Emerging technologies such as Internet of Things (IoT) are shaping our lives and disrupting the traditional businesses at an unprecedented rate of change. Enabled by exponential increase in computing power and availability of large amount of data, machines are fast learning to replace humans in several areas. This “intelligence” is moving away from central server farms into devices and things that will soon become a part of our everyday lives. These devices will potentially negotiate their own way in our world via “smart contracts” and without any significant human intervention.
The IoT market is expected to grow steadily as billions of devices, services and systems become connected, mainly driven by increasingly ubiquitous and cheaper sensors that convert the physical data to digital content. The IoT use cases focused on delivering cost savings from fuel, energy and labour often have a significant financial impact and shorter payback time frames. In terms of the market size, IoT spending is expected to register 15.4% y-o-y growth to reach US$1.1 trillion by 2025.
As per a recent FICCI-EY report, ‘Future of IoT’, which outlines the future of IoT from business potential and technology point of view, global IoT connections are predicted to increase with 17% CAGR from 7 billion to about 25 billion from 2017 to 2025. The industries forecasted to spend the most on IoT solutions in 2019 are manufacturing ($197 billion), consumer IoT ($108 billion), transportation ($71 billion) and utilities ($61 billion). IoT spending among manufacturers will be largely focused on solutions that support manufacturing operations and production asset management. More than half of IoT spending in transportation may go toward freight monitoring, followed by fleet management. IoT spending in the utilities industry may be dominated by smart grids for electricity, gas and water. Asia-Pacific region is forecasted to become the largest global IoT region in terms of both connections and revenue by 2025.
India is fast leapfrogging the deployment of emerging technologies. India offers an opportunity to deploy these emerging technologies at a large scale to bring efficiencies and economies of scale. Newer opportunities and ecosystems are developing every day. The Government of India is taking several steps to push the adoption of emerging technologies with innovative initiatives such as Digital India, Make in India, Smart Cities, etc. As per NASSCOM report on IoT Landscape, India will be a front runner in IoT adoption in Asia Pacific (APAC). The IoT market size in India is expected to grow at rate of 62% CAGR and reach $9 billion by 2020.
It is predicted that IoT devices worldwide generate 90 zettabytes of data by 2025. This data is sent directly by sensors or via gateways to centralized platforms that aggregate, process, store, analyze and visualize this data to create insights and improve operational efficiencies of processes. The centralized architecture offers large scale computing and storage tasks to be done centrally so as to increase the operational efficiencies. However, centralized architectures increase latency of data exchanged, increase the time to act on actionable intelligence, are less resilient to environmental disasters, more prone to security hacks, are more expensive to scale (e.g., building a new data center in a new geography) and are designed using commodity hardware which may lack versatility of appliances dedicated for specific tasks. These shortcomings are leading to the evolution of computing platforms from centralized architecture to distributed or decentralized architecture with a focus on fog computing and AI capabilities closer to sources of data.
Kurzweil curve predicts an exponential increase in intelligence and expects the advanced computing platforms to equal the intelligence of a human brain by the end of the coming decade. This is primarily being driven by a combination of exponential increase in data being generated by IoT devices, multifold increase in computational power, advanced AI algorithms, compact form factors and low power requirements.
The key sectors for IoT are likely to be utilities (water and electricity), manufacturing, transport and logistics, automotive industries and healthcare, going forward. IoT devices and software are being deployed throughout a farm to monitor crop health, manage inventory and supply chain. IoT sensors have the ability to notify a farmer that an animal is sick, so that the said animal could be separated from the herd and measures could be adopted to prevent the spread of the illness. Connected cars can lead to reduction in maintenance cost by 10%-40% and drop in insurance premium cost by 25% following reduction in claims by GPS tracking of stolen cars.
The major enablers of IoT are drop in sensor and electronic cost, rise in computing power, on-demand cloud computing, fall in cost of connectivity, digital business models, evolving partnerships to leverage technical expertise, advancements in connectivity technologies and flagship government programs such as Smart Cities.
(The author is Chairman, FICCI Rajasthan Sub-committee on IT & ITeS, and Delivery Centre Head, Infosys Ltd, Jaipur)