Not long ago, the concept of the Internet of Things (IoT) seemed like science fiction. But it’s clear today that consumers and enterprises alike have embraced IoT. Gartner recently reported that IoT is forecast to reach 26 billion installed units by 2020, up from 0.9 billion just five years ago and this growth is no surprise as IoT can provide consumers with many benefits. For example, think of the cost savings that can be achieved when you can control your environment with your smart phone—you’d never have to worry about leaving the lights on and you’d be able to program the heat to turn on during your commute home.
In the enterprise, IoT is driving more interconnectedness, generating more information and producing more insight than we could have even imagined just a few years ago. By achieving visibility into all of the connections between various inventory and assets, organizations can streamline processes and reduce costs.
The availability of this information also opens up new opportunities for creating customer value. For example, a water utility provider no longer needs to focus on only the low-margin business of providing water to the home. By adding a sensor that listens to the flow of water in the pipes and identifies usage patterns, the utility provider is able to sell an information-based service to customers on how to optimize their use of the utility. Auto manufacturers can similarly pass benefits along to consumers by providing on-board connectivity.
Organizations would be wise to offer the conveniences IoT provides in an effort to differentiate themselves from the competition. But, the level of connectivity needed to take advantage of IoT can be expensive.
I recently wrote a blog post in WIRED about how organizations are managing IoT and where the cost burden for its conveniences will fall. I predicted that the cost of IoT will be taken on just like any other business expense and will be weighed against its return on investment. By investing in IoT now, enterprises can create solutions that consumers will want to buy and increase their bottom lines in the long run. They’ll also be able to attribute valuable insights into their internal assets, gaining a competitive edge in what is sure to be a hot market in the years to come.