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Where Do We Stand with the IoT?

Jan. 20, 2016
Industry leaders discuss issues surrounding the current state and growth of the Internet of Things (IoT).
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A group of industry leaders talked with Machine Design about some of the issues and questions surrounding the Internet of Things. The panel of experts included:

Luca Difalco, vice president of Smart Power and IoT Marketing and Application, at one of the world’s largest semiconductor companies, STMicroelectronics, Huntsville, Ala.

Dieter Michalkowski, international industry sector and global account manager, Aventics, a global manufacturer of pneumatic components and systems based in Latzen, Germany.

Steve Spatig, general manager, Electronic Access Solutions business unit, Southco, a global leader in Engineered Access Hardware based in Concordville, Pa.

Allen Tubbs, product manager, Electric Drives and Controls, Bosch-Rexroth Corp., one of the leading specialists in drive and control technologies, with U.S. offices in Charlotte, N.C.

Brett Wilkerson, RFID Business Development, at MSM Solutions, a leader in RFID and barcode technology, based in Memphis, Tenn.

Here’s what they had to say:

What are the most important benefits IoT offers business, individuals, and society? Will the middle and lower classes be shut out of the IoT due to the high cost of it? Should tax dollars finance it?

Luca Difalco: The IoT offers a wealth of benefits to all tiers on the social spectrum. Businesses and society will realize substantial improvements in efficiency and productivity while individuals will benefit from greater productivity and convenience. Costs should be appropriately allocated based on who receives the benefits, which means some IoT costs should be borne by society.

Brett Wilkerson: Tax dollars should not finance this as the private sector has proven that if there are benefits to be gained from new technology, those in the private sector will invest and grow the technology to reap those benefits.

Steve Spatig: With the IoT, costs associated with the wiring and maintaining traditional analog-based systems are reduced, letting anyone with a wireless, smart device connect. Therefore, IoT offers infinite possibilities for connectivity, making it widely accessible to the general population.

Dieter Michalkowski: IoT strongly supports factors needed for the megatrends of safety, energy efficiency, and customized products (made in lot sizes of 1). In production, the focus is on lowering the total cost of ownership by reducing downtimes and increasing production flexibility. The IoT is driven by the benefits it can create, a much more effective driver than tax financing.

Are there any insurmountable challenges to establishing the IoT? Lack of standards? Security? Overcrowded RF spectrum?

Wilkerson: We don’t believe the challenges are insurmountable, but as more devices and “things” are added to the global network, there will have to be improvements to infrastructure at all levels. The security aspect is an ongoing concern and is ever-evolving. The standards aspect may best be guided by those within certain industry segments that are looking to invest heavily in IoT.

Difalco: The Internet is already well established and there are lots of things connected to it. The issues you raise are all important, but none of them are deal breakers. In fact, ST is working hard on many fronts with many other industry leaders to create additional useful standards and better security. These efforts will expand the IoT and make people, businesses, and society more comfortable and confident in it; this is progress on an already solid foundation.

Spatig: The IoT opens up new opportunities for physical security, in that it provides a better and more simplified means of controlling and monitoring access to devices, systems, and equipment. In equipment-level access applications, for instance, the IoT can be used to provide real-time monitoring of equipment status, in addition to feedback on maintenance and physical security, optimization, and efficiency of connected systems.

However, standardization around communication protocols is critical to the overall growth of the IoT. Device designers will require standardized communication modules to allow for streamlined integration with connected systems. The Bluetooth Special Interest Group (SIG) is an excellent example of global standardization and optimization of a technology that supports IoT.

Allen Tubbs: Industry 4.0/IoT/IIoT (Industrial Intent of Things)  are ongoing realities. Some technologies and processes that will make it possible are already in place. Others that are needed for a fully networked, digitized industry are under development. Also, nearly everyone has different definition for the term “Industry 4.0,” so they may think it’s simply too complicated and not for them. They don’t understand the benefits that might result. The important thing is to work toward implementing production systems, processes, and technologies that can be used today to make that future possible.

The industrial embrace of IIoT will benefit everyone, including consumers, by making production more efficient and lowering costs. As for consumer products that are IoT-enabled, it is difficult for us to comment as an industrial company. But if you consider how appliances, tools, and other consumer goods have evolved over the years, it is likely that these products will also quickly become widely available.

Companies might be able to save money by implementing IoT. What is the driving factor for consumers to make the leap?

Spatig: Consumers will benefit from the convenience IoT offers. A leading design factor in the development of remote, wirelessly operated systems is their ability to be controlled via smartphone, tablet, or any other wireless personal device. When connected with the IoT, consumers will have more opportunities to control, track, and monitor their devices from one central point.

Wilkerson: The benefits for individuals appeal more to tech-savvy consumers who will embrace the connected world and use the technology to simplify certain tasks in their life.

Difalco: IoT adoption is driven by the benefits it produces. Whether these benefits are lower costs, greater convenience and safety, or better and faster access to information, consumers and business will move only if (and when) they see value in it. A few consumer benefits of IoT include: better, more economical health-care outcomes from remote patient monitoring; efficient scheduling and use of household appliances that consider utility tariffs and loads; and greater convenience as a result of infrastructure-enabled traffic management.

Michalkowski: Consumers are also looking for flexibility and comfort. And to be welcomed by a home that saves energy over the day, but is right temperature when the owner comes back is a nice argument.

There seems to be lack of IoT standards for hardware, software, security, and data transmission and communication protocols. Should those issues be decided by the marketplace or by government? How do you think those issues will be decided? Will there be standards?

Michalkowski: Common standards have to be defined, as many products from different suppliers have to communicate with each other. To set the standards is a common task of the marketplace, government, and non-industrial organizations.

Wilkerson: Standards development should be left to the marketplace, but in reality it will most likely be a mix of government-defined regulation and industry-specific standards. Due to the massive scale of devices and information that will make up the IoT, standards need to be developed to protect consumers and businesses.

Spatig: Standards are best handled by market-based associations, such as Bluetooth SIG, that have direct experience with industry market requirements and the technology, and should be looked to for guidance as the IoT continues to evolve.

Tubbs: Bosch Rexroth is committed to “open standards” and believes they are an essential element for the success of Industry 4.0. Industry 4.0 calls for industry-wide standards with regard to information sharing. A variety of industry groups exist to help define these standards, and we, along with many other companies and interested parties, are participating actively in them. Nevertheless, opportunities exist now, and we are pushing “openness” as a critical element in helping manufacturing companies take advantage of them. Our Open Core Interface, for example, lets users access drive or control systems with standard IT languages. We are committed to using open standards to make our products, including hydraulics, especially well-suited to Industry 4.0.

Difalco: There will be standards—there are, already. And ultimately, future standards, like those already in place, must be accepted by the marketplace, even if governments get involved and dictate or contribute. Ultimately, if the marketplace doesn’t accept a standard, it will have a limited audience.

If a company designs and builds something such as industrial motors, large blades for wind turbines, or linear actuators, should the company be more focused on embedding IoT technology into their products or in the processes they use to make the products? Why?

Tubbs: Most manufacturers will do both. If there is cost-effective information that can be collected from the product for the end-user, then it makes sense for the manufacturer to design that benefit into their product at the production stage. At the same time, if the manufacturer sees the benefit in providing such information to their own customer, it probably sees the benefit of using similar data in its own manufacturing processes. At Bosch, we implement many of our solutions at our own manufacturing plants as a first step, to learn about and optimize the solution for the broader marketplace.

Michalkowski: Both! If IoT is only implemented in the process to make the components, then this is only half of the way. Components makers must also help customers become more efficient and this means IoT must be integrated into products so users can benefit too. In production, IoT will help companies be flexible in making product s that meet market requirements.  IoT will also help users be more flexible and effective.

Difalco: Successful companies focus their attention on serving their customers. Whether they do that by building the most reliable, fastest, or least expensive product is part of the product and marketing strategy. Not to minimize the magic of the IoT, but embedding IoT technology into their product or process is simply a “feature” question the company and its engineers answer as part of their cost/benefit analysis.

Wilkerson: We think there is benefit to both. There is potential intelligence, process improvement, labor savings, traceability metrics, and more that can be derived from the process and product side of the equation.

Spatig: Companies should be more focused on the product and processes within their areas of expertise, as this is where they can add the most value. IoT technology should follow standards that allow for simple integration into any device, system, or piece of equipment. Device manufacturers should focus on their core competencies, and IoT system and network providers should focus on standardizing and optimizing IoT technology to best support the growth of the industry.

How will U.S. companies deal with all the new information they glean from the IoT? How will they ramp up their Big Data analytical capabilities? And is there a guarantee they will all profit from the results?

Michalkowski: Looking at Amazon, Google, and so on, Big Data analytical capabilities already exist. The next step is to use this knowledge also for industrial applications . But there is never a guarantee for success.

Difalco: Sir Francis Bacon said, “Knowledge is Power” in 1597. It remains so today. Still, companies will need to decide how to use that knowledge—and there are no guarantees that they will do so successfully.

Wilkerson: There are no guarantees; but most businesses will benefit from more reliable real-time information that can be gleaned from the connected world. How the influx of data will be managed will be different from company to company; the businesses or industries that can more quickly scale their resources to put the data to use will obviously benefit the most.

Spatig: Data collected from the IoT will require new analytics that let companies best leverage the increased information. Companies will need to shift from traditional methods of data gathering, such as spreadsheets and manual data entry, to software or cloud-based Internet data analysis and monitoring. Though there is no guarantee of profit, one of the key benefits of applying the IoT is that it helps companies become more efficient by reducing costs and improving productivity, which should ultimately lead to increased profits.

For example, wireless, Web-based access controls could significantly reduce costs associated with installation, maintenance, and administration of traditional wired systems in building and equipment access applications. Security administrators can then easily add and remove access-control credentials, which can be managed remotely through cloud-based Web portals.

Tubbs: The real profits will come by creating and gathering data around identified problems. This usually means starting small and solving one problem at a time. The infrastructure will build up as more profitable data-analysis systems are needed and built. It isn’t necessary to have an expensive data collection system in place before beginning to solve problems. The analysis and profit analysis come at the beginning of the process, when a problem is identified and defined. At that point, sensors, servers, and analytics are designed in according to the anticipated profits of solving the problem surrounding the process.

Will there be any losers in the race to IoT?

Difalco: Any competitive market will always have winners and losers.

Wilkerson: There are winners and losers in everything. If sizable businesses are interested in growth and gaining market share, then they must be prepared. With the IoT, planning is now and if you’re not investing for the future and making use of the technology at hand, you stand a strong chance of getting left behind.

Spatig: Legacy solutions like traditional wired, analog-based control systems may be left behind. Wireless devices require less hardware and less maintenance, which could potentially lead to the elimination of layers of installation and maintenance requirements. Service and technology providers will need to embrace this new paradigm to keep up with the market.

Michalkowski: The ones who do not fulfill the requirements of the market will suffer, but this is not related to only IoT.

Tubbs: Only those who don’t pay attention. It is tantamount to refusing to know your competition. In some respects, the IoT is just a new name for gathering data to stay competitive.

What is a likely timeline for IoT implementation?

Difalco: If we agree that the Internet is already well established and there are lots and lots of things connected to it, then there may be a timeline for connection of a particular application or “thing” to the IoT, but there is no timeline for IoT implementation.

Wilkerson: As for the overall timeline, we have years ahead of us before the masses realize the full benefits. In the short term, there are plenty of businesses putting pieces into place that will continually grow into much larger connected events or “things.”

Spatig: IoT implementation is currently underway and will continue to evolve and grow into new areas. For example, on the access-control side, there is an existing legacy infrastructure in place that will require a shift from these systems, to a new way of thinking—especially with regard to how these new devices network and communicate with each other. As the IoT becomes more prevalent, there will be an evolving process to accommodate the paradigm shift from individual wired devices to a wireless network of connected devices.

Michalkowski: Looking at social networks, you can see the implementation has already started, and will be going on for years. It is not a revolution, but an evolutionary process. A lot of applications exist today, but they are insulated. The timeline of implementation is therefore very much affected by the realization of the easy and simple communication between the different applications.

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