Is the IoT on the way out? – From pure technology to new business models

The Internet of Things (IoT) refers to the interconnection of physical devices, vehicles, buildings and other objects that are equipped with technologies to collect and exchange data. This interconnection makes it possible to optimise processes, reduce costs and develop new business models. 

The development of wireless technologies and edge devices

In recent years, it has often seemed as though a new technology has emerged almost every month, either to solve a specific IoT problem or to replace an existing technology with a more efficient one. Examples of this include numerous wireless technologies such as Sigfox, followed by LoRaWAN, NB-IoT and LTE-M, which were launched in quick succession. They offer different levels of performance in terms of energy consumption, bandwidth and availability, making them suitable for a variety of use cases. In addition, there are other wireless standards that never made it out of a niche market or were developed specifically for a niche. 

There has also been rapid and significant progress in edge devices and associated software. Edge devices collect and process data directly at the source before forwarding it to central systems, thereby reducing latency and network traffic.  Finally, IoT platforms have also undergone a similar evolution, characterised by a constant stream of new features, specialisations and protocol support. 

From technology to application

The frequency with which innovations in the IoT sector are coming to market has decreased significantly in recent times, and progress is now taking place on a rather small scale. So is IoT out of fashion and has it been replaced by something else? In fact, the agenda is currently no longer dominated by IoT, but by artificial intelligence in all its forms. However, this does not mean that IoT is no longer relevant or that it no longer exists – quite the opposite, in fact. 

If we look at the Gartner Hype Cycle, the IoT has definitely reached the ‘Plateau of Productivity’. The Gartner Hype Cycle describes the development of new technologies in five phases: 

The IoT has gone through these phases and is now an integral part of products and services across many sectors. This is accompanied by a certain sense of calm surrounding the topic, precisely because it is no longer just hype, but a reality in practice. Furthermore, the focus of the IoT has shifted from pure technology towards practical applications such as the connected car or self-service tool dispensers. Technology alone does not generate new revenue nor does it reduce production costs. It is only when it is embedded in processes and integrated into complete solutions that it generates added value. 

It therefore makes little sense to celebrate new technologies in this context. Instead, topics such as ‘new business models’, ‘digital enhancement of products’ or ‘cost reduction’ are coming to the fore. The specific technology used is of secondary importance, provided the right decisions are made. It is helpful to work with experts who have experience in both areas in order to be able to make the relevant connections and draw the appropriate conclusions. 

IoT in the context of new business models

Numerous business models can no longer function without the IoT. New revenue is often generated through digital additions such as mobile apps, without the need to update the actual product. Approaches such as condition monitoring or predictive maintenance help to reduce costs in production and operations. Condition monitoring involves the continuous monitoring of machinery and plant to identify maintenance requirements at an early stage and minimise downtime. Predictive maintenance refers to the proactive planning of maintenance work through the analysis of sensor data, in order to avoid unplanned breakdowns and increase efficiency. For all these areas, the IoT is required as a foundation to provide the necessary data. 

The IoT is therefore not a thing of the past; rather, it has evolved from a hype to a workhorse that operates in the background. It enables the digitalisation and optimisation of processes and lays the foundation for innovative business models. 

You can find information on Materna’s IoT solutions here.