Industrial IoT in the Time of Covid-19 – uncovers electrical utilities companies’ plans to significantly increase IoT investment and boost cost savings
New research by Inmarsat, the world leader in global mobile satellite communications, reveals that investment in the Internet of Things (IoT) is set to equal cloud computing and overtake next generation security, big data analytics and other digital transformation technologies across the electrical utilities sector in the near future. Electrical utilities respondents reported plans to invest the greatest proportion of their IT budget on IoT and cloud computing projects over the next three years.
IoT has reached a high level of maturity across most organisations, with electrical utilities businesses now planning to spend an average of $3.1 million on their IoT investments through to 2024. While IoT accounted for an average of 8.3 per cent of a typical electrical utilities organisation’s IT budget between 2017 and 2020, businesses are planning to spend 9.9 per cent of their IT budgets on IoT projects over the next three years. Planned investments in IoT are equal to those for cloud computing (also 9.9 per cent) and notably higher than those earmarked for other Industry 4.0 technologies, including next generation security (8.3 per cent), big data analytics (7.5 per cent), machine learning (5.5 per cent), and robotics (5.5 per cent).
In addition to receiving more investment than most other technologies vying for IT budgets, the new research also reveals that the mainstream adoption of IoT across the electrical utilities sector is already making a significant difference in terms of operational cost-savings to many organisations. On average, electrical utilities respondents report that IoT projects currently save their organisations 10 per cent of their yearly costs. In the future, respondents expect to achieve an average of 16 per cent cost-savings in 12 months’ time, rising to 23 per cent in three years and 30 per cent in five years’ time.
IoT budgets for the electrical utilities sector are higher than most other industry sectors, with an average planned spend on IoT projects in the next three years of $3.1 million, which is higher than planned IoT investments in agriculture ($2 million), transport and logistics (£3 million) and mining ($2.7 million), and slightly lower than oil and gas ($3.2 million).
Commenting on IoT investments in the electrical utilities sector, Damian Lewis, Market Development at Inmarsat, said: “The sector’s IoT maturity is reflected in the proportion of IT budget that a typical organisation allocates to IoT projects. Our research reveals that over the next three years, planned investment in IoT is now equal to that for cloud computing and higher than all other digital transformation technologies. Even though IoT is well-embedded into energy generators’ and network operator’s IT strategies, this continued commitment to high levels of investment suggests a clear IoT roadmap is in place for most businesses. It also demonstrates the clear business benefits IoT projects are already having in the sector.”
Commenting on the findings, Mike Carter, President of Inmarsat Enterprise said: “Our latest research reveals IoT is now the primary Industry 4.0 technology in which companies are investing over the next three years. The emergence of IoT as an investment priority for businesses, and the increasing level of cost-savings they expect IoT to deliver in the years ahead, clearly demonstrates how well-established a technology IoT has become in electrical utilities. However, there are still several significant areas for all organisations on which to improve to draw optimum benefits from the technology, namely: securing reliable connectivity, improving data management and addressing their IoT skills gaps and security concerns.
“Despite already seeing rapidly increasing levels of IoT adoption, Covid-19 has emphasised the importance of Industry 4.0 technologies like IoT for business continuity. With the world’s production and supply chains becoming increasingly interconnected and digitalised, those companies producing digital twins of their supply chains and sharing data, are the ones reaping the benefits.
“Inmarsat ELERA, our industry-leading narrowband network, is ideally suited to the rapidly evolving world of IoT and the billions of devices that are being connected every year, delivering global reach, extraordinary resilience, and the fastest speeds, along with the smallest, lowest-cost terminals in their class. ELERA is inspiring new possibilities and enabling organisations from all sectors to access IoT anywhere and will be a catalyst for the next wave of world-changing technologies. Organisations looking to accelerate their IoT deployments need look no further than Inmarsat and our global partner ecosystem – the widest of any satellite provider – to solve their IoT connectivity needs.”