Over the last few years, many people—myself included—have been touting the Internet of Things (IoT) as a driving force behind digital transformation. But is IoT by itself truly that transformational? Well, I would argue that it is not. IoT focuses mainly on securely connecting devices that generate data. It is a key element of disruption and change, but it needs to partner with other technologies such as artificial intelligence (AI), blockchain and fog computing to create billions—some say trillions—of dollars in value and transform industries.

Let’s take a closer look at these cross-technology relationships:

AI is the brain, IoT is the body.

IoT and AI have a remarkably synergistic relationship. AI, especially machine learning, provides intelligence—the ability to evaluate options, learn from experience and make smart decisions. IoT, like the body, provides the ability to sense and act. IoT delivers both the data AI needs, and the physical means to act on AI’s decisions.

The convergence of AI and IoT is creating countless new opportunities. For example, remote healthcare monitoring offers in-home diagnostics, analyzing a 24×7 stream of data and providing insights for care. In manufacturing, predictive analytics give production managers the intelligence to evaluate the trade-offs between building a new plant, for example, or buying extra capacity as needed. And preventive maintenance systems use IoT data plus AI to predict and prevent equipment problems before they happen.

Blockchain and IoT create a secure Internet of value.

Now, let’s add blockchain technology to the mix. Blockchain allows a secure exchange of value between entities in distributed networks. Having a trusted means of transferring and tracking assets, capabilities or transactions online enables a completely new class of IoT applications and can help address one of the biggest barriers to IoT adoption—data security. For example, an energy company is looking at blockchain to manage the interactions between solar panels and the power grid. And automakers are considering the technology to authenticate the interactions between connected vehicles and roadside infrastructure.

Since blockchain creates a tamper-proof record of transactions, it can also trace and authenticate the source of goods throughout production and distribution, preventing counterfeit components from being introduced and isolating the sources of quality issues.

Fog Computing brings the power of the cloud down to earth.

Cloud technology has sparked a data processing revolution, but it is often inadequate to address real-time demands of new bandwidth-intensive applications. The first generation of cloud focused on batch processing of large amounts of data such as seismic surveys, or non-time-sensitive IoT use cases such as basic connected vending machines.

But now consider an offshore oilrig. Its thousands of sensors generate one to two terabytes of data per day, which would take days to transmit to the cloud using a satellite connection. Enter distributed cloud capabilities—or fog computing. By extending the existing cloud architectures to the oilrig itself, fog computing enables real-time data to be processed and analyzed locally based on policies coming from the cloud with only exceptions and alerts sent over the satellite link.

Integration powers acceleration.

While each of these technologies enables new IoT applications and accelerates adoption, their impact is multiplied when we bring them together. Let’s look at autonomous drones and autonomous vehicles as examples.

IoT turns drones into high-value tools when combined with AI, fog computing and blockchain. Such autonomous drones can work longer and more efficiently than piloted drones. They can choose the most efficient flight path automatically, and change it on the fly to avoid bad weather, trees or power lines. They can even operate in dark, obstacle-filled environments beyond the reach of the Internet and GPS. Such drones are ready for mission-critical applications — whether that means an inspection of a gas pipeline or secure package delivery in New York City. The U.S. military is experimenting with using “swarms” of drones that communicate with each other in the air and collaborate to devise the best way to accomplish their collective mission.

Similarly, consider an autonomous car, packed with navigational sensors, cameras, LiDAR and inertial systems. Such level 3 or level 4 vehicles would generate an estimated two to four petabytes of data per year. Fog nodes process all this streaming data and distributed AI engines make decisions based on this information, right there inside the vehicle. Just add high integrity data made immutable by blockchain, and now the car can dynamically choose the best route, respond in real time to the movements of nearby vehicles and pedestrians, and stop safely on icy roads, all with a high degree of confidence.

IoT, AI, blockchain and fog computing are the building blocks of digital transformation. Each one contributes important capabilities, but they need each other to be truly transformational. Only together do they have the potential to fulfill the lofty expectations of IoT.

This article first appeared in Network World.



Maciej Kranz

Vice President and General Manager

Corporate Strategic Innovation Group