Future of IoT offers mixed bag of opportunity, shortages
Here are four trends to consider as the technology melds into the metaverse and Web 3.0, while also battling lingering chip shortages and security concerns.
IoT barely counts as an emerging technology these days, given that it's more than a decade old.
But the technology continues to evolve. Adjacent, arguably more emergent technologies influence the future of IoT. Prominent examples include 5G and the nascent metaverse. IoT will move into new use cases, applications and adoption scenarios as it converges with other streams of innovation.
The long-term trends are, indeed, promising. The technology's near-term prospects, however, are caught up with electronics component shortages, which put a damper on growth projections. Flexibility will be the watchword for IoT technology vendors, systems integrators and customers dealing with a changeable market.
Here are four trends to monitor in IoT.
1. IoT meets the metaverse
IoT promises to play a pivotal role in the metaverse, linking the physical world to the virtual variety. Digital twins -- i.e., virtual representations of physical devices -- rely on IoT data and could prove particularly relevant. A variety of IoT-driven digital twins seem likely to populate the metaverse.
Paul Daugherty, group chief executive for technology and CTO at Accenture, cited IoT, along with developments such as synthetic data and quantum computing, as technologies that will influence the metaverse -- and reshape business in the process.
"The real world, itself, is becoming programmable," Daugherty said, speaking at Accenture's annual Technology Vision event. "This is about IoT. This is about operational technology. This is about digital twins."
In the bigger picture, IoT and other technologies are evolving into Web 3.0, according to Daugherty. The original World Wide Web was an internet of data and search, he contended. In 2000, the web transitioned into social networks and the internet of people. The following shift -- the mobile internet and Web 2.0 -- encompassed 3G, 4G and IoT, he noted.
Now, Daugherty said, the industry is moving to Web 3.0 and two fundamental capabilities: the internet of place and the internet of ownership. The former provides interoperable online venues for shared, collaborative experiences, while the latter uses blockchain and distributed ledgers to create secure digital identities, he added.
IoT is poised to serve as a building block within that ongoing development.
2. High growth for cellular IoT
Cellular IoT technology, which harnesses mobile networks for device connectivity, will travel a high-growth track over the next few years. Market research firm Juniper Research pegged the global market as nearly doubling in four years, expanding from $31 billion in 2022 to $61 billion in 2026.
As the number of IoT connections grows, we do expect the value of 5G to increase and adoption to rise.
Sam BarkerHead of analytics and forecasting, Juniper Research
Juniper Research identified cellular low-power wide-area (LPWA) offerings and 5G as the key technologies driving this growth. The LPWA category, including narrowband IoT and LTE for Machines, will experience the fastest growth during the forecast period. The market researcher said it expects the low cost of connectivity and hardware to boost the technology's adoption for remote monitoring in verticals such as agriculture, smart cities and manufacturing.
5G trails LPWA when it comes to growth, but its day is coming.
"5G is still not as cost-effective as technologies such as 4G, so 5G will be adopted on a case-by-case basis," said Sam Barker, head of analytics and forecasting at Juniper Research. "As the number of IoT connections grows, we do expect the value of 5G to increase and adoption to rise. Next year [2023] will experience growth. However, we expect this growth rate to accelerate over the next few years."
3. Chip shortages continue to complicate IoT
The technology's prospects aren't entirely rose-colored -- the expanding metaverse and cellular IoT applications notwithstanding.
Forrester Research predicted that the continuing chip shortage will impede IoT market growth by 10% to 15% in 2022. While high-end chip sets from Intel and Nvidia remain available, those that power IoT devices aren't always on offer. The lack of supply affects IoT-enabled connected devices, from appliances to industrial products.
IoT-based smart devices often use lower-end chip set configurations -- 4-bit or 8-bit microcontrollers, for example -- that are less expensive and have lower processing demands, noted Glenn O'Donnell, vice president and research director at Forrester.
"Demand for these lower-end chip sets to power IoT-enabled smart devices will continue to outpace supply through 2022," O'Donnell noted.
Market research company IoT Analytics pointed to IoT growth headwinds, including chip shortages, which the company said are expected to persist into 2024 and potentially beyond. That said, the company still forecasted the global enterprise IoT market to expand at a compound annual growth rate of 22% through 2027. IoT Analytics expects the market to reach $525 billion that year.
4. IoT botnet to hit infrastructure
Security persists as a long-time concern with IoT, given the ample attack surface that myriad connected sensors and devices provide.
Further threats are in store. Forrester predicted that, in 2022, an IoT botnet will take down some critical communications infrastructure successfully through a DDoS attack. That attack will surpass 30 million requests per second, Forrester said, cutting off availability and inflicting economic pain.
"Even if we leave [out] the cyber components of the current Russia-Ukraine conflict -- where DDoS is definitely at play -- the likelihood of an IoT botnet hitting the private sector elsewhere in the world is still very high," said Merritt Maxim, vice president and research director at Forrester.
