An explanation of IoT

Everything is connected to the internet. Well, not everything … but almost.

The internet of things, or IoT, is a system of devices, computers, digital machines, and even people and animals that can transfer data over a network. As long as a thing has a unique identifier or IP address, it's part of this system.

"Things" in this system include cellphones, laptops -- devices that obviously connect to the internet and share data. But IoT also includes a person with a heart monitor implant, a farm animal with a biochip transponder or a car alerting a driver of low tire pressure.

Especially with developments in AI, IoT is having an increased impact on our lives and work. Check out what to expect from IoT in the future by clicking the link above or in the description below. And remember to like and subscribe to Eye on Tech for more videos on all things business tech.

So how does an IoT ecosystem work?

Well, every "thing," or device, has some kind of embedded system that enables it to collect, send, and act on data. So first, an IoT device, like a sensor or antenna, will collect data about its environment. Next, the device will connect to an IoT hub or gateway, which enables the data to be analyzed, like with an app on your phone or a business's ERP system.

IoT supports smarter working with more control. Across industries, IoT enables process automation, analysis and insight, labor reduction, and performance monitoring.

For example, [IoT can do the following]:

• IoT monitoring devices on factory equipment allows facility managers to monitor and manage equipment remotely and can warn about machine downtime.
• Airlines use IoT sensors to produce real-time data and report on the condition of engines.
• In agriculture, smart farming systems can monitor light, temperature, humidity, and soil of crops [as well as] automate irrigation systems.
• Even Disney World benefits from the tech. While wristbands let visitors check in, buy food, and gain entry to rides, the data is also being collected to track visitor movement and determine which park areas are busiest and need attention.

However, there are some challenges to IoT:

• Security and privacy. As the number of connected devices and shared information increases, the attack surface and potential for hackers to steal information increases too.
• Data management. The massive amount of data shared and devices on a network can be difficult for enterprises to collect and manage.
• Mass corruption, as any system bug will likely affect all devices connected to the network.
• And lastly, compatibility issues. There's no international standard of IoT compatibility, meaning devices from different manufacturers can have trouble communicating.

But for now, the pros seem to outweigh the cons. Businesses are increasingly adopting IoT to improve efficiency, customer service and decision-making to ultimately generate more revenue. And market experts predict IoT adoption and spending will grow exponentially over the next few years.

What IoT devices do you use in your business? What about in your home? Share your thoughts in the comments, and remember to like and subscribe too.

Sabrina Polin is a managing editor of video content for the Learning Content team. She plans and develops video content for TechTarget's editorial YouTube channel, Eye on Tech. Previously, Sabrina was a reporter for the Products Content team.