The world of the Internet of Things is rapidly expanding, creating new opportunities to develop innovative solutions in various industries. According to forecasts, by 2030 the number of connected devices will exceed 29 billion, which is 2 times more than in 2020. At the same time, the size of the IoT market has grown from $464.45 billion in 2023 to $552.87 billion in 2024 at a cumulative annual growth rate (CAGR) 19.0%.
In a nutshell, this surge in growth can be attributed to several factors: the increase in the number of Internet-connected devices, advances in data analytics and machine model training, increased adoption of industrial automation, smart city initiatives, and the transformative impact of technology on healthcare services.
What is the Internet of Things?
IoT (Internet of Things) technology is an idea, the essence of which is that ordinary objects, such as refrigerators, cars, watches and others, can be connected to the Internet, while exchanging information between themselves and the user.
This allows them to work automatically and remotely, making our lives more convenient and efficient.
The term “Internet of Things” (IoT) was introduced in the early 2000s by Procter & Gamble and has since been actively used in the IT industry. It reflects the idea of connecting various physical objects to the Internet, allowing them to interact and exchange data. “Things” in this context means physical objects that usually do not have Internet connectivity, such as household appliances, industrial devices, and vehicles.
Examples of apps of IoT technology include smart homes (with remotely controlled thermostats, lighting, and security cameras), smart cities (where sensors monitor and control various parts of city infrastructure, such as transportation and energy), industrial systems, and medical devices.
How does the Internet of Things work?
The Internet of Things (IoT) works through a combination of physical devices, sensors, communication networks and software that communicate with each other. Let’s look at the algorithm for how the IoT concept works:
- Data collection: Devices collect information about their surroundings using sensors built in, such as temperature, humidity, location and other parameters.
- Data exchange: The collected data is then transmitted over the communication network. This could be a wired or wireless network such as Wi-Fi, Bluetooth, cellular, or even IoT-specific networks such as LoRaWAN.
- Data Analysis: Data is sent to remote servers or processed directly on the device (more on this later). Here, various algorithms and analytical techniques can be used to extract useful information from the data. For example, AI algorithms.
- Data-driven decision making: Based on the data collected and processed, devices can make decisions and act accordingly. For example, control other devices, send notifications to users, or automatically interact with the environment.
What products from the world of Internet of things do we use?
Apple Watch, Fibit, Garmin and other smartwatches and fitness trackers are examples of Internet of Things. Data about your activity, heart rate, sleep duration is read by special sensors on the devices, and then transferred to your smartphones, where they are processed and analyzed so that you can monitor your health.
Smart sockets from TP-link. With this technology, you can turn smart plug-connected devices on and off from anywhere, as long as you’re connected to the Internet, and set a schedule to monitor your energy consumption.
The BMW i3 is an electric car that also integrates various IoT technologies to make driving easier. For example, it integrates the BMW ConnectedDrive function, which gives drivers access to various online services and driving functions via a mobile app: pre-heating or cooling the interior before a trip, searching and planning routes and much more.
Where is IoT technology used?
End-user IoT refers to connected devices used by consumers for personal purposes, such as smart security cameras or smart home devices.
Smart Finance is the practice of applying IoT solutions in financial sectors such as insurance telematics/usage-based insurance, real estate, ATMs.
Smart Medicine are apps used for patient care and remote monitoring.
The Industrial Internet of Things, or IIoT, is all about factory and agricultural automation, supply chain optimization, and predictive maintenance.
The application of IoT technologies in the auto industry offers V2X connections, advanced driver assistance systems (ADAS) and telematics solutions.
Key players in the global IoT market are Cisco (Cisco IoT platforms and software), Qualcomm, Dell EMC and IBM.
Trends in the global IoT market in 2024
The concept of the Internet of Things, developed by British technologist Kevin Ashton in 1999, foreshadowed a future where a network would collect and analyze data, allowing devices to perform tasks autonomously. At that time, this idea seemed more like science fiction, but today the Internet of Things has become a reality that is actively developing. Thanks to the development of communication technologies such as 5G and the application of data analytics using AI and ML, IoT has found wide applications ranging from smart watches to urban infrastructure management.
Using AI and machine learning to automate analytics of data collected by smart devices
The Internet of Things generates huge volumes of data, for the analysis of which artificial intelligence tools are being actively implemented. Integrating AI into IoT deployments enables the creation of intelligent systems that extract meaningful information, automate tasks, and streamline operations. Read more about the use of machine learning in our article.
Using AI in Edge Computing Concept
The essence of the concept of edge AI is to place AI capabilities directly on the devices that generate data. The concept has gained interest and will continue to evolve in 2024 because it helps address the data waste and latency associated with using the cloud in IoT.
This local way of processing data provides several benefits: faster response times for apps for instance AR/VR games, improved data privacy and security, lower data transmission costs, and even sustainability benefits due to lower computing requirements. While many edge devices face power constraints, the compelling benefits of edge AI are driving its rapid adoption in the most mature industries.
Implementation of blockchain technology to improve privacy and security
As more and more data is collected and transferred from one device to another and stored in the cloud, the issue of data protection and user privacy has come to the forefront.
Vulnerabilities are hampering the expanding Internet of Things due to weak data encryption and limited computing power of devices. Hackers exploit these vulnerabilities by attacking routers and webcams.
Additionally, as the number of connected devices grows, the disadvantages of centralized servers become more apparent. Blockchain technology, known for its secure record-keeping in cryptocurrencies, is already being used as a potential alternative. A distributed ledger protects data from unauthorized access and eliminates single points of failure, solving security and scalability issues.
Development of 5G networks
The Ericsson Mobility Report shows the growth of cellular IoT with the number of connections reaching 3 billion in 2023, and a CAGR of 12% until 2029. In addition, 5G Advanced opens up new application possibilities with enhanced capabilities and high data speeds. Consequently, communications service providers (CSPs) will prioritize investments in 5G Advanced and NR-RedCap infrastructure, thereby expanding the reach and capabilities of their IoT networks.
Smart cities and the concept of sustainable development
As cities around the world strive to achieve the UN Sustainable Development Goals (SDGs), the adoption and implementation of Internet of Things technology is becoming a critical development focus for many countries around the world.
Networks of sensors placed throughout the city collect data on various city parameters, allowing progress to be tracked on key sustainability performance indicators: energy efficiency, pollution reduction and traffic optimization. As the amount of sensors and data generated in urban environments increases, artificial intelligence and machine learning play a crucial role in automating processes and adding value to this data.
For example, AIoT solutions can predict possible congestion areas to optimize city infrastructure and reduce emissions in the future. Like predictive maintenance in manufacturing, AI can enable more accurate predictions of potential downtime/outages in city services (such as waste management and water supply) or risks such as natural disasters.
The adoption of wearable devices and voice assistants is growing
Social trends cannot be ignored – over the past 5 years, the consumption of smart devices to monitor health, exercise, or simply track one’s activity has increased significantly. That’s why one of the main areas of IoT development is medicine (we’ll talk about the second below).
Another developed area of consumption of IoT devices is the entertainment industry. Smart speakers with a built-in voice assistant or, for example, Apple Vision augmented reality glasses.
IIoT expansion
The Industrial Internet of Things (IIoT) refers to the use of the Internet to control and optimize processes in factories, warehouses and transportation systems.
The global Industrial IoT market was valued at $80.8 billion in 2024 and is expected to reach $176.2 billion by 2033 at a CAGR of 7.5%.
One of the key drivers for the growth of the Industrial Internet of Things (IIoT) is the growing focus on Industry 4.0, which aims to create intelligent factories with a high degree of automation.
Industry 4.0 is, in other words, a stage of human development corresponding to the fourth industrial revolution. The meaning of Industry 4.0 is the mass introduction of information technologies into production, especially AI and machine learning for process automation.
IIoT technologies can help realize this vision by providing real-time data on machine performance, allowing manufacturers to optimize their production processes and reduce downtime.
The fastest growing and most innovative IoT industry is automobiles
The integration of IoT in the automotive industry has opened up new opportunities for both manufacturers and consumers around the world. This technology has become the basis for feature-rich automotive apps, offering enhanced connectivity, control and seamless data delivery.
Electric cars are now associated not only with an alternative refueling option, but also with a fully thought-out and optimized technological content of the car itself.
Leading companies such as Mercedes-Benz, Volkswagen, Volvo, Toyota and Google Inc are investing heavily in developing smart cars equipped with features that promise an enhanced driving experience. According to UBS, by 2030, 12% of total vehicle sales will come from autonomous taxi fleets, with approximately 26 million driverless taxis operating worldwide.