The concept of an Internet of Things has been around for some years. Today, it refers to an internet connected network of physical devices of all types equipped with embedded sensors and capable of transmitting the sensed information wirelessly to the internet and from there to a variety of computers, smartphones and the like to be stored, analyzed and used to control the physical devices remotely.
Broadband Internet is become more widely available, the cost of connecting is decreasing, more devices are being created with Wi-Fi capabilities and sensors built into them, technology costs are going down, and smartphone penetration is sky-rocketing. All of these things are creating a “perfect storm” for the IoT.
Simply put, IoT is the concept of basically connecting any device with an on and off switch to the Internet (and/or to each other). This includes everything from cellphones, coffee makers, washing machines, headphones, lamps, wearable devices and almost anything else you can think of. This also applies to components of machines, for example a jet engine of an airplane or the drill of an oil rig. As I mentioned, if it has an on and off switch then chances are it can be a part of the IoT.
In 2015, there were over 3.8 billion internet connected things, and Cisco Chairman John Chambers was forecasting that within 5 years there would be 50 billion connected things in a market worth U.S.$19 trillion.
In 2020 the hype has toned down somewhat. IDC reports show IoT spending impacted by the COVID-19 pandemic growing at 8.2% per year to $742 billion in 2020. It expects the growth rate to rise again to a compound rate of 11.3% from 2020 through 2024.
IDC estimates that IoT spending in 2020 will be divided among: sensors (28.6%), service (21.3%), IT and installation services (14.2%), application software (11.7%) and other (24.2%). Applications in healthcare, insurance, and education are growing the fastest in 2020. Other growing application areas include air traffic control, oil field exploration, manufacturing operations, production automation, freight monitoring, electric vehicle charging, bedside telemetry, and remote health monitoring and smart home spending.
Now here is a surprising fact. In 2017, IBM was a major player in the IoT. It announced a $3 billion R&D program focussed on the Internet of Things and was partnering with many enterprises targeting specific areas of the IoT landscape. IBM was also working with AT&T, Cisco, GE, and Intel to improve the integration of the Physical and Digital worlds by establishing operating standards. But in the IBM 2019 annual report, there is not one word about the IoT; and it is hard to determine where it would fit in the IBM reporting structure.
Security is a big issue for the Internet of Things. With billions of devices being connected together, what can people do to make sure that their information stays secure? Will someone be able to hack into your toaster and thereby get access to your entire network? The IoT also opens up companies all over the world to more security threats.
Then we have the issue of privacy and data sharing. This is a hot-button topic even today, so one can only imagine how the conversation and concerns will escalate when we are talking about many billions of devices being connected. Another issue that many companies specifically are going to be faced with is around the massive amounts of data that all of these devices are going to produce. Companies need to figure out a way to store, track, analyze and make sense of the vast amounts of data that will be generated.