The Internet of Things (IoT) is having a huge impact on consumer’s lives and corporate business models, as technology advances and the cost of creating wearables and smart devices continues to drop.
In fact, Gartner predicts that more than half of major new business processes and systems will incorporate some element of the IoT by 2020.
Furthermore, Gartner says through 2018, 75% of IoT projects will take up to twice as long as planned; by 2020 a black market exceeding $5 billion will sell fake sensor and video data; and IoT security will have increased security costs to 20% of annual security budgets.
Roy Schulte, Gartner vice president and distinguished analyst, says uses of the IoT will become increasingly practical and proliferate throughout businesses.
He says, "The IoT is relevant in virtually every industry, although not in every application. There will be no purely 'IoT applications.' Rather, there will be many applications that leverage the IoT in some small or large aspect of their work.
“As a result, business analysts and developers of information-centric processes need to have the expertise and the tools to implement IoT aspects that play a role in their systems.”
IoT projects will run over budget and take twice the time
Gartner expects three out of four IoT projects to face schedule extensions of up to 100% with the consequent cost overruns - the more ambitious and complicated the project, the greater the schedule overruns.
For some projects, compromises will be made to keep them on-schedule, leading to significant weaknesses in performance, security or integration into existing processes.
In the mid-to-long term, these compromises will require that the IoT project be re-factored and perhaps even recalled and re-deployed, Gartner says.
"Product-centred enterprises will be the worst affected," says Alfonso Velosa, Gartner research vice president.
"They will seek to launch smarter, connected products, although this will often be a reactive, tactical approach that seeks to address their competition's IoT product.
“However, even for enterprises conducting internally centred projects that may focus on cost reductions, there will be people issues.
“Most of these issues will centre on the normal introduction of a new technology model. It will be complicated by emerging business models that will require process and cultural change. Addressing both of these will lead to projects going over schedule,” Velosa says.
A growing black market will enable criminal activity and protecting personal privacy
The nature of IoT solutions, how they are deployed, and the types of data they generate and consume are giving rise to new security and privacy implications that organisations must begin to address, Gartner says.
This is a rapidly escalating risk to the organisation, bringing complexity unfamiliar to most IT and business leaders, according to the analysts.
"The IoT has enormous potential to collect continuous data about our environment," says Ted Friedman, Garnter vice president and distinguished analyst.
"The integrity of this data will be important in making personal and business decisions, from medical diagnoses to environmental protection, from commands to modify actions of machinery to identification and authorisation of physical access.
“A black market for fake or corrupted sensor and video data will mean that data can be compromised or substituted with inaccurate or deliberately manipulated data.
“This scenario will spur the growth of privacy products and services, resulting in an extensive public discussion regarding the future of privacy, the means to protect individual privacy, and the role of technology and government in privacy protection,” he says.
IoT security will be at the forefront of business decisions
As use of IoT devices grows, however, the unique requirements of IoT architecture, design and implementation over multiple industry segments and scenarios will also grow.
As a result, Gartner believes that the average security budget for IT, operational technology (OT) and IoT security requirements will respond to the growth of IoT devices across all business segments and scenarios, rising from less than 1% of annual security budgets in 2015 to 20% in 2020.
"Major cybersecurity vendors and service providers are already delivering roadmaps and architecture of IoT security, in anticipation of market opportunity," says Earl Perkins, Gartner research vice president.
"Small startups delivering niche IoT security in areas such as network segmentation, device-to-device authentication and simple data encryption are offering first-generation products and services, including cloud-based solutions where applicable.
“Large security vendors have already begun acquiring some of these IoT startups to support their early roadmaps and fill niches in their portfolios."