The Internet of Things  Reaches Critical Mass

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The Internet of Things  Reaches Critical Mass

According to the Gartner Group, the number of Internet-connected gadgets in use will reach 8.7 billion by year-end 2017. While consumer Internet of Things solutions comprised 63% of the global market in 2016, IoT-related spending at the enterprise-level is growing rapidly, especially in manufacturing, transportation and utilities.

In 2016, the world’s leading manufacturing companies including General Electric and Bosch invested $178 billion in IoT projects dealing with manufacturing operations, predictive maintenance and asset management. In 2017, IoT-related enterprise technology spending will reach $273 billion. General Electric, for example, uses Cisco’s networking infrastructure to securely store, transmit and analyze equipment performance data collected through the GE Brilliant Manufacturing Suite. The company has recently deployed the so-called “Brilliant solution” at a California factory and increased its productivity by 25%. Analysis by the Motley Fool estimates that a 1% average increase in the worldwide productivity of manufacturing companies would result in $10-to-15 trillion in global GDP growth.

Similarly, IoT spending by transportation companies reached $78 billion in 2016. Where did the money go? $55.9 billion (or 72% of the total) was spent on “smart-freight monitoring solutions.” By enhancing “dumb” objects (including vehicles, refrigerators and even bulk goods) with RFID tags and Zeg- Bee sensors, enterprises are able to collect machinery, personnel and cargo data, identify inefficiencies and subsequently reduce operating expenses. Did it pay off? 70% of logistics companies that have already initiat- ed IoT projects generated a 30% increase in productivity and order processing efficiency. Cisco believes that the impact of the Internet of Things on logistics and supply chain businesses can reach $1.9 trillion by 2025. And,

Utilities spent $69 billion globally on IoT in 2016. This spending was dominated by so- called “Smart Grid solutions” ($57.8 billion). For instance, General Electric’s Digital Pow- er Plant solution enables wind farms and power plants to generate electricity with re- al-time control, and little to no environmental impact. According to GE’s estimates, the system can help the average gas-powered plants reduce operating costs by at least $50 million a year. By switching to smart grids, the USA can save up to $42 billion in energy costs during the first year, as well as reaping other IoT benefits such as the real-time control over energy bills, large-scale off-peak charging of electric vehicles and the growing utilization of renewable energy.

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