In this episode, 7 Layers digs deep into IoT’s impact on the enterprise, looking at both emerging enterprise use cases and how the growth of IoT devices impacts how enterprises build and support their IT infrastructure.
Hello, and welcome to 7 Layers where every episode we take a look at a different technology that connects our world. From literal wires in the ground to switches and routers, and all the way up to the exploding amount of smart devices around us.
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As I talked about way back in episode three, “IoT Part 1 — You, Me, and IoT,” the Internet of Things, or IoT, impacts much of our daily lives at this point. It’s been over a year since that episode, and with IoT seemingly poised to take over our lives, it felt like a topic worth revisiting. And while in that episode I discussed in length the impact IoT is having on our personal lives and its implications for mobile infrastructure, in this episode, we are looking beyond the consumer use cases of IoT and talking about the IoT use cases that impact businesses, government, and potentially society as a whole. In this episode, we will cover:
A brief review of IoT’s basic definition
Enterprise IoT use cases
IoT market segments
And the impact of IoT on enterprise networking and data centers
Alright, are you ready? Let’s get started.
PART 1: The Enterprise IoT Market
Let’s start with a quick recap. IoT describes a breadth of devices that connect to the internet, communicate with other connected devices via wireless networks, and use embedded sensors.
Examples of IoT devices include autonomous vehicles, smart appliances, and wearable tech. One handy tool for determining whether something falls under the IoT umbrella, in my own personal experience, is if you hear about it and your first reaction is, “Why does that need to be connected to the internet?”
I’m looking at you smart rectal thermometers!
However, in all seriousness, the range of use cases and IoT’s potential continue to expand, for better or worse. The IoT market has a wide range of subcategories in its umbrella, I can’t hope to cover them all in 20 minutes. So for today, I’m going to go into detail on
Let’s start with enterprise IoT, which has some overlap with the consumer IoT space. Particularly when it comes to security systems and building equipment like smart thermostats or lights. For example, Ring offers security systems for small businesses and SimpliSafe has security systems for multi-site organizations.
Continuing on the idea of smart security systems, a smart building may use an IoT surveillance system that, for example, only sends video that includes motion to the cloud for storage and later review.
Smart buildings also will use smart thermostats, lighting and other sensors to determine how many people are in a given area and adjust the temperature and lighting accordingly to conserve energy and save money.
IoT use cases for enterprises differ most strongly from consumer use cases when it comes to smart metering, asset tracking, detecting water and gas leaks, monitoring water quality, and predictive maintenance of pretty much any type of machine.
In Europe. For example, the Trafair project is a research project determining air pollution levels in urban areas to help achieve one of the UN’s sustainable development goals for 2030.
One of this project’s goals is to provide government officials with the data necessary to take action in reducing urban air pollution.
Another example is the U.S.-based company, The Detection Group that sells its Trident wireless water leak detection system for a multitude of verticals. It is an IoT device that uses a cloud-based management platform to send notifications when a water leak is detected.
When it comes to asset tracking via IoT devices. Shipping organizations are a primary example. These devices can be RFID chips and scanners, cameras that monitor inventory shelves, or GPS trackers on delivery vehicles. IoT devices for asset tracking send their data to a local private edge node or to the cloud for storage or if the device requires automated decision making. An edge node is preferable when latency is an issue.
With these examples, employees and customers can access the data or media from the edge nodes or cloud to see where their shipment is and whether inventory needs to be restocked. inventory tracking is also important in a retail setting, or even a manufacturing setting to verify materials or component parts are in sufficient quantities.
Other types of enterprises can benefit from asset tracking as well. Construction companies can keep better track of tools and equipment. Pharmaceutical companies can be alerted to changes in temperature when sensitive medications are stored or shipped. enterprises more generally can monitor the location of work issued employee laptops to avoid theft.
IoT devices can help ensure human safety by detecting water and gas leaks. This can be in residential, business or industrial settings. Purpose-built IoT sensors can collect data on the water or gas they monitor to determine when there is deviation from the norm.
IoT devices that detect water and gas leaks can use the cloud to report the status of the infrastructure when critical conditions arise. Operators also use the cloud to issue directions to the devices to shut off water or gas. In some cases, the devices can make automated decisions for shutting off the system themselves.
This type of resource monitoring and redistribution leads me right into smart cities. Market reports recorded the 2020 global smart city market size to be $113.1 billion. By 2025 it is expected to grow at a compound annual growth rate or CAGR of 18.1% to reach $260 billion.
To continue with a domestic example, as far back as 2015, the Obama White House started the Smart City initiative. It included a key focus on developing test beds for IoT to assist in connecting cities and utilizing smart sensors.
Major drivers for smart city market development include carbon emission reduction, crime reduction and traffic management.
To realize smart city goals, governments from multiple states and countries are beginning public-private partnerships to begin smart city development. These goals require IoT sensors to be spread throughout the city along with sufficiently advanced AI to analyze the resulting data.
A major part of living in the city is paying your landlord for utilities, which is another market where IoT is making an impact.
Research reports indicate expectations for the IoT utilities market to grow from $28.6 billion in 2019 to $53.8 billion in 2024. That’s a CAGR of 13.5%.
The IoT utilities market segment that’s expected to hold the largest market size is the electricity grid management market segment. The IoT devices involved here are smart sensors, receivers, and energy boxes all capable of communicating with each other.
With these tools in place, utility providers are alerted to issues in the grid faster and without having to learn about an adage from customers.
And finally, manufacturing. The global IoT manufacturing market size in 2020, was recorded as $33.2 billion. Researchers looking ahead to 2025 expect the market size to reach $53.8 billion. The CAGR there is 10.1% over the five years.
Within manufacturing, industrial IoT is the hot use case. And it’s one of my favorite aspects of IoT, as I’ve mentioned before in this podcast. Is this because my dad’s a machinist? Probably.
An area often talked about with industrial IoT is predictive maintenance. This can be for machines found in factories, machine shops, or HVAC systems, for example. Traditionally, machines are maintained on a regular schedule that is not based on an individual machines level of use.
IoT sensors installed in a machine detect the actual wear and tear on the machine’s parts, so replacements only occur when needed. This reduces waste of ditching parts that are still effective, while also reducing machine downtime because only the necessary parts are replaced.
IoT sensors in industrial machines can also detect unexpected breaks before they happen, again minimizing machine downtime and time spent troubleshooting.
In manufacturing, the IT infrastructure that IoT devices interact with are either on-premises, in a private edge node, or in the cloud. Researchers report that the cloud deployment market subsegment will grow at a higher CAGR than the on-prem market subsegment.
Using a cloud based model means a third party becomes involved to provide the cloud infrastructure and potentially manage the IoT infrastructure for the manufacturer. A manufacturer can save money by shifting its cost to subscribing to a cloud service, instead of deploying and maintaining one or more private edge nodes.
A manufacturer may still prefer to swallow the costs of an on-prem deployment in order to have total control over their data storage for privacy or security reasons, as well as to ensure low latency for computing tasks.
But let’s not forget a hybrid approach where a cloud is used for some of the IoT tasks and a private edge node is used for others.
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PART 2: Impact on the Network Edge
Now, we here at SDxCentral are huge nerds about IT infrastructure. And since you’re listening to this, I would hope you are too.
Cisco’s Annual Internet Report white paper predicts that by 2023, there will be 14.7 billion IoT devices and they will account for 50% of all networked devices. This does include consumer IoT devices, however, with the total number of devices reaching nearly 15 billion, there’s still going to be a lot of enterprise IoT in the mix.
This explosion of IoT devices is driving increased infrastructure complexity as organizations rush to support these devices. This growth also has some interesting use cases for data center infrastructure, both in supporting IoT devices, and in advanced data monitoring and management for the data generated by IoT devices.
Let’s start with the increase in network complexity. Once an organization deploys large numbers of IoT devices onto its network, all these new devices are now new network endpoints with a high degree of interconnection. These new endpoints must work together and work with the overarching IT infrastructure — often requiring more network infrastructure to be rolled out.
For example, in an industrial setting, such as a manufacturing plant, the many different types of IoT sensors and devices require just as many unique API’s so they can all communicate with each other. Creating, integrating and maintaining those API’s is a mammoth task for IT personnel.
What may be the most challenging part of working with a large IoT deployment is managing these new endpoints. To address this, IT departments need robust management and monitoring software that can capture a holistic view, including all of these new endpoints.
IOTech is one of the many vendors offering IoT management platforms that specialize in edge deployments. I recently spoke with IOTech’s Product Director Andrew Foster, who emphasized the importance of such management software for edge IoT deployments.
He said, quote, “Vendors, such as IOTech, are really heavily focused on developing new management infrastructure that has been designed to suit the needs of, particularly, the IoT at the edge because how you manage applications in the cloud is very different to how you manage applications in the edge environments. The type of nodes that you run on, the resource constraints, the connectivity constraints are very different. So there’s a new generation of edge management software or solutions that are being developed by not just my company, but a lot of other vendors in this space, which are being rolled out to address the problem of managing not just the application side of IoT, but the nodes themselves at scale.” End quote.
Without a way to manage and visualize the IoT devices in the network, an enterprise leaves its now-expanded attack surface vulnerable. And IoT devices are very susceptible to corruption.
For example, the Mirai malware in particular is a popular tool used by hackers to compromise poorly protected IoT devices to turn them into bots for distributed denial of service attacks.
Learn more about IoT vulnerabilities in my article, “How Is the Internet of Things Vulnerable?” on SDxCentral.com. You can find a link to it in this episode’s transcript also on SDxCentral.com.
There has been a lot of talk in this episode about IoT and the edge. The two are often linked together because IoT devices often need to offload their computation tasks.
To quote the Cisco report I referenced earlier, “Edge networks and computing allow enterprise architectures to optimize processing for business-critical analysis of datasets from IoT applications and communications.”
The edge is a somewhat fluid concept and what counts as the edge, quote unquote, can be argued differently by different companies. The definition I’ve landed on is this: the edge is the placement of IT resources closer to the end user than a central data center.
Some examples of edge deployments that I have seen in my research include colocation facilities, network points of presence, on-premises data centers, and cellular base stations with excess resources.
That list is by no means exhaustive, and I’m sure I’ll get some emails over what I neglected to include, so keep an open mind to what the edge can be and before you debate the subject, do some additional research.
Something else that tends to come up in my research is the fuzzy line between IoT devices that support business objectives and IoT devices that act as part of the edge infrastructure. For example, I have read articles that will say that IoT devices have little compute power and must rely on the edge for compute resources, and then a few paragraphs later, say how IoT devices can provide compute power at the edge.
Some clarification I have found is that the supposed IoT devices that provide the compute power are somewhat misnamed, they’re really just edge devices.
IoT devices just generate data and send most of it to devices in the edge node. The edge devices receive that data, make it readable for analysis software, or process the data for the IoT device.
In short, I devices are the endpoints generating the data, and the edge devices are what handle that data.
Thanks for joining us on this week’s episode of 7 Layers.
Before you go, let’s do a brief overview of what we discussed today:
We reviewed the basic definition of IoT
We looked at enterprise IoT use cases
IoT market segments
And the impact IoT has on enterprise networking and data centers
I’ve been your host, Connor Craven, associate studio editor at SDxCentral. Follow 7 Layers so you never miss an episode, and tune into our next episode where I’ll be interviewing Steve Hilton, co-founder and president at MachNation. As always, you can learn more about the current state of technology over on SDxCentral.com.
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Thanks for joining us and I look forward to our next episode.