As Indian enterprises progress in their Digital Transformation (DX) journey, IoT is considered a key enabler leveraging third Platform technologies. Over three fifths of enterprises in India have already deployed IoT. CXOs are realizing IoT’s business value, with 100 percent awareness and aggressive plans to deploy over the next 24 months. Setting strategies, finding budgets, and supporting IoT solutions have contributed to an ongoing tussle between LoBs and CIOs. However, LOBs are now both leading the discussions and either paying in full; or sharing costs of IoT initiatives with the CIOs.
While this is creating unprecedented opportunities in the market, vendors need to be prepared to tap what is currently a $19 billion market; and is likely to grow to upwards of $34 billion by 2021. Vendors should look at building vertical use cases, considering 90 percent of IoT platform decision-making will happen between the next six to eighteen months.
In terms of market evolution, several new developments are pushing the IoT market, including:
Importance of IoT security: Businesses are realizing the need for an end-to-end security with proliferation of IoT devices. IoT is driving the need for network security connecting multitude of devices, requiring end-point security, along with security analytics.
5G driving the mobile IoT: IDC predicts that by 2021, 75 percent of enterprises with a positive IoT ROI will use tactical analytics applications to reduce operating costs, but the 25 percent that successfully invest strategically in a decision architecture will increase their revenue share.
Edge computing: Digital Transformation along with the volume and the speed, at which the data is being generated, is pushing enterprises towards edge computing. IDC predicts that by 2020, IT spend on edge infrastructure will reach up to 18 percent of the total spend on IoT infrastructure, driven by deployments of converged IT/OT systems that reduce the time to value of data collected from their connected devices.
Blockchain: Leveraging blockchain for IoT reduces costs, improves trust by providing more secured transactions, thereby diminishing settlement time.
While data is driving the digital world, it involves managing data from the core to cloud and analyzing it to make real-time decisions. This requires IoT, mobile devices, big data, machine learning, and cognitive/AI, collectively to deliver meaningful, value-added predictions and actions.
The adoption status of cognitive/AI correlates highly with the information DX maturity of the organizations. More organizations that adopted AI solutions have moved into the later stages of information DX maturity that is managed, and optimized. In order to promote digital transformation that utilizes IoT and cognitive systems, it is important for user companies to cultivate an "agile" mindset; for example, it is necessary to have a concept of determining the ROI while using IoT and cognitive systems in actual situations.
While large and diverse data sets create new challenges. However, when combined with AI technologies and exponential computing power, they create greater and newer opportunities.
The author is Associate Research Manager, Cloud and Datacenter at IDC India
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