The next transformation that will radically change our world is already here. One of the biggest opportunities today is the Internet of Things (IoT). Everything we can think of around us, at home, work, factories, laboratories, hospitals, on the street, in the car, on planes, ships and so on is interconnected and continuously communicating, exchanging data and information. The number of connected devices globally is pegged to grow from 12.5 billion in 2013 to 212 billion in 2020, according to IDC. This means there will be approximately 27 connected devices for every human being in the world by 2020.
The nature of these connected devices is also going to change. Today, a large part of the connected devices consists of things like mobile phones, tablets and laptops that we use to connect to the internet.
While this is only going to grow, a rather steeper growth will come from devices that will either be connected to the internet autonomously (which means they’ll connect on their own and will not have human beings operating them) or they’ll simply be connected to each other (machine-to-machine connections or M2M).
These devices will essentially add a certain amount of ‘smartness’ to all our commonplace industrial or consumer devices, enabled by tiny sensors and with processing power attached, making them aware of the context they are used in and getting them to act accordingly.
Industrial efficiency IoT in an industrial context enables connectivity of intelligent devices to drive higher efficiency through better visibility, collaboration, automation, and optimisation. According to GE, 46 per cent of the global economy will benefit from the industrial internet. Manufacturing only contributes to around 16 per cent of the current global GDP, and clearly the impact of the industrial Internet will reach far beyond manufacturing, into services sectors.
Savings in industrial efficiency could be in the range of $320-640 billion per annum. And while these numbers appear huge, they are not out of context. Every day, there is an incredible amount of wastage in current systems due to sub-optimal inventory planning, production, supply-chain, ordering systems, etc. These could be eliminated if intelligent devices and machines were to communicate with one another in a secure, real-time manner and make decisions driven by analytics.
Several industries are already taking advantage of IoT.
Sensors are being integrated into major automobile and aircraft subcomponents to monitor their condition in real time and address any issues proactively. Cities are installing smart sensors on street-lights to reduce power consumption when there is no traffic; garbage containers are enabled with sensors to indicate whether they are full and need to be emptied. The efficiency savings thus generated are also helpful in creating new opportunities andemployment.
Consumer context
IoT in a consumer context is even more fascinating. Some amazing products have already been announced and many more will launch soon. Earlier this month, several companies announced and displayed products leveraging IoT technologies.
Consumer-oriented IoT products such as smart watches, smart thermostats, smart home security systems, smart white goods, smart TVs and entertainment platforms are expected to have a faster adoption rate as people embrace connected devices and enriched user experiences that address real-world, day-to-day situations. The low unit price point of many of these products is also a critical element for consumers to buy and use them daily.
The more they are used, the more the feedback mechanism will improve subsequent generations of these products, platforms and technologies. A Business Insider report puts this $2.5 trillion opportunity (by 2020) as “connected life market revenue”.
Over time, these IoT-oriented products will become an integral part of our lives and, much like smartphones today, will become inseparable.
This will be a key year for IoT as we are at the cusp of this huge opportunity driven by it. Mainstream adoption of several industrial and consumer IoT products and technologies will drive increased connectivity, richer user experience, improved efficiencies and higher collaboration across the ecosystem.Continuous advances in technology for sensors, smart devices, analytics, cloud, security, mobility, and so on must be leveraged, and an industry standard ecosystem platform to unify multiple smart systems and subsystems within and outside the industrial environment is needed to drive efficiencies and results. Let’s embrace the transformation that the Internet of Things will drive.
(The writer is Corporate VP & Global Head, Sales & Practice, Engineering and R&D Services, HCL Technologies)