Now entering its fifth year, the 2017/2018 Vodafone IoT Barometer report was released this month, reviewing the growth of the IoT over the past five years, what is to be expected over the course of the next five, and other key facts and findings around how the IoT is being used in enterprise today.
IoT adoptions have more than doubled since the first barometer report was published; in 2013 M2M/IoT adoption was just 12%, but in 2017 it is now at 29%. The report also highlights that companies are spending more on IoT than they were 12 months ago, and that many companies have increased the number of devices they have connected (more than 50,000). The results also show that enterprises are seeing significant return on investment, with IoT adopters posting an average increase in revenue of 19%. By looking at these results it’s clear that IoT is increasingly becoming an integral part of enterprise strategy.
The State of the Market
As noted above, the proportion of companies using IoT (known as adopters) has more than doubled since 2013. According to the report, adoption is up in every industry compared to five years ago, with industries such as manufacturing jumping from 11% in 2013 to 30% in 2017. Other key points to take from the report were that:
- 12% of adopters now have at least 10,000 connected devices, and the share with over 50,000 connected devices has doubled from 3% to 6%.
- Adopters are using IoT to cut costs, reduce risk and increase revenue, but the main focus is on increasing efficiency (55% of adopters cite this reason).
- Adopters are now embedding IoT within their business processes – 46% have integrated it with core systems, such as enterprise resource planning (ERP).
The dramatic increase of IoT adoptions over the last five years highlights that businesses have begun to reap the benefits of the Internet of Things:
- Those with the most connected devices are seeing the biggest gain – 28% of adopters with under 100 devices reported a significant return, going up to 67% among those with over 50,000 connected devices.
- Return on investment can be significant – organisations reported a significant increase in revenue since adopting the IoT, averaging 19%.
- 88% of adopters that report seeing significant benefits from IoT say they’re spending more on IoT now than 12 months ago.
- More than half (51%) of adopters say IoT is increasing revenue or opening up new revenue streams.
- 49% of adopters are using IoT in conjunction with analytics to improve business decision-making and business transformation.
The report states that security is still at the top of the list of concerns for IoT – a factor concerning adopters since the first barometer report was published in 2013. Since then however, according to the survey, organisations are now more willing to tackle such concerns on a hands on basis. The report highlighted how the following concerns have been addressed by adopters:
- Security – 7% of adopters with at least 10,000 connected devices say security is their top concern, compared to 19% of those with smaller IoT programmes.
- Insufficient resources/skills – 75% of adopters have now increased their use of partners to deliver/manage IoT projects.
- Secure, reliable connectivity – The top considerations when choosing connectivity for IoT projects are security (75% of adopters) and network coverage (74%).
- New connectivity options – 28% of those considering IoT are looking at LP-WAN, with its promise of greater coverage and cost efficiency, and 40% are investigating 5G.
The Next Five Years
So what’s next for the IoT? The report highlighted the following expectations from adopters:
- 79% think that IoT will have an enormous or sizeable impact on the whole economy in the next five years.
- 79% of adopters say that in five years, over 50% of business processes will include IoT sensing/control systems.
- 79% think that more than half of enterprises will be using AI and machine learning (where computers learn from their own experience) to make sense of IoT data.
- 72% of adopters expect security and privacy concerns will be greatly reduced, opening the way for increased use of IoT.
- 80% of adopters think many companies will be collaborating with other companies in the same industry to build joint IoT solutions.
Since its infantry days of M2M, IoT has come a long way in five years. New technologies such as NB-IoT are also now beginning to evolve, paving the way for the next wave of IoT adoption over the course of the next five years. To read the full Vodafone IoT Barometer report, click here.