The IoT story

From the first “thing” in the 1980s to 27 billion devices today – the rapid rise of a technology that’s changing the world.

Without the Internet of Things, there would be no Industry 4.0, no 5G, very few  industrial AI applications and less work for cybersecurity experts to do. Here’s an overview of a technology that we can no longer do without.

The first “thing” on the Internet was created in 1982: a soda machine at Carnegie Mellon University in Pittsburgh, Pennsylvania, that reported on the number and the temperature of the drinks it  contained. It was unique back then, but by some point in 2008 or 2009, the number of things connected to the Internet came to exceed the world’s human population for the first time in history. Since then, the “Internet of Things” (IoT) has experienced a rapid expansion. Some 27 billion devices are now connected to the data network worldwide, including sensors, household appliances, machines, wind turbines, medical devices, and cars – with dramatic increases expected. According to predictions, the number of “things” will exceed 30 billion in 2020 and 75 billion in 2025. At that point, there will be almost ten things connected to the Internet for each human on earth. The IoT market will also explode, from an estimated $248 billion in 2020 to roughly $1.6 trillion in 2025.

Data is valuable

There’s a good reason why more and more devices are being connected to the Internet: Data is valuable. On the one hand, devices can supply helpful data on their current state or on processes in their environment. On the other hand, they can also receive information from the network, making it possible to control them in real time. For example, wind power plants supply large amounts of sensor data that provide information about current wind conditions and the status of the turbines. When this information is bundled in the cloud, it produces a comprehensive picture of the entire plant. Operators can then use algorithms to optimize the plants’ yield and identify problems before a failure can occur (predictive maintenance). This is how the Internet of Things is boosting the competitiveness of the companies that use it. Siemens offering in this area is MindSphere an open, cloud-based IoT operating system.


The future of manufacturing

The IoT also plays a key role in the future of manufacturing. Industrie 4.0 is creating a new paradigm for production halls. Through the networking of all parts of the supply and production chains, production can be universally optimized and instantly and automatically adapted to new requirements – up to and including the production of customized products (batch size one) at competitive prices. The real-time data required is provided by sensors – on vendor parts, on machines, or in quality control systems – that are all connected to the Internet and whose measured values are centrally analyzed.

IoT and AI

The tremendous quantities of data supplied by the IoT often conceal valuable information that can’t be found using simple analytical techniques like statistics. Artificial Intelligence (AI), on the other hand, is generally very successful at accomplishing this kind of task. For example, it can independently recognize patterns in measured values from production and use the information to continuously improve the manufacturing process – making artificial intelligence one of the main reasons that the IoT is booming. At the same time, the Internet of Things is driving the continuous development of AI. Training neural networks requires huge volumes of data that in many cases weren’t available until recently. The IoT has changed all that, because the connected “things” have been supplying more and more data that’s used to develop, improve, and train AI algorithms.

5G as the driver 

The Internet of Things is expected to receive a tremendous boost from the next-generation mobile network. One benefit of 5G is that sensors can be connected to the Internet inexpensively, without consuming a lot of energy and with short response times – which makes it extremely valuable for industry and self-driving cars, for example. Until now, devices have usually been connected by cables or established radio standards like WiFi, Bluetooth, or ZigBee.

“Ignoring cyber risks could destroy business”

The greatest risks posed by the Internet of Things are spies and cyberattacks, because every networked sensor and every refrigerator connected to the Internet can theoretically be misused as a gateway into a network. Highly sensitive data could then be deleted or modified, with devastating consequences. Siemens sees this as a tremendous concern in its interactions with customers every day. Natalia Oropeza, Chief Cybersecurity Officer at Siemens, summarizes the economic risk: “Ignoring cyber risks could destroy business.” Siemens has developed a comprehensive cybersecurity approach for optimally managing this ongoing threat

Christian Buck - Jan 2020

Subscribe to our Newsletter

Stay up to date at all times: everything you need to know about electrification, automation, and digitalization.