Following a spate of internet-connected devices announced at IFA 2014, including a smart mirror and a plethora of smartwatches, it is clear that the Internet of Things (IoT) is gathering momentum.
Increasing amounts of everyday devices are finding ways to make use of the internet and the data that flows along it, to have an effect of the lives of both consumers and corporations.
However, all these devices transmitting and receiving data are all but useless unless that data can be analysed and turned into insightful information. Such information can be used by an organisation to either identify new revenue opportunities or optimise operations.
Yet, in research we carried out in partnership with Intel, it was revealed that only 18 percent of businesses embracing the IoT use any form of analytics on their harvested data.
Such findings come as a surprise, particularly when Jamie Moss, senior analyst at Ovum, declares that, "analytics are critical to the future of the IoT".
Without any form of data analysis, Moss believes the IoT is little more than a trendy gimmick designed "to sell more stuff", rather than add any value to the technology industry.
Stuart Wells, chief technology officer at predictive analytics company FICO, told V3 that simply collecting data is a step in the right direction for businesses, but further analysis is crucial.
"The real value is in translating and extracting noisy data. Valuable information is typically hidden in data and has to be identified and enhanced before it can be consumed in decisions," explained Wells.
However, analysing a vast smorgasbord of data is no easy task. Clive Longbottom, principal analyst at Quocirca, told V3 companies wishing to use IoT data must first work out what they aim to achieve from analytics before taking a potentially expensive plunge.
"The first thing any organisation has to start with is desired outcomes – why are they looking at using an analysis of the IoT in the first place? What impact are they hoping for at the bottom line; what processes will be changed by any findings; what learnings can they take away with any findings? If they cannot answer these questions, then they are not at a maturity point to make it all worthwhile," he said.
Achieving Longbottom's recommendations may take a skillset beyond those commonly found in corporations.
Jim Tully, chief of research at Gartner, told V3 enterprises will need to recruit external experts with the skills to determine what type of data is important to individual businesses.
"When you bring in the IoT you're bringing in a lot more operational data, and data scientists familiar with operational analytics are quite rare," explained Tully.
With the right people on board a company can then start exploring how to make the most of IoT analytics.
A myriad of tools exist that can sift through and extract data once they have been programmed with the parameters to seek out the useful information from raw data.
Whatever the tools used, the ideal goal is to put a system in place that can automate the process of collecting and processing raw data, which can then be used to deliver business insight.
However, for all but the largest of companies, doing this internally can be prohibitively expensive.
But an alternative exists in the form of specialist data analytics providers. While large technology companies providing software and other IT services look to add analytics into their products, Ovum's Moss said that smaller companies offering specialist analytics products, services and consultancy are now emerging.
These new firms will offer SMEs carefully tailored IoT data analysis at affordable prices, challenging the services on offer from major IT brands.
With Gartner predicting that the IoT's total economic value will be worth a staggering $1.9tn by 2020, many more companies may well embrace analytics with enthusiasm to reap the rewards the IoT brings.
For more on the IoT analytics, visit the Intel IT Center.
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