Frost & Sullivan: The major challenges facing the IIoT solution market in 2018
A recent Frost & Sullivan research shows that the major challenge currently facing the Industrial Internet of Things (IIoT) solution market is the inability of providers to offer one-stop- shop solutions. Original equipment manufacturers (OEMs), such as pump, motor and variable frequency drives (VFD) companies, want to leverage IIoT and bundle their products with IIoT products. Unfortunately, pump manufacturers must work with sensor manufacturers, hardware suppliers, software providers, and cloud storage solution providers in order to achieve this. The market’s inability to offer unified solutions stems mostly from its failure to properly analyze and comprehend industry trends, causing market participants to eventually offer solutions that are typically unhelpful and inflexible.
Frost & Sullivan notes that the growth of IIoT has afforded several advantages to businesses worldwide, especially with regards to enabling access to more data and better insights. Predictably, some of the key factors that define today’s industrialized world include the ability to access a variety of sensor data, remotely monitor equipment, and predict the health of operational assets. This is especially true in the industrial sector, where companies are shifting their focus towards adopting preventive maintenance in order to reduce downtime and minimize abnormalities or defects in industrial equipment at an early stage. Using cloud-based equipment maintenance services to effectively perform continuous remote monitoring of industrial equipment also allows companies to assess and perform failure predictive diagnosis, use energy more efficiently, and enhance equipment performance.
However, Frost & Sullivan points out that one of the most common problems that companies face with IIoT solutions is cost. Unless the cost of the IIoT solution is significantly lower than that of the asset being monitored, IIoT monitoring does not provide a clear return on investment. Other challenges, chiefly with regards to handling the sheer size and speed of the data collected, includes effectively managing every device involved in the business process when it is online. In the industrial sector, timing is especially critical – and delays caused by bandwidth congestion or inefficiently routed data can cause serious problems and incur large losses worldwide.
The market requirement has steadily shifted over the past decade; while the ability to remotely monitor assets and predict asset failures has been the primary need, the current demand is a unified low-cost IIoT solution that can be quickly deployed. Unfortunately, most solutions in the market do not satisfy this. For example, a leading competitor provides $20 000 IIoT monitoring with predictive analytics capability based on machine learning. This system can be deployed on large critical pumps that cost hundreds of thousands of dollars, but it cannot be deployed on a small process pump that costs $5 000 (due to the lack of return on investment).
Pump manufacturers are industrial manufacturers that typically have no experience developing electronic hardware, software solutions, or cloud storage. Typically, most IIoT solution providers offer only one set of products or solutions, such as a data acquisition system, cloud storage, or data visualization. Pump manufacturers find it difficult to analyze the maze of available solutions and piece together their required solution. Moreover, to meet the needs of pump manufacturer, solution providers need expertise and experience in developing such solutions for the demanding needs of industrial application; these include the ability to handle a harsh working environment and meet stringent cybersecurity regulations.
By delivering unified solutions, leveraging best-in-class technologies, and harnessing expertise in standards and protocols, Frost & Sullivan believes that AMI Global has impressive potential to disrupt the market, earning this year the 2018 Frost & Sullivan Entrepreneurial Company of the Year Award.
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This is an excerpt from 2018 North American Integrated IIoT Solutions for Process Equipment Entrepreneurial Company of the Year Award Report that can be accessed here.