Internet of Things
The Internet of Things (IoT) is a new business development approach that not only revolutionalizes logistics, among other business applications and applications. Therefore, IoT refers to the international infrastructure for the information community, promoting valued services by incorporating both physical and virtual appliances based on existing and transforming interoperable database and communication technologies.
Value Drivers of IoT
The IoT application plays a significant value to both the business operations and the consumers. The factorized manual proximity driver encompasses multiple uses, like typical payment algorithms, pet tagging, building enter controls, self check-outs, and libraries stock-taking. The venture gain stems from smart things communication prowess. Through the convenient and fast, unique identification number, they detect physical objects in the process (Huckle et al., 463). The intelligent thing proximity to a hotspot eases transaction by automatically making payment algorithm, checks, and forming entry records. The driver leads to business value by escalating work satisfaction ( the use of the RFID-loaded access hotspot convenience rather than manual entering of personal security codes, promotes customer service (expensive outsourcing activities including check-outs) and reduces labour costs by increasing data accuracy (Saidu et al., 244). The customers have escalated self-service; thus, convenience.
The automatic proximity driver application in the business include asset tracking, libraries robot, and theft prevention stock taking. It makes an electronic transaction, primarily when there exists a distance threshold drop of physical items (Huckle et al., 464). For example, when a customer leaves a premise without paying for the purchased commodity. The venture supply and production management make the use of the IoT from the property to inventory management. At the times when a smart thing, like a forklift, tagged truck, among others, does not get sensed, it triggers transactions, including bookkeeping record update and commencement of replenishment alarm bells (Witkowski et al., 765). Therefore, the IoT applications highlighted leverage the great physical neighbourhood qualities in building new and better business processes. Thus, the automated proximity execution leads to the reduction of labour, process failure, and fraud costs. It also ensures massive data delivery for the process improvement. The automotive and aircraft manufacturing sectors develop systems that integrate informatory with the physical word on various shop floors via augmented reality applications (Saidu et al., 242). They help at giving the workers instructions and assembly policies in fulfilling their activities.
The automatic sensor of the IoT helps at collecting data through sensors. The conventional electronic sensor IoT business applications include olive oil production( sense the required temperature and humidity as per the preprogrammed conditions, networked smoke detectors, perishable item management, compliance assessment, and smart meters. The sensor database involves temperature, chemical composition, vibration, brightness, humidity, among others. They help at sensing the environmental conditions as per the preprogrammed rules. They help in the decision-making process. They increase the process quality process resulting in convenient and efficient input and output relationship of doing things. The precision Agriculture in olive oil production leads to eco-friendly water process control. The thermostat detectors in the homes help at alerting people of the impending hazards. The IoT technology helps at providing natural prior-warning systems for forest fires, monitoring the patient life signals at hospitals, and perishable commodity management (Saidu et al., 242). It helps at personal and prompt process control that escalates process efficiency and creates data granularity for process improvement for a venture value. The customers leap in the quality of service and products.
IoT offers automated product security. The driver applications include anti-counterfeiting, pedigree, proof of origin, and access control, and the smart thing minicomputer embeds a cryptography security technology. A user confrontation with IoT security enables validity checks via challenge-response operations. The ATM cards and the car keys require computing technology for protection (Saidu et al., 243). For the reduced mass-produced products, the smart thing offers an escalated derived security level by integrating its digital proxy, and the homepage update pedigree ensures increased customer confidence. Computers detect counterfeit products without human intervention. The network-based approach ensures security code formation for fake product calculation (Huckle et al., 465). The IoT makes the business to reduce costs in the process due to fraud and to provide security for customer products, thus elevated consumer trust. The consumers have secured PINs for their products.
Direct and straightforward feedback from the IoT ensures human interaction. The IoT smart things produce audio signals (beeping) or visual signals (flashing LED). The exciting consumer-oriented applications give feedback through haptic effects or even smell, among others—the traffic-signals alert the consumer whether a particular commodity has the correct tagging price (Saidu et al., 242). In the Infineon and ST microelectronics production environments, smart assets have low-energy consumption display for destination and machine tools via integration with identification, localization, and connection to the production implementation system, cost-effectively allowing error-free logic chip production. Smartphone linkage provides direct and sufficient information to the clients (Wortmann et al., 221). The venture value processes become faster and flexible, increasing customer convenience and entertainment value. Some of the vital applications include feedback gates, advanced digital games, among others.
Extensive user feedback increases business operations. It leads to consumer product-related services ideas such as on-the-spot price comparisons (discount identification), political shopping advice (labour product), allergy and health warnings (product harm), and product rating review. The presence of the audio and video linkage in cities improves the interpretation of the foreign language. IoT can be used to aid traffic management in urban areas (Saidu et al., 247). The startup Advantech B+B SmartWorx has developed a mesh network that will be able to link traffic cameras, digital signs, traffic signals, and various other sensors. These devices will communicate with each other to detect where traffic is building up or accident occurrence place (Huckle et al., 463). These connected devices will then be able to manage traffic in real-time by altering traffic signals in the city to clear buildups and show any delays on digital signs that drivers may face on their current routes. The system will also be able to provide drivers with live traffic information that will be relayed directly to their navigation systems so they can plan alternate routes accordingly (Wortmann et al., 222). Other benefits of adaptive traffic management are reduced fuel consumption and reduced greenhouse gasses. IoT will also be used to help with municipal parking. The business gain profit through the establishment of new channels of maintaining consumer’s contacts, attention, and services—the consumer’s benefit from gaining personalized services in a fast way at the right place and time.
IoT Economic Players
Technology companies contribute economically to IoT. Not surprisingly, Google, Amazon, and Microsoft pave the way for IoT cloud platforms. These companies have the most substantial financial and technical resources available. Google Cloud is a secure network that can store, process, and analyze big data in real-time. Amazon uses its Amazon Web Services IoT platform, and Microsoft uses its Azure IoT Suite in similar capacities as Google uses Google Cloud (Saidu et al., 242). These cloud platforms can scale the infrastructure, storage capacity, networking operations, and analytics of device-generated data. They also offer the best security to ensure devices non-hacking. IoT relies on the Internet, Wi-Fi and mesh networks, and Cisco leads the way. They have always developed network equipment such as routers and switches and the software and services to support their equipment (Witkowski et al., 765). If a device loses its network connection, then enormous financial and physical risks could occur. Cisco makes sure their hardware does not fail and that their software can take the appropriate actions should they experience device outages.
The market leader in sensor technology is Bosch. They shipped over one billion microelectromechanical systems (MEMS) sensors in 2013, and projection indicates significant growth (Huckle et al., 463). Embedding MEMs into internet-ready devices is essential, and Bosch is the top manufacturer. Without sensors, IoT would not be a new technology. These sensors will have to produce less heat, use less power, have a lower cost, and increased battery life. ARM has penetrated 95% of the smartphone market with its chip architecture (Saidu et al., 242). It specializes in designing low power processors and sensors in mobile devices, and the Things in IoT requires less heat and power usage, a lower cost, and longer battery life. ARM will have to improve its architecture further to enhance these device traits. Other semiconductor and architecture companies such as Intel will play a role in IoT’s future as well. However, Intel processors generally use more power and heat, and they will need to higher lower their power consumption to compete with ARM in the small device market space (Witkowski et al., 765). Whether Intel or ARM take over the IoT future market is undetermined, but semiconductor plants will be in high demand to build low power and cost integrated circuitry.
Economic Benefits of IoT
The most significant benefits of IoT are real-time situational awareness, optimized autonomous processes, and reduced resource consumption. IoT provides enhanced situational awareness by giving the IoT user with real-time information on all aspects of a business process. This current information will assist the users in making better decisions. The IoT system also performs analytics on the data it collects to help assist in the decision making process. IoT will optimize processes for a business (Wortmann et al., 221). An IoT system can automatically perform business functions such as maintaining inventory records for a business. The IoT system will be able to track what products are shipped into and out of a warehouse. It will then be able to automatically update the inventory database once it scans a product entering the facility. The IoT systems will also be capable of automatically taking measurements such as temperature, weight, and humidity to avoid human error and then take a course of action based on the frequencies it receives. IoT systems also reduce resource consumption. IoT devices, such as the Nest Learning Thermostat, are capable of learning human tendencies and make adjustments to heating and cooling systems to reduce energy consumption (Witkowski et al., 766). IoT systems are capable of producing similar energy savings by intelligently turning off lights and reducing water usage.
IoT Positive Impacts on the Economy
In the telecommunication industry, network and online IoT devices ensure information connectivity and delivery; thus, high subscriptions for data services. The traffic volumes and global data have increased over the years. The escalated connected appliances to the internet have resulted in more smartphone usage by people. The advancement of the IP technology in the smartphones and the PCs services, including VoIP, internet streaming, has led to the phone economy growth with over 11.2 exabytes per month (Saidu et al., 242). The increased connectivity to the internet boosts the technology economy due to the traffic volume generation since they charge data sent and received. In the hardware production, the escalation microchip and microprocessor technologies have led to the manufacturing growth due to the reduced size of average microprocessors (Witkowski et al., 765). Therefore, the cost of hardware production reduces due to the declined materials price. The hardware companies use IoT technology to produce appliances utilized by the internet superhighway, thus, high revenue gain.
The information miners extract a plethora of databases from the internet for use by the community. The available technologies, like web services, semantic web, and data mining tools, have reduced sophistication of machine to machine communication resulted from artificial intelligence. It eliminates human data transmission and processing without human involvement leading to development from the analyzed real-time data (Witkowski et al., 764). It impacts logistics, healthcare, and smart environment domains of the societal economy. The IoT application in transportation features high data volume generation, and the installation of the sensors and actuators for real-data sending to traffic systems manages road traffics. The acquired information monitors fuel consumption, break-don cost, road user population in determining pricing based on demand and supply (Wortmann et al., 221). The IoT offers patient and staff monitoring and authentication in the healthcare sector. The real-time data analysis reduces expenditure costs. The companies providing drugs analyze illness sequences in assessing production quantity for expiration wastage prevention. The insurance industries monitor health trends and patterns in determining the effective premium rate (Huckle et al., 465). The increased plethora of sensing and tracking IoT devices enhances convenience. The IoT smart environment brings efficiency. For instance, the autonomous appliances sleep during inactive periods and operate in the busy time, thus economical. It saves energy at a reduced cost.
In the advertisement industry, the marketers form goods and service advert platform channels to the intended consumers. The IoT has challenges at penetrating the closed market. The IoT leads to minimal human intervention, thus making it difficult for marketers to sell their products. The information feedback presence enables advertisers to enter the market. The autonomous devices read and transmit consumer mood data, thus channelling adverts in the regions of need (Witkowski et al., 765). Therefore, IoT monitors consumer events for the sales increment due to the market trend awareness. The data generation sensitivity in IoT ensures security measures in safeguarding personal information appliances from attacks.
IoT Economic Challenges
The biggest impediments to implementing IoT are its costs, security risks, and compatibility with other systems. IoT is a new concept and, therefore, expensive for smaller businesses to implement. A small, independent warehouse may find high switching costs when going from a manual process to an IoT process (Witkowski et al., 766). To fully utilize IoT, the business would need to overhaul its current operation to the newer technology completely. Therefore, companies without a lot of capital to invest will either need to slowly phase in IoT solutions or wait for the costs of the devices to decrease. Another major issue with IoT is the security and privacy risks. Frequently, an IoT device will have underlying networking technology. It means that the IoT device will transmit data that does not have a secure encryption (Saidu et al., 247). It creates a possibility for personal information stealing through these weak controls. Better encryption models need to be implemented by IoT devices to ensure there are no security breaches.
Additionally, unauthorized users may be able to access the IoT device networks and alter the device. For example, Hive, a smart heating app, accidentally sent homes to a temperature of 32 degrees Celsius (approximately 90 degrees Fahrenheit) (Saidu et al., 246). A security breach in IoT devices could cause significant damage to a company by accidentally changing a setting. Finally, most IoT systems are proprietary. It means that they do not work with other IoT devices. Most smart home technologies are not compatible with each other. The thermostat, garage door, oven, and other appliances mostly have their proprietary app (Witkowski et al., 765). It means the devices do not communicate with each other and are not able to be operated from one central hub. A standard signal needs to be developed for accessories to ensure they do not interfere with each other and so they can be managed from one central hub.
Economic Rebound Effect
IoT technologies play a significant role in cost reduction. The data entry method reduces both real and virtual world transaction costs. The high sensibility in the transaction costs in the real world becomes unnoticeable. They only check inventories periodically or during abnormal financial consequences. The introduction of monitoring makes companies detect economic declines. The low presence of sensing costs makes companies check the real-world status both within ( using asset tracking in closed barcode-based applications), and without the supply chain through asset tracking by leveraging GSM technology. Machine sensing leads to the production of trusted data. The data privacy protection enables customers to invest in various companies.
IoT Economic Future
The advancement of MEMS devices and sensors will heavily influence IoT. MEMS refers to simple or complex tools that use miniaturized mechanical and electrical components. Most every IoT device will have multiple MEMS embedded to sense pressure, light, electrical signals, motion, chemicals, noise, and a plethora of other external stimuli (Witkowski et al., 766). MEMS will need to consume less power, be smaller in size, and cost less. Because IoT is forecasted for severe growth in the coming years, the MEMS market is set to grow from 11.44 billion devices in 2014 to 26.14 billion devices in 2022 (Witkowski et al., 765).
Conclusion
IoT technology has led to machine connectivity with the internet through general-purpose technology. IoT enables the massive generation of data for improved production optimization, and the increase of IoT connections growth leads to enormous TFP increment. The IoT has led to the easing of traffic jams through monitoring of road events. The different automatic sensors have enabled the detection of various conditions in the environment, reducing the hazard costs experienced. The consumer has electronic product gadgets that offer the security of their online items. The ATMs have the identification and authentication sensors that lead to convenience as well as reducing fraud in businesses. In logistics, IoT has led to asset tracking, reducing expenditure costs. The healthcare centres monitor drug production as per the supply and demand requirements. The IoT has led smart things that perform activities at a reduced price.
Work cited
Huckle, Steve, et al. “Internet of things, blockchain and shared economy applications.” Procedia computer science 98 (2016): 461-466.
Saidu, Charles I., Adamu S. Usman, and Peter Ogedebe. “Internet of things: impact on the economy.” Journal of Advances in Mathematics and Computer Science (2015): 241-251.
Witkowski, Krzysztof. “Internet of things, big data, industry 4.0–innovative solutions in logistics and supply chain management.” Procedia Engineering 182 (2017): 763-769.
Wortmann, Felix, and Kristina Flüchter. “Internet of things.” Business & Information Systems Engineering 57.3 (2015): 221-224.