The speed at which technology is reshaping the world today, is unprecedented. Realizing the grand potential of imbibing technology in industry, most developed nations of the world had already started upgrading their facilities much earlier. The time is ripe for India to harness the opportunities brought forth by technology.
An already critical global trade and geopolitical turmoil has been further intensified by the onset of Covid-19, making it more important for India to demonstrate her ability to respond to the “New Normal”. The corporate leaders of the nation must also ensure they capitalize the opportunity to amplify India’s market share in the manufacturing economy of the world.
The pandemic has intensified the focus of Indian companies towards Industry 4.0. Adopting digital technologies and investing in services and products that can help them thrive in the present swiftly evolving economic environment have become two most important factors to Indian companies. IoT is the most critical technology driving industrial 4.0 revolution, despite of several challenges.
Significance of IoT in Industry 4.0
Industry 4.0 basically constitutes a bunch of technologies that modernize the mechanism of manufacturing. According to Deloitte Global’s third annual survey, 72% CXOs think IoT technology is their top priority and most likely to have greatest impact on their companies. AI, Cloud and BigData/analytics have emerged as the other three most crucial technologies constituting the “Big Four Technologies” that would provide the groundwork to connect organizations, by generating data and driving smarter operations. IoT uses sensors, network and analytics to provide the tools vital for data collection and insight generation. Thus, making IoT the most significant component of the digital technologies of Industry 4.0.
The Market Potential of IoT
Global spending on IoT related software and hardware is expected to grow swiftly, from US$726 billion in 2019 to US$1.1 trillion in 2023. According to recent report, Asia Pacific region spent the most on IoT in 2019, out of which India accounted for a total expenditure of US$20.6 billion.
Covid-19 has given rise to 3 trends in India – First, Economic slump and probable degrowth till the first quarter of 2021, second, increased spending on IoT mandated by companies and thirdly, a speedy recovery post the second quarter of 2021 after Covid-19 vaccine or cure is found. The same report estimates that the IoT market in the industrial sector will grow at a CAGR of 16.7% from 2019 and touch US$263.4 billion by 2027.
Roadblocks for IoT adoption in India
The transformational nature of IoT is transformational is widely accepted globally. IoT adoption in India, however, is still in a nascent stage due to the following challenges.
- Dearth of clarity on what needs prioritization
- Lack of long-term vision and emphasis on short-term value realization
- Scarcity of talent, rightly skilled for maintaining and implementing IoT ecosystem
- Technical issues of connectivity, interoperability, compatibility and cybersecurity
IoT as a Driver of Revenue
Presently companies perceive IoT as a cost but when they realize the multitude of benefits that connected operations can bring into the organization, that hesitation will diminish. IoT can also generate various monetization opportunities that can help companies to generate revenue. Few data driven monetization models are:
- Data as a service: Selling the data captured in the system
- Insights as a service: Selling insights derived from analyzing the data captured in IoT platform
- Platform as service: Licensing IoT platform to others
- Business as a service: Enabling companies to offer a business capability as a service
Future of IoT
IoT technologies offer extraordinary growth opportunities by saving cost and generating new revenue lines. Indian industry is at the cusp of a massive transformation that has been exaggerated by disruptions caused by the Covid-19 pandemic.
Most company leaders understand that IoT can upgrade the standard of their organization and help them to become competitive in the global market. A little nudge from the government and substantial support from technology providers, in the form of offering India-specific solutions is all that is keeping India from becoming an IoT powerhouse.