The Enterprise impact of the “Internet of Things”

One of the currently hot technology topics is the “Internet of Things” (or IoT), a wide ranging field which can be as challenging to define as it is to understand its future impact. Gartner Group defines the Internet of Things as “the network of physical objects that contain embedded technology to communicate and interact with their internal states or the external environment”, which is about as succinct and inclusive as any other. In some ways, the term IoT is a misnomer, as many of the Things will not be connected to the Internet, but they will use internet technologies to communicate with other systems in a secure manner.

To discuss your own IoT strategy, go to our Data and Insights page and start a live chat with an advisor. Or for a little more detail on what IoT can encompass, see the blog post “What is this ‘Internet of Things’ thing, anyway?”

Industry analysts predict varying sizes of IoT, from the number of devices (from a few to many billions), the monetary size ($trillions) and the volumes of data (possibly in Zettabytes - a ZB is a billion Terabytes). Even if the exact numbers don’t always agree, they do concur on one thing – it’s going to be huge.

Ultimately, the reason for enterprises taking an interest in IoT is the data that it gives access to, and the ability to act based on analysis of it. This is where we will derive real value from IoT technologies, the architectural patterns of such systems and the processes and controls which go along with them.

Sometimes, other systems may already be measuring that data but not sharing it beyond their own boundaries, and in many cases it just won’t be collected at all – the continually falling marginal cost of data acquisition, storage and the computing power to analyse it, opens up new levels of insight and value that we’re only just beginning to understand.

There are many scenarios where we could see traditionally different vertical industries converging on sources of data collected with IoT technology, even if they use the same basic set of measurements in different ways. One such cross-industry example is the ‘Smart Building Management’ approach, as told in the 88 Acres story, resulting in significant energy cost savings, improved environmental sustainability credentials, improved employee experience and the capability for inanimate resources (such as fire extinguishers) to create their own work orders.

In the automotive industry, most car companies have some kind of “connected car” strategy, and many are showcasing their ideas as the industry changes around them. In a future where cars might drive themselves, the differentiator for the car manufacturer might be all about interior comfort and technology, rather than how well the car drives or how fast it goes.

Many cars these days already collect a lot of information about how they are performing – storing data within the car’s electronics systems and most likely being queried or interrogated if there’s a problem, or possibly when the car next has routine maintenance.

This data could be immensely useful to the manufacturer, but a different slice of the same information may be required by the driver’s insurance policy, as Usage-Based Insurance policies grow in popularity, particularly for traditionally high-risk drivers (the Aviva Drive app for Windows Phone is a great example). The same type of data could again be used to provide accurate road tolling (to price drivers off trunk roads at busy times, to even the flow of traffic more).

Data ownership is perhaps going to become one of the biggest non-technical challenges to successful Internet of Things adoption in cross-industry scenarios, but where an enterprise owns all the assets and the data they produce, and can justify investing time and money to better instrument those assets, there is a very clear RoI in pushing ahead.

The term “Internet of Things” will likely fade in the coming years, as the technology and the patterns of use just become part of the normal way of working, much as mobility has done in the last 5-10 years. The technology is developing apace, but a lot is already accessible and is being used by many organisations to optimise and improve their own operations and performance.

You can find out more about connected platforms on our Data and Insights page, or tweet us @MSFTBusinessUK to tell us your own IoT stories.