Understanding the Internet of Things - a market opportunity…
- 03 December, 2015 04:03
The Internet of Things (IoT) is one of the hottest technology topics in 2015 and will continue to be the subject of hype and conjecture for the next five years.
Almost every IT and telecoms vendor has an IoT strategy, backed up with an impressive set of slides.
Unfortunately, many also lack credible experience, demonstrate a lack of understanding of what constitutes IoT, will misrepresent the IoT stack (usually to give more credibility to their own product portfolios), and treat IoT as a homogenous technology that is equally applicable to different industries.
“IoT is already a significant market, and is set to grow significantly over the coming years,” says Stuart Ravens, Research Analyst, Ovum.
The market will be driven by industries where IoT is already a reality, such as manufacturing and utilities. In these industries IoT will drive two different, but adjacent, outcomes.”
On one hand, Ravens believes IoT will drive small improvements to existing processes: the bulk of IoT deployments will be about marginal efficiency gains.
On the other hand, IoT will significantly disrupt the business models for these industries, as it promises to overhaul decades-old business processes, and introduces significant automation and new ways to interact with customers.
“IoT will be equally useful in other industries, such as oil and gas, but will have a much lower impact on business models,” Ravens adds.
“At the other end of the scale, IoT is less certain to take off, but if it does it could completely change the face of some industries.”
For Ravens, IoT also threatens to turn the insurance sector on its head, particularly in auto insurance, as the use of sensing can help insurers more accurately profile drivers and calculate risk premiums.
“IoT is not suited to all industries; education is one of these,” he adds. “With no assets to monitor, track, or automate, the number of use cases is severely restricted.”
In looking ahead to 2016, Ravens believes IoT continues to be “poorly understood and misrepresented”, with significant barriers to deployment continuing to persist.