There is a growing recognition by business leaders and analysts that there is more to the Internet of Things (IoT) than just connecting a remote device or sensor to an application to monitor a temperature or alarm. Even with wearable devices, expected to grow to 155m units shipped by 2019, people have been happy to just track how far they have walked or how many calories they have burned. Another over used example is your fridge being connected to the internet to re-stock itself without you having to be involved. This is however still really only one device talking to one application. The business world is now starting to recognise that by combining sensor data with a variety of other data sources from inside or outside an organisation, and that data being shared across multiple applications, it can;
- create significant cost savings
- deliver operational efficiencies
- support new business models that have not previously been possible.
IoT is now seen as an enabler to business transformation rather than just an operational tool.
Don’t get me wrong, connectivity is still a significant component of IoT, both in terms of cost and importance. When you are operating in environments that necessitate the combined use of mobile, satellite and fixed communications, managing those three channels seamlessly, means you can add complexity to that list.
The transformational aspect is one of the key differences between M2M and IoT. As outlined in our IoT for Dummies guide:
- IoT: A world where smart objects are seamlessly integrated as part of a global network; where smart objects, applications and data sources from internal or external environments interact with each other to deliver new services or improved processes. It redefines the way humans and machines interact with each other and with the world around them.
- M2M: A technology that provides connectivity for IoT, joining devices to applications. In general, communication providers such as telecoms companies provide this type of solutions.
So, what are the aspects that help shape the Internet of Things and help organisations create the benefits outlined above?
The three categories on the right: Service Enablement, Business Enablement and the User Interfaces are the main areas that differentiate IoT from M2M. These three ‘layers’ of IoT, enabling data and insights from individual silos to be combined into a single and enhanced view., This allows it to be used across the business, between different departments and throughout a range of applications, rather than being restricted to a single business function.
By utilising the above categories, real value can be generated by IoT. By exploiting the near real‐time data generated from devices and sensors , applying a range of analytics on the data, enhancing it with insights from additional internal and external data sources, those insights become actionable through a range of work flows, reports and user interfaces.
For example, a company may have deployed a M2M or SCADA (Supervisory Control and Data
Acquisition) solution to monitor remote assets for alarms caused by excessive heat or failure. Although this clearly has value, and has been proven over the last 40 years, the transformation scope offered by IoT would enable a change in how an engineer’s work is scheduled, what work they do, what information they have at their disposal and what parts they take with them. So, with this sensor data the business could identify when the asset needs maintenance before it fails and automatically schedule an engineer to visit the site when they are in the vicinity, which would be known via integration with data from the resource management application. Information about historical maintenance of the asset could also be combined with the sensor data to identify the age of and relevant parts of the asset to know when they were last replaced. This could then be fed into the inventory system to make sure the parts are available and loaded onto the engineer’s vehicle at the start of the week to minimise the risk of not being able to resolve the issue on the first visit. Therefore, IoT is enabling the business to transform how they utilises their assets, people and inventory in a way that connecting a sensor to a single application cannot, which is explored further in Bill Shurvinton’s blog Haven’t we been here before?
So, what does this all mean?
By thinking beyond simply connecting a device or sensor, IoT can start to bring together different parts of your organisation to act as one, on one set of data, which may sound simplistic, but at the same time, can be quite transformational.
About this author
Hi Danny, completely agree with what you are saying, other than this differentiates IoT from M2M. It all depends on your definition of M2M. In your definition you assume that M2M precludes the categories to the right. There is nothing that prevents those categories from being incorporated into an M2M solution, in fact this is already happening in Australia in companies such as Perth Transport Authority, BHP Billiton and Rio Tinto as part of their Transport Strategy and Asset Management strategy, and this was before M2M or IoT terminology came into play. In essence there is no difference in M2M/IoT as such, it's all about how you use the data that is collected. If that's going to be the differentiator between the two terms, then so be it, but in my view thats playing with words :-)
Hi David, good to hear from you.
Where M2M stops and IoT starts will always be one of those discussions will vary based upon individual experiences and how they have been implemented - they are very inter-linked, and therefore sometimes difficult to separate them.
The main difference we see in people's thinking depends on their approach to doing this across the business or 'beyond the silos' and that probably wasn't clear in my blog. Much of our experience shows that when people talk about M2M, they tend to think about one application and the data associated with it, whereas those two talk about IoT tend to think about how those applications interact with each other across the business and between the 'things' themselves.
However, until people start to talk about specific projects and the value needed from them, it may be as you say, just playing with words.
It still challenging to get companies to think hard about the distinction between M2M and IoT so these kinds of discussions are helpful in educating the market.
David is right in pointing out that M2M extends all the way along the value chain illustrated above. The IoT distinction arises when the value chain is replicated for multiple applications i.e. you can visualize a depth dimension to the illustration showing multiple, overlapping silo applications. These then form the basis for new service innovation based on inter-operability as illustrated in this article of mine.
McKinsey reckon that 40% of the value of IoT is attributable to inter-operability which is why it is important for businesses to plan well beyond silo (traditional-M2M) applications especially in environments such as the home, inside cars, (smart) cities, transport hubs (e.g. airports) etc. where multiple silo-applications are co-located.