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By Dan Shey, Vice President and IoT Practice Director at ABI Research

Will IoT be as interesting 50 years from now? Heck yes! Why? One simple reason is there is conceivably no limit to what can be connected. Consider a few simple global statistics: Nearly 50 million commercial buildings; over 30 billion packages shipped every day; twelve billion acres of land used for agriculture. This is just three markets where we have only scratched the surface for application of IoT technologies!

IoT hardware including sensors and connectivity devices starts the IoT solution journey. Investment in sensor technologies is increasing both for inclusion in machines but also as separate devices appended to machines or things. Connectivity technologies transport data back to applications and databases. Wireless has been a big area of investment and will continue to be. But the market has not even tapped the potential for other forms of connectivity such as from sound and light.

Sensing and connectivity are just the beginning of the IoT solution journey. Then there are applications and all the services that move IoT data so it is consumable by applications, sometimes called application enablement. This is followed by the end-goal of the data collection effort – insights – which requires mastering the manipulation of data and application of analytics. But IoT is not just a solution by itself, it contributes to the business processes of the enterprise meaning IoT data needs integration into the multiple functional areas and digital domains of the company – everything from operations to product development and even into HR. Finally, the connected things and machines need to be maintained and monitored to address security and lifecycle management requirements.

Interestingly, sensing and connectivity hardware when viewed across all IoT markets is only 10% to 20% of IoT solution costs. Most of the IoT supplier revenues are made in services. But this relatively small investment in hardware starts the magic of IoT!

All of these solution options portend complexity for the user environment both in technology and supplier choice. And it will require a broad array of suppliers - the physical world is far too complex to assume only a few suppliers can address an end-to-end solution. Even the hyperscalers know this which is why their partner programs are so critical to them. The challenge but also opportunity for the broad swath of suppliers serving the IoT market is how to bring simplicity to complexity.

Because we can connect something does not mean it should be connected. But the history of M2M and now IoT shows a whole lot of value from connecting things and how much we don’t know about our physical world. And for that reason, in 50 years, the IoT market will not only be a more important economic accelerator but even more interesting than it is today.