Four industries being redefined by IoT data
The Internet of Things is here to stay and is expected to grow drastically within the next few years. Worldwide IoT spending is expected to reach $1.29 trillion by 2020 as industries continue to grow their hardware, software and services to enable more connectivity, according to a recent report by IDC.
Last year, global spending on IoT was estimated to be at $737 billion and the industries that made the largest investments included manufacturing, transportation, and utilities. The industries that are spending on IoT at the fastest growth rate include insurance, consumer, healthcare, and retail.
Where will all of that spending go? Here are four industries that are likely to expand their IoT investments in the coming year and their potential uses for it.
Transportation IoT investments are expanding rapidly to improve efficiency within the industry. The nation is expected to face major transportation challenges in the future, as highlighted in the U.S. DOT’s Beyond Traffic 2045 report, and IoT innovations will hopefully solve these problems in time.
The largest IoT spend in the industry is expected to involve freight monitoring technologies. Approximately $55.9 billion was spent on it last year, and for good reason. By 2045, freight volume is expected to increase by 40 percent so there is a need for safer, faster and higher volume transportation of goods.
One study found that trucks that travel in platoons will be able to save up to 20 percent of fuel by traveling in packs close together to reduce drag. That said, it can be difficult for truck drivers to drive close together safely, so other investments will likely focus on autonomous technology to help enable such truck platoons.
Additionally, there will be freight monitoring investments that include advanced tracking technology to monitor the transit of goods and ensure that they are successfully delivered. Such metrics will allow for greater analysis that can ideally decrease the time it takes for cargo to travel from point A to point B.
There may also be more remote weigh-in technology so that trucks have quicker wait times at weighing stations or eventually, do not have to stop there at all. Other freight monitoring investments may include driver safety technology such as safe-driving apps or truck sensors that send speeding alerts.
IoT investments in transportation may also include in-vehicle safety technology and vehicle-to-vehicle (V2V) technology. Cars are growing increasingly connected on the roads to avoid accidents. Sensors on one car can communicate to sensors on another to avoid crashes and travel safer. There will also be investments in self-driving car technology for consumer travel, as well as new transportation modes such as Hyperloop and flying cars or buses. The transportation industry is growing rapidly in new directions, and 2017 will be an important year for its IoT growth.
In the insurance industry, IoT spending is predominantly going to involve telematics, as they have huge potential to improve accuracy in risk pricing and increase consumer satisfaction.
Whether it’s for home, life or auto insurance, insurers typically price premiums based on data generalizations. For example, with car insurance, providers price premiums based on a driver’s location, age, driving history, and sometimes even gender, depending on the state’s laws.
Telematics allow insurers to move away from generalizations and create customized policies based on accurate driver behavior. If a driver speeds a lot, insurers know and can price for that risk.
On the consumer side, drivers receive more control with personalized car insurance that is based on how they drive and they see insights into their driving behaviors – safe drivers may even receive lower premium costs. While several providers have been using telematics in the past years, they are now looking to advance them. As a result, insurers may look to partner with technology companies or safe-driving apps to measure drivers' skills this year.
In home or life insurance, IoT sensors will also provide more accurate risk pricing. Home sensors can monitor home habits, similar to how Nest acts as an alarm system controller and a remote thermostat. A homeowner that remotely turns their heat on to avoid frozen pipes in the winter may see a lower premium because their behavior indicates they take care of their home.
Likewise, with life insurance, personal sensors could help measure health, similar to how a Fitbit works. Adults that exercise or show healthy habits could see savings on their premium. Investments in all types of personal sensors are expected to greatly expand in 2017 to increase the accuracy of risk pricing and improve the insured's behavior.
This year, the healthcare industry will have among the fastest IoT spending growth – most of which will be spent on remote health monitoring. Health monitors that are worn by patients with chronic conditions at home or out of conventional clinical care could greatly improve the industry.
This innovative style of care will increase patients access to healthcare and decrease costs. Doctors will be able to spot problems early and address any concerns without waiting for a patient to visit a clinic. Furthermore, 70% of routine doctor’s visits do not require face-to-face interaction so telemedicine could be used more frequently to improve consumer satisfaction.
Other investments may include IoT technology within conventional clinics or hospitals. Currently, patients often have to repeat themselves, especially in emergency room settings where they may be seeing multiple doctors or nurses. IoT technology could record patient testimonials and their symptoms to quicken response times and lead to more effective care.
Furthermore, IoT technology that uploads patients’ information to a cloud with their latest information can help improve communication and give patients access to their health files when they need them. The cloud can also host patient empowerment tools or educational materials. IoT can make a real difference in the healthcare industry, and we’ll likely see remote health monitoring expand in 2017.
Consumer IoT is another fast-growing market. In recent years, much of consumer IoT has been focused on wearable sensors as the Quantified Self movement has grown increasingly popular with consumers tracking their fitness, calories consumed, and even their mental or physical moods with products like Fitbit or the Apple Watch.
This year, investments will likely be on new IoT devices. For example, smart home devices are expected to grow significantly over the next five years, so you may see a lot more of connected appliances this year. The goal, of course, is connectivity without complexity so these appliances and smart home devices will focus on making life at home easier.
Another main investment area in consumer IoT will be in entertainment devices. These could include devices similar to Amazon’s Echo or virtual reality devices. IoT devices that help consumers learn more about themselves are also likely to be successful.
The Internet of Things will continue to grow and expand in the next several months, changing our daily lives and pulling us in new directions. Transportation, insurance, healthcare and consumer IoT will see some of the largest investment growth as new technology and products are developed that are designed to improve our current way of life.
The future is exciting, and it appears that 2017 will not disappoint.