IoT 101: What is the Internet of Things?

The ideas of a ‘Thing’ or the ‘Internet’ are not new concepts. These concepts have existed for a long time, with companies creating methods in order to improve and innovate upon them. The Internet of Things, or the IoT, is the result of the rapid technological evolution of both these concepts, which have evolved with time along with the mechanism they use for connections. IoT specifies a number of services that were originally dispersed.  It is not just about connecting things anymore but is also about analyzing the data produced by these things. Data analysis leads to new insights and also helps in creating patterns, analyzing situations, giving solutions, and programming ordinary things to make decisions and optimize themselves.

IoT is the future of technology all around the world. Experts are suggesting that more than 80% of the money spent on IoT in 2020 will be for the application and use of B2B. Although IoT has become a key strategic conversation point across technology and business forums, the landscape around the Internet of Things and how it actually functions is still unpredictable. The number of connected things is expected to grow at an annual rate of 23.1% between 2014 to 2020, reaching 50.1 billion things in 2020. However, this complex web of varied parts can be classified even further.

What is the Internet of Things?

A complete IoT ecosystem consists of multiple different parts. These parts consist of things like embedded systems, sensing and acting capability, electronic circuitry, edge computing, network protocols, communication networks, cloud computing, big data management and analytics, business rules.

IoT devices are capable of sensing the environment and then responding to the input that they receive. These devices are composed of sensors and actuators that are connected to the machines and the electronic environment as well. The electronic environment of a device is capable of pre-processing the data received from the sensor and then sends it to the IoT platform. This electronic environment is also able to post-process the data or instruction gathered from the IoT platform before passing them to actuators for further action.

These devices connect to an IoT platform and send the data sensed by them. In turn, they receive instructions from the platform. The electronic environment has the capacity to connect over the internet directly or through the use of internet gateways. In order to connect to the internet directly, there are multiple wired and wireless communication protocols, some of which include the use of low powered communication networks. Then, devices which connect via gateways generally communicate over a short-range radio frequency or wired protocols. Because of this, the internet gateway is able to further communicate with the IoT platform over long-range radio frequency protocols.  

The IoT platform is the brain of an IoT system. It is responsible for efficiently receiving the data ingested from the devices, then analyzing that data in real-time and storing it for “history building” and for further processing in the future. It also gives and creates services to monitor, control and manage the devices remotely.  The Platform routes the data to other integrated enterprise systems based on the business rules available in the system and provides services to visualize the data on multiple connected tools such as web interfaces, mobiles, and wearables. Finally, it compiles the data in context for the users so that they get the right information at the right time.

The advent of IoT has the potential to redefine the business models that would open new opportunities for new sources of revenue, improved margins and higher customer satisfaction. There are broadly 5 trends in business model innovation: product and service bundling, assured performance, pay as you go, process optimization, predictive and prescriptive maintenance. A successful IoT deployment should be able to clearly identify the type of business service that will be delivered by the finished product. If you do this in the early stages of planning for the IoT, it increases the chances of creating a positive response from the consumers.

The complexity of the IoT system varies, depending on the type of technology being used, platforms, and business needs. This complexity will ultimately grow with the continued proliferation of more IoT platforms that seek to provide technology and business use case specific value propositions.

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