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IOT is fear-driven phenomenon

IOT has moved beyond hype and money is being made, says Jeremiah Caron, senior VP for analysis at Current Analysis.

IOT has moved beyond hype and money is being made, says Jeremiah Caron, senior VP for analysis at Current Analysis.

The Internet of things (IOT) is a fear-driven phenomenon, but that is okay. This is according to Jeremiah Caron, senior VP for analysis at Current Analysis, speaking at the NetEvents Press and Analyst Summit in Rome, Italy.

"There are a number of issues within the IOT enterprise space that are causing fear. Enterprise players feel if they are not on top of IOT innovations, they are at risk of falling behind or being completely obliterated by new business models and new approaches that use IOT techniques," according to Caron.

He says IOT has moved beyond the hype and has become a reality for many companies in the enterprise space that are beginning to use it to make money, or making plans for how they can make money in the future. He says there is an increasing opportunity presented by IOT that is commanding attention among businesses looking to create a competitive advantage.

Caron says there is a big emphasis for enterprise organisations to make sure that if they are not innovating, they are at least keeping pace with what is going on as IOT grows.

"We are at the market tipping point of IOT; it's a reality unlike other hyped concepts. Money is being made so it's gone beyond just hype and become a reality out there."

Caron shared some results of a new study from Current Analysis that is focused on how IOT can be used in the enterprise space.

Over 1 000 enterprises, both IT and line of business, were surveyed across the globe, including in Africa. This encompassed companies already using IOT or planning to, and those that have rejected the idea.

Preliminary results found security systems are the number one use case for IOT. The second most implemented IOT solution was for tracking employees, followed by energy management, product testing and quality control, and asset tracking.

The study found the scope of deployment remains fairly low, with most deployments consisting of less than 2 500 devices, while 58% of companies had less than 500 devices deployed. Two-thirds of companies' deployments were on either a local (within city/metro area) or national level. Around 23% had regional deployments and only 10% had global deployments of IOT devices.

The study found most IOT projects incorporated frequent communications (multiple times per day), while only around 20% of projects were using real-time communications.

"The real-time applications are relatively few at this point. We'll see how that changes over time."

When it comes to investment, companies are not only spending money on specific IOT devices or applications but fairly evenly across all IOT-supported technologies. This includes cloud services, software infrastructure, network capacity, networking hardware, servers, WAN hardware, storage and sensors.

"What's interesting is they're spending money on all of these things. So another reason why IOT is, yes I agree, overhyped but also extremely important for our industry is because every single sector stands to make money on an IOT deployment.

"It's not just the service providers. It's not just the professional services companies or storage companies or sensor-makers. There's often talk about this is where the real money is, but in fact all of these areas are involved in a deployment and it's an opportunity therefore for companies in all of these areas. And so that's why you see so much attention from everybody in the marketplace," according to Caron.

Improved operational efficiencies was listed as the key driver for the majority of organisations when asked why they were implementing or planning to implement IOT. Cost reduction was the second most important, followed by increased revenue from existing products and services. Of lower importance was enhanced insight and decision-making, as well as increased revenue from new products or services.

In terms of inhibitors making IOT deployment difficult, the study found that resolving security concerns was a top challenge to getting IOT projects up and running. The other top two concerns were proving the value to key stakeholders and justifying overall cost and return on investment (ROI).

"The big challenges are all areas where vendors and service providers and integrators can help. They can help enterprises get over those top three inhibitors. So it's a challenge to the supplier community. The challenge isn't really to make cool technology, you have to do that. But rather the challenge is to help companies get over those top three inhibitors," says Caron.

Around 40% of businesses expect their project to pay off in one to two years, while 35% expect it to pay off in six to 12 months. Among respondents that have already implemented IOT, over 60% indicated their project had already met their ROI expectations.

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