What are IoT Devices? A Practical Overview with Market Projections

The Internet of Things (IoT) is a relatively new market, projected to be worth $1.2 Trillion by 2022 according to International Data Corporation. Though the idea’s been around for decades, the IoT market only really started to take shape between 2009 and 2015. Currently, with 7 billion IoT devices globally, we may see over 75 billion IoT devices by 2025. Your smartphone is just one of many IoT devices you probably already own – and they’re already changing the way you live, work, and do business.

Examples of IoT Devices

One way to think about IoT devices is not entirely different from peripheral devices like wireless keyboards, mice, printers, and scanners that connect and are controlled by a desktop or personal computer. A mouse would be rather useless unless it was connected and could interact with a computer. IoT devices can connect to computers, mobile devices like smartphones, or “the Cloud.” More precisely, an IoT device is essentially any digital device that:

1. Is addressable, it either comes with or is assigned a unique identifier like an IP address.
2. Has access to the Internet, typically through a wireless connection.
3. Can share data with other devices and people without human intervention.

The Internet of Things is so big that it is divided into several markets (LINK) or industries. There’s likely an IoT device and app for just about anything you can think of – including beer and diapers. Here are just a few that you may be familiar with:

IoT Device Management

As just noted, all of these devices would be quite useless without a connection to other devices capable of managing them. At the end-user level, IoT apps may be managed by a PC, Mac, Smartphone, Tablet or Home Assistant. Businesses today, however, rely upon Cloud Services offered by Google, Microsoft, and Amazon. Some few may rely upon their own custom architecture, but as we’ve explained that option can be cost-prohibitive, especially for startups. Four very important functions are involved in Basic IoT Device Management:

1. Resource provisioning and authentication – adding authenticated devices to the network.
2. Configuration and control – ability to adjust device settings over time for purposes of performance and security.
3. Monitoring and diagnostics – for clear visualization and proactive detection of bugs and hardware problems.
4. Firmware updates and maintenance – the ability to distribute new app or software versions

IoT-based businesses may manage millions of devices. Sometimes the basic capabilities are insufficient and Contextual IoT Device Management may be required. This expands business capabilities to provide fine tuning on a per-device basis of bandwidth, persistent connections and connection range for the sake of preserving battery life. All of this impacts the cost of IoT operations.

IoT Device Connectivity and Networking

As IoT Devices use wireless connections depending upon range and area of distribution. With Smart Farms, devices may be distributed over hundreds of square miles in relatively remote geographical regions where a LPWAN would be sufficient.

• Ethernet – Frequently used in hardwired buildings and factories and has the best security.
• Wi-Fi is the most common IoT connection but has more security challenges.
• Low Power Wide Area Network (LPWAN) – Used for wide-area applications.
• Cellular – Useful for IoT devices in remote areas, but only available through carriers.
• Satellite – The least accessible option with fewer carriers, best serving desolate areas.
• Bluetooth – Used in conjunction with a gateway or other device already connected to the Internet, has a max range of up to 100 meters but usually reserved for devices in close proximity (1 to 10 meters) to one another.

Again, most businesses and enterprises connect their IoT devices to the Cloud. For one, pay-as-you-go Cloud Services are exponentially more cost-effective than maintaining a server farm of your own, especially for start-ups. Most cloud services rely upon several data centers, providing a layer of disaster readiness and mature data security protection.

IoT Device Security

Security is a huge issue with IoT. Stories like how a hacked coffee maker brought down an entire factory, or how Russia’s hacked Ukraine’s power grid in 2015 are becoming increasingly commonplace. One of the problems with IoT Security is that there’s no single security standard AND no single measure that is 100% effective by itself. In consequence, developers focus on layered protection making use of physical security protocols, passwords, two-factor authentication and encryption, firewalls, intruder detection systems, alongside potentially biometric and blockchain systems. The burden of IoT Security falls upon everyone at the moment, manufacturers, software and app developers, as well as end-users. Manufacturers of IoT devices must be doubly focused on security as it only takes one component in an IoT device to have a security issue to compromise the entire device or network it is tied to.

Anticipated Growth of the IoT Market

It’s difficult to acquire year by year IoT market projections, and not all market research companies agree on exact figures. Still, it’s handy to get a bird’s eye view on the following 10 IoT markets representing nearly $1 Trillion in projected market value through 2025:

• Industrial IoT – $232 billion by 2023, per Zion Market Research.
• IoMT or Medical IoT – $158.1 billion in 2022, per MarketsandMarkets.
• Automotive IoT – $156 billion by 2022, per PwC.
• Smart Homes – $150 billion by 2024, per MarketsandMarkets.
• Smart Retail – $94.5 billion in 2025, per Grandview Research.
• Wearables – $51.5 billion by 2022, per MarketsandMarkets.
• Smart Grids – $60 billion by 2024, per Zion Market Research.
• Smart Supply Chain Management – $19 billion by 2021, per Gartner Research.
• Smart Farms – $18.2 Billion by 2025, per Grandview Research.
• Smart City – $2.4 billion by 2025, per Allied Market Research