The Internet of Things, or IoT, is no longer a buzzword. It is an innovative technology with innumerable applications in agriculture, healthcare, manufacturing, transportation, household and industrial security systems, smart homes, smart cities, etc. Smart IoT sensors can be connected to edge computing nodes, most of which will be controlled via the Internet of Things applications.
As the market demand grows ever further, the need for IoT application development services is constantly increasing. This article explains how to develop IoT applications and provides an Internet of Things market potential analysis, the list of benefits of IoT app development, and a roadmap for successfully accomplishing an IoT project.
Market Potential
The number of IoT devices and appliances worldwide is forecast to skyrocket from around 9 Billion in 2020 to more than 25 Billion by 2030. One of the reasons for such rapid growth is the expected adoption of 5G coverage across the glove, be it from government initiatives or through Elon Musk’s Starlink network, which grows by the day.
If the pace of growth does not change, then by 2040, we expect to see nearly 50 Bln interconnected IoT devices with a network spanning the globe and being present in everything from industrial complexes to smartphones and home appliances. This presents immense IoT investment opportunities to bold startups that think strategically.
Let’s take a closer look at the data behind these shiny prospects:
- According to Statista, the worldwide spending on IoT is forecast to reach $1.1 Trln by 2023
- If we believe McKinsey’s Global Institute to be right with their assumptions on the global economic impact of the IoT, then this sum can grow tenfold––to $11 trillion!
- A Gartner survey highlighted that in 2019 99% of companies were conducting or planning some IoT pilots and that these budgets are expected to increase in the next 5 years.
- Another Gartner research study shows that 63 % of enterprises expect financial payback within 3 years after launching their IoT initiatives.
Below is a list of various reasons why companies adopt IoT and the benefits they receive from IoT application development.
Reasons to Invest
1. Better Acquisition Chances for Startups
As of May 2020, there were 2,500+ companies in the EU investing in IoT. According to the Venture Scanner report, the global IoT startup funding rose above $5 Bln last year, which was a 15% YoT growth, and this is just the tip of the iceberg.
Just to put things into perspective, spending on smart cities reached $105 Bln in 2019, and smart home systems are expected to amount to $157 Bln by 2023. Thus, this is a very lucrative business niche for entrepreneurs who want their share of the ever-growing IoT investment opportunities.
Why is this the case? Because an IoT application is often the solution for slow, tedious, or inefficient processes that enterprises in many industries had to endure previously. Thus, many global enterprise companies establish startup incubators and buy out promising startups to incorporate their ideas into the existing workflows. This helps such businesses ensure better performance, lower expenses, and faster turnover, ultimately giving them a solid competitive edge.
By developing products similar to those already bought by some large corporations, you get a much better chance of acquisition and a successful exit.
2. Cost-Efficiency
Where 50 sensors were previously needed, now just five will do thanks to the IoT and edge computing. Where employees had to spend three hours previously, now they will spend 30 minutes. IoT implementation in manufacturing, transportation, and other heavily-automated industries will save companies $1.2 Trillion in terms of employee productivity, which is just the beginning.
3. Revenue Growth
A research study from Tata Consultancy states that the companies who have invested in IoT initiatives are already seeing revenue increases due to such projects. The IoT removes the need to support multiple field-deployed systems with legacy connectors. Instead, a company can have an interconnected system with clear frameworks and simple software updates and/or reconfigurations.
This immensely cuts the initial deployment and setup costs, which are a huge part of any strategic initiative. The funds freed up in this way can be reallocated to sales and marketing, significantly empowering the value offering and resulting in revenue growth.
4. Benefits for Employees
In terms of the IoT and edge computing implementation in the energy, oil and gas, agriculture, manufacturing, and other industries, Internet of Things applications provide multiple benefits for personnel:
- real-time alerting on any issues
- increased incident response speed
- increased work efficiency and reduction of overall incident count
- remote control over hazardous or tedious processes
5. Continuous Feedback Loop
Building an interconnected system reduces the barriers between the manufacturers and the end-users of their products. The businesses can collect and analyze huge volumes of data and form a continuous feedback loop, allowing them to implement customer feedback faster and highlight underperforming workflows, infrastructure components, and approaches. This also contributes to building a brand image and gaining a competitive edge.
6. Real-Time Remote Monitoring
IoT sensors connected to edge computing nodes transmit the data on workplace conditions, equipment, or process performance. Thus, a remote operator can be as efficiently aware of the operational situation, as if they were present on-site. This helps decrease the number of people actually needed to oversee the production.
7. Incident Risk Reduction
Smart sensors can predict upcoming equipment failure based on a variety of factors and issue a timely alert, so a potentially faulty or worn-out component is replaced safely. This leads to a significant decrease in the number of incidents in production. Applying Big Data analytics and Machine Learning models to such data helps determine the exact service time of each part and maximize the efficiency of investments in equipment. Embedding such sensors even in home appliances so they can warn their users of potential crashes has huge market potential.
IoT System Development and Application Steps
IDEA: You must formulate the product idea as precisely as possible.
MARKET VALIDATION: Pitch your idea to the potential target audience, and see if it is actually needed and viable.
PLATFORM SELECTION: Select the technology stack your IoT application will use.
HARDWARE: Select the best fit from the readily available hardware components.
SCALABILITY: Ensure you build the software with scalability in mind. Whether it be on-premise or cloud-based, its architecture should support rapid winding up and down multiple instances.
SPEED: Data processing on-the-fly is a must for IoT applications to be of commercial value.
DEVELOPMENT: Build an in-house team to preserve the company’s expertise or look for outsourced IoT application development services from skilled professionals to cut costs and ensure quality.
PRIVACY AND DATA SECURITY: Design your IoT application with data security as a primary concern to ensure your customer’s details and information are safe.
TESTING: Use various kinds of testing in production and have a pilot run with limited public access to eliminate all bugs before releasing the app to the public.
FEEDBACK LOOP: Provide multiple channels for your customers to leave feedback, process it, and implement the best ideas to improve your IoT application continuously.
Roadmap to App Development
Increasing the cost-efficiency of operations is the main driver of the ever-growing interest in IoT investment. 54% out of 1,600 enterprises currently engaged with IoT initiatives worldwide are concentrating on reducing their operational expenses. This is easily understandable in regards to the COVID-19 pandemic and the global supply chain disruptions it causes.
Thus, the variety and quantity of IoT applications will grow along with the areas where they can be implemented to cut costs, increase revenues or innovate. Most importantly, the mobile IoT application market is far from being stable, so that you can disrupt it quite easily with a well-built and easy-to-use app.
If you are among the IoT startups willing to conquer the market and ride the hype wave in the next decade, all you need to secure investment is to access reliable IoT application development services. This will help you develop a good MVP that will help prove your idea feasible and help secure more investment or sign an acquisition agreement with one of the enterprises.
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