February 12, 2018
By Tim Sherwoo
The Internet of Things (IoT) has long been billed as the next big thing—and for good reason. We’re in an era of always-on connectivity, where traditional barriers to communication are crumbling by the day. With fewer boundaries and more freedom comes the space to innovate and connect.
We often think of consumer devices such as smart TVs, wearables and connected home appliances, but where the IoT has already flourished is in the industrial sector through applications such as predictive maintenance and smart energy distribution.
According to a plant maintenance study from 2016, 51% of manufacturing plants now use a computerized maintenance management system, and data from a range of sources suggests that businesses can save 10 to 20% using predictive maintenance.
It is expected that globally there will be over 20 billion connected devices in use by 2020. For enterprises, this presents a huge opportunity. Harnessing the insights gained from IoT means businesses can make their operations more efficient as well as develop new revenue streams.
Despite the potential benefits, the adoption of enterprise IoT has been steady, even underwhelming given its massive potential. It is estimated that through 2018, nearly three in four IoT projects will take up to twice as long as planned.
What’s holding enterprises back?
The answer is simple. Game-changing innovation is often followed by a fragmented marketplace, as pioneers develop new applications and follow their own rules.
In the early days of the World Wide Web, competition for dominance of programs such as browsers, music sharing and messenger services was frenetic. Eventually, the players with the most scalable business models and agile innovation cultures prevail as the giants of the new world. The phenomenon of IoT is unlikely to be any different.
Right now, though, enterprises are confronted by a bewildering array of service providers, technologies and platforms. There are no standard best practices for connecting multiple end-points—whether that’s devices or people. And the movement to cloud-based, mobile-first strategies that optimize connectivity with customers, employees and assets worldwide has added layers of complexity.
Each technology comes with different standards and can be applied to different applications, creating technical and application silos. It adds up to a landscape that’s both difficult and time-consuming to navigate. Indeed, Forrester indicates that design teams can search through more than 19 new wireless connectivity choices and protocols to support a company’s IoT projects.
The fragmentation of standards and protocols combined with the overwhelming number of products and partners to choose from decelerates adoption. An Economist Intelligence Unit study found that over 50% of senior business leaders said progress with the IoT had not been as fast as they had expected.
Too many apps, not enough communication
So what are the implications of this fragmentation for the end user? Let’s take an example. You’re getting ready to attend a scheduled meeting and you’re planning to drive there using your phone’s GPS for navigation. You’re also going to use an app to find the nearest parking space. Currently Google Maps tells you the expected journey time, but not where the nearby parking spaces are. Your parking app can tell you where to park, but not how long the journey will take you.
In other words, you need multiple apps to get the information you need. Even then, it’s incomplete: you’re going to have to work out yourself how much time you’ll need to park the car and get to your meeting on time.
For enterprises to truly embrace IoT, platforms and technologies need to converge and become more coherent. And that’s precisely what’s starting to happen.
A new paradigm spells new opportunity
We’re seeing this as the advent of the age where devices are “born connected.” With greater cooperation amongst different ecosystem players (equipment and device manufacturers, connectivity providers, platform and software solution providers), an IoT device can more quickly start collecting and transporting data.
Even more so, as devices communicate beyond their initial enterprise closed-loop system, the exponential value of IoT will be unleashed. Remember that meeting you wanted to get to on time? Imagine having an app that could tell you what you really need to know—which is that it’s going to take 20 minutes to drive there, but since the parking space is another 10 minutes away and you will take 10 more minutes to reach the meeting room, you’d better leave now.
The industry is already beginning to reshape itself to make this happen. Mobile network operators are now willing to forgo being the main service contractor and provider.
Instead, they’re choosing to partner with IoT platform providers and third-party system integrators to realize their own IoT strategies. The result is the emergence of more connected networks delivering more satisfying results.
If you’re in the automotive industry, you’ll be able to deliver a borderless, unrestricted and connected car experience, anywhere across the globe. Transport and logistics companies can realize new cost efficiencies. Drivers will be able to stay connected to their company network, wherever they are—and the same goes for airline crews.
Building connectivity into aircraft will enable diagnostics and servicing, and even go as far as identifying potential problems with an aircraft before it creates operational issues.
Thanks to a growing convergence of digital technology platforms and capabilities, we’re moving towards a “one-stop shop” for the IoT needs of enterprises—one that’s accessible in both developed and developing markets.
Enterprises, take note: The Internet of Things is finally coming of age.
Copyright 2018 EJ Insight of Hong Kong Economic Journal Co., Ltd. All Rights Reserved.
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