The technology behind the internet of things (IoT) has been a long time in the making. But it wasn’t until the early 2000s when home automation solutions began hitting the market that IoT started becoming a household term.

Fast-forward a couple of decades and IoT has exploded, not only in power and sophistication but in importance, helping to fuel the fourth industrial revolution. Today, businesses across every industry are using IoT to drive efficiency, productivity, safety, and growth across their operations.

And it’s only picking up steam, as evidenced by the newly released 2021 IoT Signals report. As IoT evolves—along with innovations like AI, digital twins, and edge computing—businesses are combining these technologies to connect complex environments and deliver results never before imagined.

Below, we’ve highlighted five key adoption trends from the 2021 IoT Signals report. Plus, we’ll share how advancements in Azure IoT technology are helping customers streamline and secure solutions and revolutionize business.

5 key trends in IoT adoption for 2021

Now in its third edition, IoT Signals compiles inputs from more than 3,000 business and IT decision makers and developers, surfacing insights across industries and revealing trends, emerging technologies, common challenges, and more. This year’s edition also takes a deeper dive into areas such as security and best practices, implementation strategies, and IoT for sustainability.

1. 90 percent of the organizations surveyed are adopting IoT

IoT isn’t slowing down. Levels of IoT adoption remain high, on par with 2020, with 90 percent of adopters stating that IoT is critical to their success. The top reasons for adopting IoT include quality, security, and resource optimization. In fact, organizations that adopt IoT in the areas of cloud security, supply chain, and sustainability consider IoT as even more critical to their overall success.

2. COVID-19 continues to accelerate IoT adoption across industries

One of the unexpected impacts of the global health pandemic is that 44 percent of the organizations surveyed plan to invest even more in IoT as a result of COVID-19, compared to 31 percent in 2020. Most of these companies are already using IoT, and close to half attribute increased revenue to the technology. 

3. Reducing technical complexity helps speed IoT time to market

Technical challenges can slow progress, often stalling projects in the proof-of-concept (PoC) phase. The need to solve existing challenges before adding or using IoT thwarts a third of implementations and contending with technology demands impacts 28 percent. Solving these challenges can help organizations benefit from IoT more quickly and pave the way for widespread IoT adoption.

4. Unsurprisingly, IoT security is a major priority

In fact, 91 percent of survey participants expressed concerns about IoT security. Data privacy tops the list of security worries at 46 percent, followed by network-level security at 40 percent. Other concerns include device security endpoints, managing and tracking each device, and ensuring software and firmware updates are made. Interestingly, organizations are not using a common best practice approach to security, with only 43 percent designing measures that assume breaches at every level of their IoT projects.

5. The vast majority of IoT adopters integrate emerging technologies

Most organizations are leveraging technologies such as AI, digital twins, and edge computing as part of their IoT solutions. 81 percent of organizations that leverage edge computing or digital twins as part of IoT state that these technologies are core or secondary components. We will go into more detail on emerging tech below.

Streamlining highly secure IoT solutions

While IoT adoption is trending upward, it’s clear that solutions must be more secure and easier to implement. The Azure team continues to prioritize investments that remove friction and technical complexity and streamline solutions at scale. We’re also continuing to prioritize stringent, built-in, cloud-to-silicon security measures to help safeguard data, devices, and operating environments.

A great example is Azure IoT Central, which provides a common platform for creating and managing secure, enterprise-grade IoT solutions. Recent innovations are helping organizations to minimize technical and security hurdles and bring solutions to market more quickly. In late 2020, we released IoT Plug and Play, which simplifies secure, end-to-end IoT solutions through no-code device configuration, drastically reducing cost and development time. We’ve also added Azure IoT support for multi-tenant solutions, making it easier to scale, manage, and safeguard IoT across multiple organizations.

Integrating emerging technologies with IoT

Augmenting IoT with emerging technologies like AI, edge computing, and digital twins is a priority for most IoT adopters. Together with IoT, emerging technologies are connecting highly complex environments to power experiences and scenarios never before imagined. Microsoft offers a range of solutions that are helping bring these projects to fruition.

AI and IoT

According to IoT Signals, 79 percent of businesses are successfully adopting AI within their IoT solutions. The top reasons cited include predictive maintenance at 67 percent, followed by prescriptive maintenance at 65 percent. Additionally, 56 percent of organizations are combining AI and IoT to create a better user experience.

At the same time, 46 percent of businesses with AI strategies are struggling to get their projects past the PoC stage. Azure AI simplifies integration by enabling access to high-quality AI models—including vision, speech, language, and even decision-making—using simple API calls. Azure AI integrates with Azure IoT solutions, enabling organizations to unleash a multitude of custom use cases. For example, RXR Realty, one of the largest real estate companies in New York, combined Azure AI with Azure IoT to monitor building health, supporting a safer return to the office during COVID-19.

Edge computing and IoT

By shifting AI, analytics, and business logic to edge devices, edge computing can help solve speed, latency, security, and reliability challenges. Combining edge computing with IoT opens a world of possibilities.

52 percent of IoT Signals respondents indicate that they are very familiar with edge computing as compared to 42 percent one year ago. Of those organizations, 79 percent have an edge computing strategy, 81 percent of whom are combining edge computing and IoT. The most common use cases include cloud security at 40 percent, device and asset security at 36 percent, and quality assurance at 35 percent.

These organizations also face technical challenges in getting solutions out of PoC, which means removing friction and complexity are vital. Built on Azure IoT Hub, Azure IoT Edge simplifies running cloud workloads at the edge on certified IoT devices. Using familiar coding languages, developers can enable data processing at the device level, ensuring only what’s needed is sent to the cloud. Additionally, the tiny but mighty Azure RTOS seamlessly connects popular microcontroller units (MCUs) to the power of Azure IoT, providing embedded developers the ability to quickly build applications on resource-constrained devices.

To make it easier to combine AI and IoT at the edge, we recently introduced Azure Percept. This comprehensive solution contains prebuilt AI models and built-in security measures and works out-of-the-box with Azure Cognitive Services and Azure Machine Learning. The city of Kortrijk in Belgium used Azure Percept to gain insights into pedestrian movement and density to help keep people safer and improve city operations.

Digital twins and IoT

The ability of digital twins to replicate physical environments and model relationships and interactions is truly revolutionary. The technology has caught the attention of IoT Signals survey participants, most of whom indicate that they are aware of digital twins and 77 percent of whom have a strategy in place. Of the 81 percent that incorporates digital twins into their IoT solution, three quarters report improved quality as a benefit. In addition, 63 percent enjoy increased revenue and 59 percent experience reduced operation costs.

Again, these adopters list technical complexity as a challenge. To help alleviate complexity, Azure Digital Twins combines digital twins and IoT into a single platform. It allows organizations to model entire connected environments using an open modeling language. For example, Doosan worked with Bentley Systems to create a digital replica of wind farms using Azure Digital Twins. The digital twin enables them to maximize energy production and remotely monitor facilities. Other companies, like Johnson Controls, are using Azure Digital Twins to transform how buildings and spaces are built and managed.

Download the 2021 IoT Signals report

We’ve only just scratched the surface of how IoT is reshaping business and how Azure IoT is rising to the challenge of providing secure, streamlined solutions. As technologies evolve, IoT is becoming simpler and more affordable. To learn how IoT is accelerating growth for businesses like yours, we urge you to download the 2021 IoT Signals report.