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IDC Trends in 2015: How the Internet of Things Is Progressing

January 28, 2015 by Andreas Schmitz 2

A three-year forecast for trends related to the Internet of Things (IoT) says cloud is the platform of choice for integrating data from machines and IT systems. Also: New security risks will emerge, and wearables will gradually replace smartphones.

Intelligent maintenance is probably the most tangible scenario to illustrate what the Internet of Things is, and what it will be capable of: IT systems constantly evaluate sensor data, providing key information about machine components that may need to be replaced. This reduces machine downtimes immensely. Yet the Internet of Things is predicted to permeate almost every industry. Data can be collected from practically any conceivable source, including traffic, sports, and at home. Soon even consumers won’t be able to avoid the new technology, with some likely to shun their smartphones in favor of wearables within the next few years. The central challenge of the next few years will be to ensure the security of this “new” data, and to derive meaningful conclusions from it.

The most important trends according to IDC:

1. Cloud as the central platform

The core challenge for companies will be data blending. Data is generated in a range of formats, but ultimately intended for holistic analyses. For this reason, 90% of companies are expected to manage the required conversion process using cloud platforms. This will reduce complexity, say IDC analysts.

2. New security risks in IT networks

Within the next two years, nine out of 10 IT networks will be confronted with new security threats. It will therefore be very important to understand the specific standards and protocols of every industry, ensuring the deployment of technology that meets their respective requirements for data security and IT security. “Security officers” will be needed to establish strict rules (IoT policies) for use of the Internet of Things.

3. Increased network proximity

IDC analysts predict that by 2018, the storage, processing, and analysis of data will take place in close vicinity of the networks in question. This means that security experts will need to maintain appropriate system landscapes, known as edge computing environments. These environments are primarily characterized by their ability to rapidly adjust to sudden spikes in network traffic. Ideally, this virtualization approach will in future also include the network as well as dedicated management of devices.

4. Need for additional network capacity

About 50% of all companies will be forced to adapt their IT networks to accommodate immense increases in data traffic. According to IDC’s estimates, one in 10 companies will be unable to deal with the tidal wave of data that is predicted to form over next three years, due to inadequate modernization and adaption of company networks.

5. New business models shape infrastructure

Collaboration with an ecosystem of service providers, and joint development of strategic roadmaps and IoT business models together with partners are only possible if you have a flexible infrastructure. Cloud computing, Bring Your Own Device (BYOD), and new services form an integral part of the modern business environment and are prerequisites for IoT success.

6. All industries will profit

The production, transportation, Smart City, and apps for end users industries currently account for more than 50% of all IoT projects. IDC analysts are convinced that in five years’ time, all industries will be investing, usually starting with pilot projects. One thing is clear: Employees with skills in data analysis, data storage management, or data integration will be more sought after than ever before.

7. Smart cities blazing the trail

In 2018, governments will spend more than a quarter of their total budgets on developing IoT-based solutions. There will be cloud-based IoT solutions, and the public sector will increasingly work together with the private sector. From a technical standpoint, the importance of location services, digital maps, and satellite imaging services will play an important role.

8. Industry-oriented platforms will emerge

Currently, 60% of all IT solutions are proprietary, meaning they are available only to user groups with the corresponding licenses. Developments in the IoT market are predominantly open-source solutions. Standardizing data transfer will be essential to guarantee effective interfacing between machines and IT systems. To achieve this, companies will increasingly be creating work groups in order to better comprehend the required efforts and take appropriate steps to achieve them.

9. Wearables are the smartphones of tomorrow

Within the next five years, wearables such as smart watches and smart glasses will have permeated the market. The challenge facing application developers will be to discover new associations and blend them on mobile devices to create useful services. One main aspect will be the seamless communication between personalized smartphones and wearables.

10. Millennials drive IoT forward

By 2018, millennials will represent 16% of the world’s population. They are a generation characterized by high affinity towards IT and treat it like the most normal thing in the world. It will therefore be necessary to rapidly develop new requirements and satisfy millennials’ thirst for new and constantly-evolving apps. According to IDC, one method of achieving this is agile product management. “Millennial thinking” will further accelerate the development of innovations, IDC says.

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