I’m thrilled to be joining ESG and leading their focus on the Internet of Things. While I’m new to ESG, I’m not new to the analyst community nor the world of mobile and disruptive technology.
What’s great about ESG is that I’ll be joining a group of smart, experienced professionals who have spent years understanding the challenges of enterprise technology leaders and advising the ecosystem in so many of the areas IoT touches. I’ll be using this space to share my ideas and thoughts on the rapidly expanding IoT market, and here are some of the concepts that will guide my analysis going forward.
So How will ESG Think About the Internet of Things (IoT)?
There are many definitions of IoT, but here is how I like to think about it:
One definition is that:
IoT is the end-game of internet computing, where traditional personal computing devices (such PCs, smartphones, etc) and the web are no longer the primary interface to data.
Another way to define IoT:
It is the final blurring of lines between the digital and physical worlds. Or in other words, all “things” can begin to yield information that can be turned into bits and bytes of data.
In this sense, IoT becomes part of broader digital transformation initiatives that enterprises are undertaking.
And if those two definitions hold true, then we can think about IoT as the intersection of IT (information technology) with OT (operations technology). Some may refer to this as the "Industrial Internet", where the distinctions between high technology and industrial technology ultimately disappears.
A Clash of Ecosystems
It’s instructive to think about what this intersection means. Over the past several years, the IT ecosystem has been evolving, with new a computing paradigm that has mobility, cloud and analytics acting as key disruptors. Mobility, in particular, has resulted in what was historically the telecom ecosystem being more engrained into what we traditionally think of as IT. Essentially IT has truly become ICT (Information & Communication Technologies), a term that has been used extensively in Europe.
OT, on the other hand, is inclusive of technology in industrial environments (think power grids, railroads, airlines, manufacturing, healthcare, etc), which have, in most cases, existed in isolation from IT. Furthermore, OT in different industries are isolated from one another — something that IoT has the potential to change as well.
What this means, of course, is that an entirely new ecosystem for IoT is formulating. One that incorporates large enterprise IT vendors (IBM, Oracle, Dell, HP, SAP, Amazon, Cisco etc), large mobility and device players (Apple, AT&T, Verizon, Samsung, Qualcomm, Intel, etc), industrial technology giants (GE, Honeywell, Siemens, Bosch, etc), and other IoT specific vendors (PTC, Jasper, Bug Labs, etc).
Why is IoT Accelerating Now?
IoT is not necessarily new, particularly when it comes to the industrial world. Terms like M2M (Machine-to-Machine), Telemetry and SCADA have been used at various points historically to describe solutions which connected devices to a network to communicate and gather or exchange data.
But IoT is different, and its largely due to the fact that the technologies powering the IoT have seen profound change over the past decade. Today, these foundational technologies have matured and have become increasingly mainstream. They include: cloud computing and XaaS models; big data and analytics; sensors, chips and semiconductors; mobile networks and applications — to name just a few critical aspects. Additionally, the cost of deploying these foundational technologies have gone down significantly, particularly in the areas of sensors and chips, bandwidth, storage, memory, and processing power. Put these together, and we have a perfect storm of technologies to fuel the expansion of IoT.
IoT Opportunity Also Means Complexity
For enterprises, IoT has broad impact. Most large enterprises have been focused on digital transformation initiatives. Much like the promise of digital transformation as a whole, IoT holds promise for businesses to create value in areas such as operational efficiency, customer engagement, enhanced products & services, and new business models. But IoT becomes another piece of the puzzle to solve: it becomes entwined with data/analytics, mobility and application strategies.
Furthermore, this means that, once again, technology leaders must rethink their approach to enterprise IT. IoT initiatives by their very nature create new challenges for businesses because of two distinct factors: First, they are inherently large and distributed, with a vast array of sensors and devices spread out across a physical environment. And secondly, they necessitate the integration of IT and OT. This has implications across traditional enterprise IT landscape, including infrastructure, applications, security and analytics/data management. To accomplish this, organizations must acknowledge that this requires a more sophisticated end-to-end approach that places all of these capabilities across an IoT environment — meaning from data center to the cloud and to the edge where IT meets OT.
Solving the IoT Puzzle
To begin solving the IoT puzzle, several big questions need to be answered. These questions will serve as the foundation for ESG’s IoT research in months ahead. While each of these questions have many sub-components, here are some of the key things we’ll be exploring:
- How do businesses realize the benefits of IoT? Meaning, how can organizations harness the power of data from connected sensors and systems to achieve operations efficiencies, improved customer engagement, enhance products and services, or introduce new business models?
- How do enterprises solve the complexity and technical challenges that IoT represents? Specifically, what does the intersection with OT have on existing approaches to IT, such as infrastructure, applications, analytics and mobility? And how does IoT fit into broader digital transformation initiatives?
- How will the IT & OT ecosystems come together to help businesses implement IoT initiatives? Who are key emerging IoT players? How do large traditional enterprise IT vendors address IoT needs of existing customers? What is the role of industrial technology companies, and how do all of the above partner to create complete IoT solutions?
As we seek to answer these questions and more, I’ll continue to post thoughts here on the blog. So if this has piqued your interest, visit often, and don’t hesitate to contact me with your thoughts and suggestions.