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Why Is The Internet Of Things Most Active And Successful

The Internet of Things (IoT) is most actively and successfully used in transport, the oil and gas and banking sectors, and telecoms. The innovators include the mining and metallurgical sectors, retail, and electricity. The use of IoT in mechanical engineering and petrochemicals needs to catch up, and the debutant sectors that are just beginning to embrace IoT are healthcare, agriculture, housing, and communal services.

The IOT

This is stated in the study by the Center for Social Design “Platform” and the Schneider Electric company “Internet of things market.” Experts surveyed three target groups – consumers, manufacturers, and IoT analysts- after which they compiled a “digitalization funnel,” indicating which sectors have already been drawn into the digitization process and which so far remain only in the outer circle.

Among the leaders of digitalization, as it turns out, sectors of the resource economy predominate. On the contrary, the low level of digitalization is in the energy-intensive, age-sensitive housing and communal services, agriculture, and healthcare. One of the reasons for the lag of these sectors is the poor coverage of communication networks that provide data transfer from IoT devices.

Abroad, as a rule, the private sector drives digitalization. In contrast, private owners, on the contrary, are led by the government, notes Hans Timmer, chief economist of the World Bank’s regional department for Europe and Central Asia. The high share of the public sector in the economy makes it possible to rapidly develop service IT technologies for the population (for example, government services that can be received in electronic format). At the same time, paradoxically, it lags in the most in-demand parameters worldwide: IoT, robotics, and artificial intelligence.

Also Read: Five Dangers Of AI Development For The Future

Expert estimates about the growth of the IoT market vary. On average, we are talking about growth over the next two years at about seven percent; the most favorable estimates are 22 percent over two to three years. Respondents to the study by TsSP Platforma and Schneider Electric cite Western sanctions, which limit the transfer of technologies and ready-made solutions to the country. There needs to be more investment and general financial and economic instability among the growth constraints. In addition, if the retail and transport sectors were lucky in developing the IoT regulatory framework (the introduction of product labeling, RFID tags, etc.), then in the industrial sector, the capabilities of remote monitoring systems still need to be considered. Many GOSTs on the procedure for performing production processes need to be updated and hinder the implementation of remote control. This, in particular, was noted by iKS-Consulting experts in the study “Market of Internet of Things Technologies” in 2017.

However, sanctions, for example, also have a pleasant downside: the lack of access to ready-made solutions forces businesses to engage in their developments, and introducing new equipment can dramatically optimize business processes against the backdrop of a low base effect, according to survey respondents.

Thus, developers and manufacturers have a good chance of occupying the niche of IoT solutions (the market for the industrial Internet of things) for raw materials and processing enterprises with prospects for entering local export markets. As for consumer-oriented IoT, its prospects look more cloudy.

What will it take to leap?

From the state – improving legislation (revising the regulatory framework, creating incentives for using IoT solutions by the private sector, increasing budget funding for scientific and engineering schools). Businesses are required to expand the production of IoT hardware, including the localization of production and the production of their products, and to develop new communication protocols. Consumer companies are required to improve the skills of their personnel.

By 2025, the global Internet of Things market could be between $4 trillion and $11 trillion (conservative and optimistic forecasts, respectively, compiled by McKinsey in 2017). The volume of the IoT market by 2020 may reach 80 billion rubles. “Despite its rather modest starting positions, the IoT market already looks like one of the most promising areas for developing the digital economy,” the authors concluded.

Also Read: Discover 4 Most Exciting Applications Of The Internet Of Things

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