Europe surges ahead in IoT
All indications are that 2018 will see the Internet of Things (IoT) take big steps forward in Europe.
First, European companies and governments are prioritizing IoT investment more than their counterparts elsewhere—notably the USA. A recent survey by Bain & Co. found that more European executives plan to deploy IoT solutions over the next few years than their colleagues in other regions. 27% of European corporate leaders said they are implementing or have already implemented use cases to produce high value IoT analytics, compared with 18% of U.S. executives. A much larger portion of European executives than American are planning by 2020 to have moved past prototyping to integrating multiple use case IoT solutions into their core technology environments.
The same survey found key European industries are devoting a larger share of their IT budgets to IoT than their counterparts in the US. For example, automotive executives are allocating 24% of their IT budgets to IoT, compared with 19% in the US. In retail, industrial and construction, the relative IoT spend is also higher in Europe.
Another example of aggressive European development: European tech companies are competing to acquire IoT capabilities. Observers estimate that Siemens has spent more than 8 billion Euros on IoT-related acquisitions, including electronic design software developer Mentor Graphics, whose advanced IoT design capabilities will help Siemens enhance end-to-end information flow from design through manufacturing.
A further driver of IoT in Europe: it’s seen as a way to extend European companies’ lead in international reputation for highest quality industrial goods and services, particularly in such strongholds as automotive, machinery and construction. IoT promises to reinforce traditionally strong European manufacturing disciplines such as robotics and 3-D printing. Along with monitoring manufacturing processes and activity at every phase of production and triggering real-time adjustments, IoT gathers data on product performance in the field that can drive design improvement. Meanwhile sensors capture data on usage and wear, so companies managing service contracts can enhance predictive maintenance.
Finally, the EU regulatory regime’s single framework for managing IoT data privacy and security may prove to be an advantage. A European Commission effort is under way to develop a single set of rules to ensure that Internet-connected IoT devices share many of the security protections in place for computers and mobile devices. Many observers believe that European companies will benefit from their greater experience cooperating on security and data issues.
To be sure, IoT is also racing ahead in the U.S. and Asia. But for now it appears that Europe is more than holding its own in implementing this technology, which promises to be genuinely transformative to business and society.
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