The Industrial Internet of Things (IIoT): innovation

The Industrial Internet of Things (IIoT): innovation, benefits and barriers

The Industrial Internet of Things (IIoT): innovation, benefits and barriers

The Industrial Internet of Things (IIoT) is a name for the Internet of Things as it is used across several industries. However, just like the Internet of Things in general and the Consumer Internet of Things, it covers many use cases, industries and applications.

The Industrial Internet of Things is defined as ‘machines, computers and people enabling intelligent industrial operations using advanced data analytics for transformational business outcomes” (see infographic at the bottom).

Among the often mentioned industries in IIoT are manufacturing, aviation, utilities and energy, oil and gas, logistics, transportation and more (see below). The Industrial Internet of Things is the biggest and most important part of the Internet of Things now but consumer applications will catch up, probably starting 2018. Some data, evolutions, benefits and challenges regarding industrial IoT.

Initially the main purpose of IIoT was to automate, save costs and optimize but today the focus is more and more on innovation too.

The Industrial Internet of Things enables industries to rethink business models. Generating actionable information and knowledge from IIoT devices, for instance, enables the creation of a data sharing ecosystem with new revenue streams and partnerships.

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The Industrial Internet of Things is often used in the context of Industry 4.0, which is the term that describes a new industrial revolution with a focus on automation, innovation and data. On top of IIoT, Industry 4.0 also is about other technologies; which are related with it.

Examples include robotics, cloud computing but also the evolutions in operational technology (OT). In the Industrial Internet of Things, IT and OT need and meet each other. Industry 4.0 further refers to cyber-physical production systems(CPPS) and typical embeds the so-called third platform technologies and accelerators of the DX economy.

Despite the link with factories, manufacturing and heavy industries like mining, , aviation, oil and gas, defense, power and electricity and energy overall, the IIoT is often used to describe most Internet of Things applications outside of the Consumer Internet of Things.

So it is also about industries such as agriculture, logistics, finance, the government sector (including smart cities), public transport, utility firms, healthcare (hospitals) and others.

Below are a few typical IIoT use cases and business contexts.

The market opportunity of the IIoT is big. According to IndustryARC research (June 2016), the industrial IoT market is estimated to reach $123.89 Billion by 2021 at a high CAGR, as we cover in our Industrial Internet of Things market state and outlook 2016-2017. In the graphic below you can also see some forecasts by Morgan Stanley, data on the impact of IIoT on the global economy by Accenture and another forecast from Research and Markets. Leaders in the IIoT space, such as GE, also have impressive forecasts but of course it all depends on what you exactly measure and how you define IIoT.

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Although the Industrial Internet of Things is poised to grow significantly, challenges remain. The infographic by Visual Capitalist at the bottom of this article shows a few, as does research by Morgan Stanley and others. An overview of IIoT challenges as perceived by executives.

Industrial data is complicated for the reasons mentioned in the infographic (based upon IDC 2016 data), of which most also are among the (big) data challenges of our times.

Think about the variety of data source types, big data volumes (certainly in ‘heavy’ industrial applications), varied date frequency and complex data relations. The answer, just like in the big data ‘chaos’ picture overall: intelligent data systems.

Data integration is the number one barrier according to the research with 64 percent of respondents. It’s the eternal challenge of moving from data to business value, which becomes clear in the IIoT context.

 



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