IoT News | 6 IoT adoption trends for 2022

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IoT Analytics, a leading provider of market insights and competitive intelligence for the Internet of Things (IoT) and Industry 4.0, recently released an IoT Use Case Adoption Report 2021 that reveals where 200 executives from companies adopting IoT technologies in 48 different use cases are investing their money.

Key insights:

  • According to the IoT Use Case Adoption Report 2021, IoT adoption is set to accelerate in 2022, driven by intelligent operations use cases with a high return on investment (ROI) and IoT projects in Asia Pacific (APAC), especially in China.
  • The gap between IoT adoption leaders and IoT adoption laggards is widening, not closing.

Key quotes:

  • Philipp Wegner, Senior Analyst at IoT Analytics, says:
    “IoT adoption is accelerating in 2022 and beyond! APAC and especially China lead with strong growth rates. Companies are increasingly focused on new business models and are jumping from labor-intensive manufacturing to high-end manufacturing. “
  • Knud Lasse Lueth, CEO of IoT Analytics, adds:

    “Major IoT users plan to invest more in the next two years than their peers. Laggards in IoT adoption need to make sure they don’t fall behind. As early innovators double their IoT investments, the contestants may be late to the party, as our research shows. “

Trend 1: IoT adoption is accelerating.

According to the report, 79% of organizations plan to invest large sums of money in at least one IoT project in the next two years.

In fact, the large average company plans to invest in nine different IoT use cases over the next two years. IoT for asset / plant performance optimization is the use case in which most companies plan to invest, with 42% of respondents planning to invest heavily. Unsurprisingly, there is a solid correlation between willingness to invest (further) and overall ROI. Among companies that have implemented IoT tools to optimize asset / plant performance (i.e. tools that allow users to operate and maintain assets with greater overall equipment effectiveness), 97% have already indicated a positive ROI.

But use cases that are less prevalent today are also expected to see strong increases. More than a fifth of companies, for example, plan to invest heavily in augmented reality in operations (augmented operations).

The picture is obvious: all the signs point to greater adoption of IoT technology in the coming years.

IoT Adoption Trends – Takeaways for 2022: IoT Topics Will Continue to Show Strong Double-Digit Growth in a Large Number of End Markets, Use Cases, and Enabling Technologies.

Trend 2: Use cases that focus on improving operations and assets are on the rise.

While IoT adoption is strong across the board, resource- and operations-centric use cases appear to be the most in demand (compared to use cases for a company’s supply chain or connected products). smart sold to customers).

In addition to the use case labeled IoT for asset / plant performance, the IoT-based process automation use case (i.e., using real-time data from connected assets to improve an entire operational process) and the use of predictive maintenance (i.e., increased use of resources by anticipating unplanned downtime of resources) will likely see heavy investment over the next two years.

A central theme fueling these asset-centric use cases is retrofitting. Companies have been connecting infrastructure and resources that have existed for years and running software-based optimization.

IoT Adoption Trends – Takeaways for 2022: Companies are Focusing on Software-Driven Modernization of Older Assets.

Trend 3: IoT initiatives are becoming more successful.

In 2017, Cisco reported that 60% of all IoT projects are failing, with only 26% of companies reporting an IoT project that was a complete success. Organizations still cite the 2017 study in 2021, although the reality on the ground has changed.

Of the approximately 1,600 IoT projects in our analysis, 79% returned positive ROI. The main use cases resulted in a positive ROI for 98% of companies.

Despite the complexity of many IoT projects (see Trend 6), a number of inhibitors to widespread IoT adoption have been reduced, particularly costs. Prices for hardware have fallen (for example, the average cost for sensors dropped from about $ 1.40 in 2004 to less than $ 0.50 in 2020). Software has also gotten cheaper. Thanks to IoT platforms and cloud services, companies can now procure many necessary software elements in a modular way and through pay-per-use, which allows them to increase costs with use.

The IoT talent shortage is expected to remain an ongoing challenge for years to come. But as many integrators have created specific IoT business units (our recent analysis found more than 700 active IoT integrators), a solution to this challenge is now available.

Trends in IoT Adoption – Takeaway for 2022: The question users are asking has gone from “Will the IoT provide a positive ROI?” to “Which IoT solution or use case will provide the highest ROI?”

Trend 4: The gap between adoption leaders and laggards is widening.

You might think that companies that haven’t started their IoT journey will now wake up and bridge the gap with those that have already adopted.

Our data shows the opposite. Companies that have invested heavily in the IoT in recent years are increasing their investments even more than the laggards in adoption. The gap between the leaders and the laggards is therefore widening and not closing.

The top 25% of companies with the highest share of IoT use cases implemented to date plan higher future investments for IoT use cases compared to the bottom 25% of companies.

The automotive industry provides a fitting example of this trend. In 2012, Tesla became the first automotive company to introduce over-the-air (OTA) updates for its Model S. (Note: OTA is one of 13 IoT use cases classified under the connected products label intelligent)

In the nearly 10 years that have passed since then, the company has invested heavily so that today the entire fleet receives consistent and reliable OTA updates. These updates include major feature updates that increase the value for the end user (e.g. environment monitoring, dynamic brake lights and an onboard music studio).

While Tesla has doubled down on this IoT use case, many competing auto makers haven’t even started this journey. It is reported that, in 2021, major players, such as the FCA group (which includes brands such as Chrysler, Dodge and Fiat), will only provide firmware updates for infotainment systems and no major remote major software updates.

Tesla’s commitment to OTA and other IoT use cases could pay off: OTA enables new monetization methods, and Capgemini predicts that the share of automakers’ revenue that comes from software will increase significantly in the next decade.

IoT Adoption Trends – Takeaways for 2022: Look for other IoT success stories from companies you may have heard of before, not the ones that have been silent in recent years.

Trend 5: APAC is reaching North America and Europe.

In recent years, IoT adoption has been greater in North America and Europe than APAC. But the picture is changing and the APAC countries (and not just China) are catching up.

In our latest research, the large mid-sized company in Europe or North America indicated plans to invest heavily in seven different IoT use cases over the next two years, while the APAC companies plan to invest in 13 different IoT use cases. Companies in China, India, Korea or Vietnam are increasingly focused on digitizing their business models and moving from labor-intensive manufacturing to high-end manufacturing. China tops the table, thanks in part to strong government support. But countries like India, Korea and Vietnam are trying to catch up.

“We will strengthen the drive for innovation, continue to improve industrial ecology, accelerate the construction of new infrastructure for the IoT and deepen application services in key areas.” – Wang Zhijun, Deputy Minister, Ministry of Industry and Information Technologies, China, 23 October 2021

Trends for IoT Adoption – 2022 Takeaway: Look for High IoT Growth in China, Korea, India and Other Asian Markets.

Trend 6: The complexity of IoT projects remains a major challenge.

IoT projects can be complex, and this complexity remains a major challenge for IoT adoption.

In recent years, vendors have put a lot of effort into simplifying the IoT. This includes the development of ready-to-use solution templates, zero-touch provisioning device connection tools, and pay-per-use payment models for software and hardware. Vendors have also introduced modular software components that can be used as needed and include connectors for other popular applications.

However, end users in our research still point to complexity as the biggest pain point. Therefore, it is not surprising that the most common advice for getting started with IoT is to perform proper testing and ensure proof of concept before deploying the solution to your organization or customers. These indicate the complexity of IoT use cases: you don’t know what you don’t know.

Trends in IoT Adoption – Takeaway for 2022: “IoT made easy” does not yet exist: adequate planning and preparation remain key, even if some marketing slogans suggest otherwise

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