are downsides too: 

1. Privacy and security concerns. Thieves can target the personal data gathered from IoT devices for theft and misuse. 

2. Incompatibility. IoT devices are manufactured around the world without standardisation. It can be hard for devices from different manufacturers to interact and communicate with each other. 

3. Overdependence on technology. If every process is automated, a single bug could crash the entire system. In addition, connecting too many devices to the internet slows down the speed. 

4. Increased monitoring time. Large corporations may find that tracking and monitoring a large volume of IoT devices can overwhelm IT operations. 

Internet of Things (IoT) devices fall into two categories, depending on their usage. The first category is consumer IoT products:

• Smart cars: from automatic maintenance reminders to parking availability features, cars are becoming increasingly connected to the internet and the cloud.

• Smart cities: more cities are turning to IoT devices to manage their water, connect public transportation, and monitor and manage traffic. Smart traffic lights can adjust to traffic patterns, reducing wait times and vehicle emissions. 

• Smart devices: Smartwatches are everywhere these days, as are smart home security systems. Smart fridge freezers, door locks, and bicycles are rising in popularity too. 

• Healthcare: Wearable IoT devices can sense and track glucose levels or heart rates. The data gathered from these can lead to better patient outcomes. 

The second category of IoT devices is enterprise. The ability of IoT devices to reduce operational costs and improve efficiency are two significant motivators for IoT adoption. Now, businesses use IoT for a variety of functions:

• Manufacturing: facility managers can monitor and manage machines remotely with IoT devices. The information from these connected devices also allows for waste reduction and energy conservation, giving managers better insight into operations to make informed decisions.

• Retail: merchandise fitted with radio-frequency identification (RFID) tags can provide more accurate stock information. This is particularly useful as more customers shop online. 

• Supply chain management: Global positioning systems (GPS), sensors, and tracking technology have increased the visibility of assets as they move. IoT technology also offers quality and safety controls. For example, maintaining a set temperature during transport or managing delivery requirements. The data gathered from IoT devices also provides analytics to improve shipping times or create more efficient routes. 

Like anything connected to the internet, IoT devices are susceptible to digital attacks. There were over 10.8 million cyber attacks on IoT devices in October 2020 alone. However, the risks can be minimised through better security protocols, like secure user authentication and data encryption. 

Consumers are concerned about the privacy of their personal information too. The sheer amount of data generated by IoT devices creates opportunities for hackers to access sensitive information. Virtual invasions of individuals’ homes are also possible, with hackers listening to private conversations. Additionally, there are growing concerns about how companies use the data willingly gathered from consumers for other purposes. For example, could a life insurance company use data from a fitness tracker when estimating an insurance premium?

The worldwide market worth of the Internet of Things was estimated to be around $389 billion USD in 2020. That revenue is forecasted to more than double by 2030, coming in at an estimated $1 trillion USD. The number of IoT-connected devices is also expected to triple in this time. 

Technology advancements have made the widespread adoption of IoT devices more accessible than ever. Large enterprises have consistently invested in IoT technologies for years, and now small and medium-sized companies have begun to use them too. 

The result of this growth is the opportunity for new revenue streams, increased business efficiencies, new business models, and improvements to existing models across various sectors.

One of the biggest challenges for Internet of Things implementation is the lack of standards. Businesses can only achieve the benefits of IoT through seamless integration and interoperability. If enterprises rely on data sharing between devices and systems from different vendors that can’t communicate, then the advantages of IoT are lost. 

Universal standards would guarantee what an IoT device can do and its quality. This would eliminate inefficiencies in the marketplace and fuel global adoption. Additionally, flexible interoperability would help users avoid the commercial risks of single-vendor lock-in. 

The IoT framework is the technology that allows IoT-connected devices to communicate over the internet. Multiple connected devices create an environment that senses and exchanges data over the internet without human interaction. The main components of the IoT framework are:

• Device hardware

• Device software

• Communication and cloud platform

• Cloud application

The terms ‘IoT devices’ and ‘edge devices’ are sometimes used interchangeably, but there are differences between the two. In simple terms, an IoT device is a physical object connected to the internet and is a data source. An edge device is where the data from an IoT device is gathered and processed. It is a physical piece of hardware in a remote location at the edge of a network. An edge device contains the right amount of memory, computing resources and processing power to collect data, process it, and then act upon it without help from the larger network. 

Using edge computing and IoT together allows for faster response times, operational efficiency, improved network bandwidth, and other benefits.

Okay, that was a lot of info!

Here’s what you should take away from this article:

• What is the Internet of Things? The Internet of Things (IoT) describes physical objects that have an internet connection and transmit data online.

• What are some Internet of Things examples? Examples of IoT use include home-monitoring systems, smart cars, health and fitness apps, remote energy control, and machinery fault diagnostics.

• How does the IoT work? The IoT uses embedded sensors and computer chips in everyday objects that transmit and receive data via the Internet.

• How can businesses benefit? Businesses can benefit from big data to increase productivity, reduce energy consumption, and improve customer service.

• What industries can use IoT? Many industries have benefitted from implementing IoT systems. Healthcare, manufacturing, transport and logistics, retail, agriculture, and finance have all boosted efficiency thanks to IoT adoption.

• What does the future of IoT look like with new technologies (edge computing, AI, 5G)? The IoT will only continue to grow with the help of innovations. It will become smarter, faster, and more reliable.

• How will the IoT affect customer relationships and CRM? The IoT will improve customer relationships by automatically providing personalised responses and instantly sending customer information to CRM platforms.