IoT is now business-critical in Europe as global IoT adoption continues

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IoT is now business-critical in Europe as global IoT adoption continues

By Søren Lau, General Manager, EMEA IoT Partner Ecosystem at Microsoft.

The Internet of Things (IoT) has exploded in power, sophistication, and importance, fuelling a fourth industrial revolution. Today, businesses in all industries are using it to drive efficiency, productivity, safety, and growth across their operations. But as the latest Microsoft IoT Signals report shows, companies in Europe are the ones that consider IoT to be most critical to their success.

The report also shows some key trends across Europe. The global study of over 3,000 business decision makers (BDMs), developers, and internet technology decision makers (ITDMs) across ten countries – including the UK, France, Germany, Spain, Italy, and the Benelux markets – shows that, on average, 90.8 percent of European companies have adopted IoT (compared to 94 and 89.7 percent in the United States and Asia respectively). Italy leads the way globally with 95 percent adoption. It also shows that IoT is seen as business-critical by more firms in Europe (91.5 percent on average) than in either Asia (90.3%) or the United States (85%).

table: IoT adoption in Europe

The research also shows that, across Europe, organizations in Spain are more likely to see IoT as critical to the success of their company (96%) – second only to China (99%) – and that those in the Benelux markets are most satisfied with IoT. In fact, all of these surveyed report high levels of satisfaction. It also found that businesses in France report the highest rates of success with their IoT projects across Europe. Diving deeper, several trends emerge from the report that are relevant to organizations across Europe.

1. COVID-19 is set to fuel further investment in IoT

Rather than slowing investment in IoT, the global COVID-19 crisis is actually driving even further growth. Last year, 31 percent of organizations said they expected to increase their investment in IoT as a result of the pandemic, but the latest IoT Signals report found that this has jumped to 44 percent – with a further 44 percent saying they will maintain the same level of commitment.

It seems that IoT maturity plays a key part in this trend. Delving deeper into the characteristics of organizations that intend to strengthen their investment, we find that they tend to use IoT in more ways than others (e.g., for sales enablement and sustainability applications, not just the more usual quality, security, and productivity reasons), and are more likely to have incorporated emerging technologies such as AI, edge computing, and digital twins into their IoT programs.

It would therefore appear that greater IoT adoption leads to more value, which in turn means companies seek out more use cases and tighter integration with other technologies and, as they begin to reap the benefits, their investment in IoT either continues or increases. In short, European firms that adopt IoT and apply it to their businesses see more value and invest further.

2. Emerging technologies accelerate IoT adoption

Across Europe, awareness of emerging technologies like artificial intelligence (AI), edge computing, and digital twins, is high, although on average not quite as high as in the United States or Asia. Ninety-nice percent of organizations surveyed in Europe are aware of AI; whereas, awareness of edge computing sits at 98.3 percent, and for digital twins it’s 89.2 percent. However, this simplifies the significant differences across the six European markets included in the study, as the prevalence of both strategies and usage in IoT solutions varies by as much as 21 percentage points between markets. For example, German companies are most likely to have an AI strategy (88%) yet least likely to be using AI in their IoT solutions (68%). Similarly, whilst only 67 percent of companies in Spain have an edge computing strategy, 88 percent of their French counterpart’s report having one.

Whilst this reflects what many of us already know about how European markets progress at different rates, there are also clear links between the use of emerging technologies and IoT adoption and value. Specifically, across Europe the use of both AI and digital twins’ technology correlates positively with IoT adoption and satisfaction, thus accelerating IoT adoption.

3. Industry IoT solutions drive broader benefits

The IoT Signals report analysed several industries in depth. Organizations in France and Spain might note, for instance, how energy, power, and utilities companies are using IoT to help with grid automation (44%) and maintenance (43%), while oil and gas companies are more likely to apply it to workplace and employee safety (45% and 43% respectively). Energy companies are also more likely to use AI in their IoT solutions than other industries (89% vs 79% for all verticals). The benefits of IoT being seen by organizations in these sectors include improvements in multiple areas, including operational efficiency, production capacity, and customer satisfaction.

In Germany and Italy, where manufacturing makes up an important part of each market, more IoT projects tend to be in use (26%) than in other sectors. Solutions in this sector are focused primarily on quality, industrial automation, and monitoring, providing greater operational efficiency and production capacity to drive competitive advantage.

In many European countries, smart places are getting a lot of attention, and this is where the highest levels of IoT adoption (94%) and overall satisfaction (98%) are found. The top applications of IoT in smart places are around productivity and building safety, with organizations benefiting from improved operational efficiency and personal safety.

4. IoT boosts sustainability goals

The report also highlights that one-third (34%) of organizations surveyed view sustainability as a top priority, and the majority of those view IoT as a key contributing factor. In fact, almost three-quarters (73%) of organizations with near-term net zero ambitions consider IoT to be very important to their progress against sustainability goals.

IoT is therefore a key enabler of net zero strategies across industries, where data and insights gathered from IoT can be used to directly support carbon emissions reporting and disclosure. For example, connected renewables and EV charging – with the help of AI and machine learning – are ensuring maximum availability and limiting costly downtime in the energy sector. In addition, building energy management solutions are helping organizations to reduce their energy consumption by up to 25 percent whilst also reducing operating costs.

It’s clear from the report that IoT is here to stay, and despite the differences between markets, companies across Europe are reaping the benefits.

Download the full Microsoft IoT Signals report for a more detailed exploration of how businesses in Europe and across the globe are leveraging IoT – as well as drilldowns into topics such as security, implementation strategy, and sustainability.

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This UrIoTNews article is syndicated fromIoTBusinessNews

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