“The pace of change has exceeded the rate of human capability to absorb — the cup is already full. In 2018, the real issue is how to increase the ability for people to understand the changes and their implications more clearly, and to take concrete actions to take advantage of the potential upside,” says Erick Dean, Product Director of IoT, at San Francisco-based Splunk. As a result, he has security at the top of his list for IoT trends in 2018, but it’s not all that’s going to happen.
In 2018, security for IoT will be under heavy scrutiny. Cybersecurity risk will increase exponentially as people, processes and businesses continue to connect every part of people’s daily lives, as well as national economies. “We are looking into a future where attacks can be orchestrated not just from public networks, but from private devices such as a smartphones or a smart home,” he says. His other predictions for 2018 go as follows.
2. Major Adopters
Industrial asset management, fleet management in transportation, inventory management and government security will be the hottest areas for IoT growth in 2018. With increasing connectivity between people, data and things, the public sector will begin embracing smart cities, where sensors and automation enhance the reliability of services, especially in the areas of safety and environment. IoT sensor data enables use cases including improved air quality, optimized traffic patterns, reduced safety incidents, traffic fire incident prediction, and improved citizen identity.
3. Digital Transformation
Digital transformation initiatives — especially those centered around customer experience — will drive IoT expansion velocity. Building a technology infrastructure is relatively easy. The challenge is operationalizing data-driven decision-making that impacts the health of the business.
4. Machine Learning
Machine learning and AI represent a tremendous opportunity to IoT. Being able to predict when machinery will need to be repaired, self-optimizing production, and demand response are only a few application examples. With existing network infrastructure likely to be used for “connected things” the investment spend on analytics will be higher as companies find new ways to make sense of the vast amounts of smart device-generated data.
5. IoT Growing Up
Jeff Kavanaugh, VP and Senior Partner in India-based Infosys, told us that while problems persist, the IoT is starting to mature and that enterprises will start trying to monetize the data that is harvested from the IoT. Those that are using the IoT will also start to realize that IoT is difficult “to do.”
According to Kavanaugh, connected devices will become smarter and more immersive, and expectations will increase to convert IoT data to insights and financial value. Algorithms and data visualization templates have now evolved so that new use cases can take advantage of earlier ones. The exponential adoption of IoT will drive down sensor and acquisition costs, enabling more and more viable business cases that have previously been too expensive.
6. Executive Expectations
He added that just as enterprise resource planning maturity raised expectations about foundational data consistency, robotic process automation will raise executive expectations about performance levels for repetitive processes. Companies will get better at scaling automation, moving from interesting proofs of concept to systemic enterprise processes that generate efficiency at scale.
Fast-moving technologies will influence colleges and universities to adopt greater computer programming and data analysis courses. However, universities must complement these with a focus on critical thinking and empathetic skills to meet the growing need of enduring skills in the digital world.
7. Revenue Model Challenges
Los Angeles-based Inspire is a company that simplifies consumer adoption of clean energy and smart home technologies. Patrick Maloney, CEO and of the company points out that despite the euphoria around the IoT, there are no guarantees that companies that make a business out of it are going to make money. There has been no shortage of innovation and new product offerings for the smart home this past year, driven largely by advancements in AI, automation, and voice-enabled technology. This is unlikely to change any time soon. However, he said, going to market is hard, retail shelves are crowded, and products aren’t highly differentiated making it difficult to maintain long-term growth. The revenue models for most smart home products and devices are transactional, one-time purchases.
Unless you are Amazon or Google, creating predictable and capital-efficient revenue streams is not likely. Companies that will succeed in the smart home space are those that can make the transition to a recurring revenue business model, and also create more value and efficiency for the consumer. “Smart homes shouldn’t just be smart for the sake of being smart, but instead improve consumers’ everyday lives. By focusing on smart home services, not just the hardware, we’ll see companies achieve both,” he says.