Understanding the Internet of Things

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We are currently living in the Information Age, a time period resulting from the Digital Revolution, when focus is being shifted from industrial processes to digital information and, even more recently, data. This shift is done through Digital Transformation, which looks to integrate digital technologies in all of the areas of a business.

Digital Transformation uses data to make decisions and reform strategies, both in companies as whole as well as in equipment, which is to be automated whenever possible. So, it is no surprise that most new technologies are data-focused: how to collect and source information, how to store, secure and, finally, process, analyze and apply this data. The Internet of Things (IoT) is both part of the objective of the Digital Transformation and a way to get there.

 

IoT

IoT, the Internet of Things, is a network composed of objects that can collect and share information among themselves. These objects can really be anything, from lightbulbs to entire machines. The idea is that they can communicate with each other, sharing data and sending signals.

One famous example of IoT is a smart home (“smart” means IoT), where everything is connected and can be programmed — windows and doors, appliances, heating, lighting and so forth. However, the real gain with IoT is not controlling objects, but collecting information about the world, learning from this data and teaching these objects to apply it in order to work better, faster and smarter.

So, in the example of a smart home, windows can learn when to open to circulate air or let sunlight in, regulating the temperature naturally. A smart thermostat is able to tell it doesn’t need to heat or cool the house, then. The communication between the objects can teach them how to be more efficient and can save the house owner some money to boot.

Although smart homes are interesting, the real benefits of IoT can be found in businesses — from offices, to factories, to whole operations that deliver goods directly to clients. In these cases, IoT can collect data on machines, people and infrastructure. This information, when analyzed, can show patterns for preventative and predictive maintenance in equipment, find productivity bottlenecks and make operations more efficient. IoT is both the way to collect data as well as the way to enable edge decisions (decisions made in the equipment, without the need for commands from a central system).

 

Challenges

IoT already exists, only in smaller and more isolated ways. There already are smart thermostats available — Nest, for instance —, lighting that works with motion sensors and personal assistants — like Alexa, from Amazon or Google Assistant. There are even multiple-purpose devices that can be worn — wearables —, such as smart watches and glasses.

These devices can help with some tasks, but don’t make up a large network. This means that, although the Internet of Things is already a reality, it also has a long way to go before it can reach its potential and usher in true Digital Transformation.

Thus, IoT faces many challenges. The first is dealing with legacy systems and equipment. Any business or factory already has them in place and it is impossible to simply swap all machinery or alter every business system in use to include smart devices.

One of the main strategies, in cases such as these, is to smart small, installing sensors in existing equipment to collect data from these machines. Adding sensors is much cheaper and faster, but not a long term plan. But the information collected can begin to be analyzed and help shape new systems in the company.

The second challenge is dealing with the huge amounts of data collected. Initially, sensors might be focused on one or two variables — for instance, machine vibration and temperature. Even then, the amount of information collected by all of the equipment in a production line overtime can be overwhelming. When machines can collect multiple variables, the amount of data is enormous.

These huge amounts of information cause several problems, since they need to be stored and processed in order to allow IoT to reach its fullest potential. This problem is being addressed through Big Data, the study field focused on techniques and technologies to store and process these big masses of information. Big Data does, however, require specialists and infrastructure, so it must be built along with the IoT infrastructure itself.

Another challenge for IoT to be effective is connectivity. Currently, connection between smart devices is mostly done either through Wi-Fi, 4G or specific network systems, such as LPWA (Low Power Wide Area) networks. The problems with these options are related to the network’s response time (latency) and reliability, as well as the large amounts of devices connected to the network.

5G technology, which is estimated to reach speeds up to 34 times faster than 4G networks and provide much better reliability, is an answer to IoT’s connectivity issues. It will be a lot more reliable and, with much lower latency and faster speed, 5G will allow devices to be connected to each other, sharing information faster than human reflexes.

However, 5G is still in its developmental and testing phases. It will also require new hardware, since it needs a lot more cell towers in order to work. Its range is much shorter than 4G, for instance, since it uses much higher frequencies. Therefore, more cell towers closer together are required for good coverage of a 5G network.

In Brazil, the bids for 5G networks were scheduled for the second half of 2020. Because of the COVID-19 pandemic, it has been postponed and may take longer to happen. Thus, while 5G may answer the problems in current IoT networks connectivity options, it will still take some time for it to be ready for business going through Digital Transformations.

Finally, one issue that can affect businesses that mean to acquire or that already have some IoT equipment already in place: communication protocols. These are the protocols used in devices from different manufacturers. In most cases (if not all) — from factory floors to office buildings —, the equipment used is not all from the same manufacturer — most of the time, because there simply are no options available for each specificity of every business.

The variety in protocols that run different pieces of equipment means that data is collected, archived and stored differently in each of the cases. Therefore, the data from different devices can’t be analyzed together and requires processes to make it all compatible. It also makes communication among devices difficult. Since seamless communication that allows equipment to make edge decisions is one of the objectives of IoT, developing a system to integrate communication protocols is also very important when planning for IoT infrastructure.

 

Opportunities

All of the issues presented can and already are being solved. However, they showcase some of the challenges in establishing an IoT infrastructure in a business — be it an office, factory etc. They also show that, for most cases, it is important to consider the business strategy going into Digital Transformation and, therefore, IoT. A plan that considers timing, money and costs is very important.

The great value of IoT is that, although it aims to be a full, integrated and mostly automated system, it can also generate a lot of value even in smaller and more isolated installments. This means that, while building the projected infrastructure, a business can already collect and process data. By applying this information, it can get return of the investment from a very early stage in the Digital Transformation process.

Furthermore, IoT can be used not only by individuals, but by companies (offices, factories etc) and entire sectors, such as utilities, healthcare, industry, agribusiness and payment to mention a few. For instance, if the house monitors its power usage — from temperature control, smart lighting to electronics and even vehicles —, it is possible to generate invaluable data on its electricity needs. This information, added to that of other homes, can help the electricity sector to device new ways to charge and distribute energy.

In agribusiness, as well as manufactory, it is beginning to be used in industrial scale, to automate factory lines and crop equipment — such as tractors and other machinery — and collect data on losses, productivity, speed and maintenance.

In healthcare, equipment can use sensors to maintain rooms (adjusting variables related to air quality, temperature and humidity, for instance). There are also wearable devices that monitor patients, be it in hospitals, clinics and laboratories, be it remotely, at home, recuperating or monitoring chronic conditions. Wearable devices are usually multi-purposed, enabling, health monitoring, exercise, diet and hydration tracking, as well as other uses such as: connection to smartphones and enabling payments and transactions.

Therefore, IoT is a crucial investment in current times, where data is being proven as the way forward. Each of economic fields and each company must do their due diligence and start their IoT (and, therefore, Digital Transformation) process with a clear strategy. However, IoT is, by nature, extremely malleable and flexible, which allows it to be adapted to each and every circumstance.

IoT opens new possibilities to automation and process and strategy. It will allow, given time, better decisions to be made — based on data and its history —, smarter work and, in the future, the adoption of Artificial Intelligence, so this data can be analyzed and decisions made faster, directly on and by the equipment being used. IoT is, thus, the means to take businesses to the future and usher in the changes of Digital Transformation.

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