2014 is set to be the year when the focus of both IT buyers and IT sellers, shifts to the Internet of Things (IoT). In 2014, more data will be generated by machines (‘things’) than by human beings. This creates enormous opportunities:

  • 1. To analyze and use vast amounts of data.
  • 2.   To store data and source application functionality in/from the cloud.
  • 3.    To create, manage and support apps that enable the operation and management of IoT implementations.
  • 4.  To provide high speed connectivity between objects and the people, who work with them and use them.

Indeed, the explosion of IoT activity over the next few years will be driven by the nexus of low cost sensors, cloud computing, advanced data analytics and mobility.

Big Data

Using powerful analytics tools to take full advantage of the huge amount of data available is becoming common. Big data projects are increasingly being viewed as priorities. As individuals, we see the results of such projects all the time. For example, have you noticed how the ads that are served to you in your Facebook news feed, are increasingly well targeted?

The IoT is set to create much more data than is created by human beings. This data will be used to enable organizations to increase efficiency and effectiveness, grow revenues, innovate, and transform the way they do business. Demand for tools that can visualize this data will increase as organizations seek to improve evidence based decision making.

Cloud Computing

In mature economies, cloud computing has become mainstream. Organizations in most mature economies, as we predicted, now need to find a justification for not using cloud computing as opposed to on premise alternatives, rather than the converse.

The new cloud opportunities will be driven by the IoT. Data generated by low cost sensors will be stored and analyzed in the cloud. Applications which drive the functionality of sensors and other mobile devices will also be hosted and developed in the cloud. These cloud computing opportunities will multiply as the IoT becomes more widespread.


The app explosion will be further accelerated by the IoT. These apps will be developed in the cloud for deployment on any device or sensor. Platforms that allow this app development will become more widely used. Leading technology vendors, such as Salesforce.com, Microsoft, VMWare, Amazon and Google, will battle for dominance, as the provider of the cloud platform on which apps are developed. A professional services market centered around the development and management of apps will become increasingly significant in 2014.

Mobility and High Speed Networks

The penetration of smartphones has surpassed 50% in many economies. This is driving businesses to find ways of engaging their customers directly on their smartphones. Expect to see apps become the primary form of engagement with organizations. In other words, the first thing that people will do when they want to interact with their bank, airline, favorite retailer or restaurant , is find an app that enables and enhances that interaction. High speed networks will need to be deployed to enable this heavy use of increasingly sophisticated apps. From and IoT perspective, these networks will be necessary to rapidly and reliably transmit growing volumes of data between sensors  and devices.

Some Specific IoT Opportunities

The biggest revenue opportunity today for an IoT ecosystem is transportation and logistics. The deployment of low cost IP enabled sensors within ‘things’ that move products around as well as within products themselves, opens huge opportunities beyond supply chain optimization.

Airbus is an excellent example of the use of sensors to drive performance in the transportation sector. The components that make up an A380 are fitted with sensors that can monitor ‘wear and tear’ in real time. This allows Airbus to create a dynamic maintenance process optimized by data continually being generated from components that are being used. From a technology perspective this requires a huge amount of storage and application functionality, as well as data analysis. Cloud computing, big data technologies and lower cost sensors will enable aircraft manufacturers and airlines to transform and optimize their maintenance processes.

Other industries are opening up to the opportunities created by the IoT. Smart cities, connected cars, and connected health are examples of transformations that are being driven by IoT.  There is also a lot of interest in how the IoT will impact manufacturing. Soon, managers in the manufacturing sector will monitor and manage machinery from their mobile devices. The activity of specialized machinery such as drills will be monitored using myriad of sensors. This will enable manufacturers to replace expensive machinery based on usage rather than based on the amount of time the machine has been installed. These developments and others have huge implications on the way manufacturing plants are designed, operated and maintained.

Key IoT Challenges

The IoT is dependent on cloud computing, high speed connectivity and powerful data analysis tools. Issues around reliable connectivity and enterprise grade cloud computing services still exist. Reliability and performance issues will need to be addressed to allow the potential of IoT to be realized.

As more machines operate independently of human beings, the potential risks associated with security breaches multiply. Hacking a self driving car or an aircraft navigation system could have devastating consequences. Technology vendors must continually ensure that IoT technology is secure and that there are processes to address security breaches.

Although the ever increasing number of ‘things’ is expected to be IP enabled, it remains important that standards emerge, as ‘things’ may not be able to communicate with each other and the people that engage with them. There remains a risk that we create an ‘Internet of Silos’.

In summary, as cloud, data analytics, mobility and connectivity technologies mature, the IoT will open up enormous new opportunities across industries. Activities that were once the domain of specialized industry vendors will become open to the world’s leading technology firms. Technology vendors will place much greater focus on industry specific activities as they seek to fully benefit from the IoT and connected industries.