What Is the Internet of Things?

The purpose of the Internet of Things is to track and manage data from devices and equipment — but the IoT moniker stands for far more than just gadgets.

Defining the Internet of Things (IoT) can be simplified down to the connection of everyday things — like homes, industrial equipment, watches, etc. — to the internet, for the purpose of collecting data, tracking usage, and automating systems. While it encompasses many technological devices, it’s important to remember that the Internet of Things spans across all major sectors. The amount of connected IoT objects will reach 50 billion by 2020 and will be worth $7.1 trillion by that same year.

Now that you know a little more about what the IoT is, let’s take a look at how companies are using the IoT right now, and a few IoT examples you might not know about.

Here’s what you might not know.

While much of the IoT may seem like it’s focused on consumer devices, most of the growth with come from the enterprise market. Research from BI Intelligence shows that enterprise devices will account for 40% of all 23.3 billion IoT devices by 2019.

Agricultural-equipment maker Deere & Company uses internet-connected field equipment, along with sensors, analytics software, and cloud services to track the efficiency of seed planting. This type of agricultural technology is transforming how food is grown and how farmers manage their fields and equipment.

Many other non-tech companies are also jumping into the IoT as well. General Electric, the 125-year-old conglomerate, has developed its own analytics software for industrial equipment. GE uses its software to help its customers manage their equipment more efficiently and anticipate when it needs to be fixed. Scottish and Southern Energy uses GE’s Reliability Management software to track its equipment and maintain uptime, which saves the company an estimated $3.6 million dollars every year.

What the Internet of Things needs to grow.

In order for more devices, equipment, and services to be added to the IoT, new and more sophisticated wireless networks are being developed. Verizon is at the forefront of this change and said last year that its upcoming 5G network will help address the IoT’s network needs. Verizon will roll out pilot tests of its 5G network in 11 cities across the U.S. in the first half of this year.

While there’s often a lot of hype around new technologies, it’s clear that companies are already taking the IoT seriously and finding ways to use connected devices and software to offer better products and services. And if this year is any indicator, it appears that now is one of the best times for investors to consider getting on board with this technological shift.

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