The IoT Put to Practical Use: From Projects to Business Models

Although the Internet of Things (IoT) is making massive strides, development of the associated technology – which, in my opinion, numbers among the most exciting IT innovations over the past few decades – is still in its early stages. We still don’t know where the IoT will take us, but analysts have yet to revise their predictions for IoT development. Some of these are quite lofty: For example, certain sources predict that 26 billion IoT objects will be in circulation by 2020, while others have estimated this amount at a staggering 50 billion. Recently, I was surprised to read the following claim regarding IoT development: “In the future, we will be able to integrate nearly any desired physical object into the digital world.”

Enough is enough: I feel compelled to set the record straight. The purpose of the IoT can’t be to integrate ‘nearly any’ object; the underlying principle isn’t to exhaust the limits of technical possibility. There needs to be a practical business model in place behind any IoT application; without this, even the most impressive-seeming networking will not really amount to anything. As I see it, precisely therein lies the most important IoT-related gain that has been made over the past year: The IoT has outgrown the trial stage and become an established, integrated component of business models. The focus has shifted from trying to identify all the possibilities that the IoT has to offer towards using the IoT to make processes more efficient, as well as to enable entirely new processes. In concrete terms, this involves leveraging the IoT to generate revenue and/or save on costs. As such, the IoT is increasingly becoming a fixed component of many business models. Over the course of this development, several preferred areas of application have emerged. Below, I’ve put together a brief overview of the IoT projects we have implemented.

The smart home is often considered the IoT field of application par excellence, incorporating intelligent heating, sensor-controlled curtains, and, of course, the famous IoT refrigerator. While these applications elevate user comfort and security, they are not critical (except, perhaps, to the manufacturers behind them) in the sense that they haven’t become indispensable. For that reason, smart home innovations remain a niche market. Moving beyond the scope of user homes, I feel that the IoT is being put to excellent, practical use in commercial applications.

Industry and production: I don’t want to dredge up the well-worn example of elevators – that would be a disservice to the vast breadth of exciting applications currently used in the field of industry. For example, an Irish company is using an IoT solution to seamlessly monitor concrete production through all phases, from the manufacturing stages to provision at construction sites. This lets employees know precisely when concrete is dry, which allows them to further process it accordingly. Doing so no longer requires estimates or security buffers – which saves a great deal of time, and, therefore, costs.

Agriculture represents a frequently underestimated area of industrial production. The IoT has also taken root in this field – for example, a farm in India uses the IoT to control the health and milk production of its 6,000 head of cattle in real time. This immediately results in improved yields.

Retail: What works for concrete, also works for food: A large British supermarket chain with around 3,000 stores is using the IoT to ensure that the refrigeration chain for frozen products remains uninterrupted from the manufacturer’s facilities through to points of sale, and that the relevant cooling systems are used efficiently so energy isn’t wasted and food doesn’t spoil.

Energy: Many IoT applications are used in the generation of alternative energies. For instance, a Spanish manufacturer is using an IoT solution to monitor and control decentralized photovoltaic systems in a centralized way. This solution also includes weather sensors to enable quick responses to local conditions.

Meanwhile, in the field of healthcare, the frequently discussed fitness trackers are just the tip of the iceberg. In this industry, IoT systems are also used to monitor patients’ cardiac activity or blood sugar levels in their home environment so that the duration of hospital stays can be shortened; automatic alerting of emergency services can be life-saving in this context. Meanwhile, a retirement home in Thailand used an IoT system to reduce service response times by 50 percent, improve resident satisfaction, and reduce the number of nursing staff.

The IoT also plays a decisive role in the smart city. Municipalities use IoT applications to measure traffic flows in real time, which allows them to respond very quickly to congestion on particular routes. Other IoT applications enable intelligent control of street lighting, which sinks energy costs without sacrificing comfort or security for citizens.

All of the above examples illustrate that outside of corporate environments – or ‘out in the field,’ so to speak – IoT solutions often represent the sole means of receiving information about processes in a timely manner and, conversely, of immediately taking measures on-site that are necessary to optimize said processes. The IoT is already being put to practical use, but there is still a great deal of untapped potential as far as this is concerned. We can look forward to new and exciting application scenarios in the future.