Governments and enterprises worldwide are rolling out plans to develop the Internet of Things (IoT). For example, many countries have policies designed to accelerate the growth of smart cities by building engagement on IoT technology between cities and between countries. For governments, it's all too obvious that the IoT is a vital new growth engine that will deliver a significant boost in growth and trade.
What's less obvious, or at least less quantifiable, is the sheer scale of the economic impact that the IoT will have. According to consulting institute McKinsey, the impact could be as large as a staggering US$11 trillion by 2025, equivalent to 11% of the world economy.
Huawei forecasts that by 2025, there will be 100 billion connected IoT devices, used in every area of business and life. There will be a time when, for example, your refrigerator is able to sense its content, and generate a shopping list to your mobile phone. As you drive past the restaurants you regularly patronize, your phone will automatically grab the vouchers and offers they are broadcasting – and find you a parking space in real time. Your car will continuously collect and analyse data on your driving habits, which will help insurance companies to set premiums at just the right level. In a world of connected things, limitless possibilities lie everywhere.
All things sensing, all things connected: The IoT offers enormous opportunities which all farsighted policymakers are striving to grasp.
Facing up to the challenges
The IoT has the potential to significantly raise levels of efficiency and drive digital transformation in companies. However, challenges abound:
Standards: There are a number of different IoT architectures used in different industries, meaning that the IoT as a whole is still fragmented and not well scaled. The industry is exploring how to integrate the various different IoT standards to reduce barriers to entry.
Connection parameters and security: Depending on the use case, each industry places a different emphasis on the type of IoT connection it requires. Some specify the breadth and depth of coverage; for some it is low-power devices, or low latency. Given the range of IoT technologies available, how does an industry select the right type of IoT and integrate it into commercial operations? How can total security be maintained?
Monetization: Any new technology ultimately has to serve business objectives. Every industry needs to consider how it can leverage the IoT and develop digital services to drive new growth.
Industry and ecosystem development: The IoT is a complex ecosystem. The supply chain behind any IoT system is long, involving multiple manufacturers, integrators, operators, and customers. How do you build wide-ranging alliances to knit partners into stable, sustainable business models in which all parties can succeed? How do you protect the interests of everyone and grow together? These questions are of crucial importance for the commercial application and the sustainable growth of the IoT.
Everything starts with connectivity
From planning to deployment, commercial use, and expansion, companies will need to make significant investments of time and capital in the Internet of Things. To ensure a satisfactory return on their investments, companies will have to set clear goals based on their business strategy. Then their IoT journey can truly begin.
The start is often the hardest part, but a simple three-step process can be applied:
Step 1: Build connections, gather data. Connectivity is the foundation of IoT. Connections vary in type and match different scenarios. When deciding on which type of connection, companies need to have a forward-looking strategy in mind; they need a connection that's stable, secure, and scalable – and, of course, at the optimum cost. For instance, with smart parking, remote metering, and smart homes, as well as a myriad of industrial and manufacturing scenarios that have massive data transmission requirements, it is important to build connections that ensure low latency, wide coverage, and low power consumption. This is where Narrowband IoT (NB-IoT) comes into play.
Step 2: Analyse data to create value. The value of the IoT goes far beyond data gathering and real-time monitoring. Companies will increasingly see the need to upload their big data to the cloud, to support flexible resource scheduling and visualized operations. They will also look into processing their data using machine learning and cognitive analytics in order to develop the new services that will bring them success. Looking forward, IoT platforms that are open, deployed on the cloud, and with big data analytics capabilities will be the ones to watch.
Step 3: Explore new value for new business models. Riding the wave of digitization, there will be a gradual shift from specialized verticals to open industry. We will see traditional industry blend with digital, one sector link to another, and downstream loop back into upstream. Companies will jointly explore and hatch entire new business models and commercial applications. In this process, it will be important for companies to bring an open and long-term perspective to their selection of an IoT partner. They will need stable, win-win relationships to secure success in the IoT.
Real action: Developing the IoT industry
Huawei is a global leader in information and communications technology, with three decades of experience, and it has the capability to deliver full-stack IoT solutions, from chipsets to operating systems, from IoT connections and platform to cloud computing and big data analytics, and even ecosystem development. Huawei is well positioned to provide industry customers and partners with seamless, full-stack services and experiences.
Huawei is also committed to respecting the boundaries and specialisms of its customers. There are five areas into which Huawei does not venture: customer data; industry-specific IoT applications; IoT device development; IoT device resale; and end-to-end integration services for enterprise customers.
IoT chipsets: With its strong expertise in telecommunication, Huawei has developed a high-performance IoT chipset called Boudica. Boudica is highly integrated and low power, and perfectly designed to support large NB-IoT deployments.
IoT operating system: To help promote the development of smart devices, Huawei offers a lightweight, open source IoT operating system – Huawei LiteOS.
Diversified and secure connections: Huawei enables wired connections (agile IoT gateways, home IoT gateways, and edge computing IoT) and wireless connections (NB-IoT, 5G, eLTE, etc.) in order to serve different scenarios. It also provides end-to-end security solutions.
Cloud-based IoT platform: Huawei has built an open, cloud-based IoT platform – Huawei OceanConnect IoT Platform – which supports cloud deployment and all types of connections, ensuring greater reliability and efficiency. The platform also comes with big data analytics tools to help customers to generate extra value from their data.
Standards and ecosystem: Huawei has developed a network of more than 700 IoT partners in a wide range of industries, including smart home, smart manufacturing, smart energy, and Internet of Vehicles, etc. Huawei hopes to share its rich experience of industry applications with its IoT ecosystem partners, so that all parties can grow and succeed together.
As of the end of 2016, Huawei belongs to over 300 standards organizations, industry alliances, and open source communities, including the NB-IoT Forum, the Alliance for the Internet of Things Innovation (AIOTI), and Industrial Internet Consortium (IIC). Huawei's objective is to help produce mature industry standards sooner, and lower barriers to entry for IoT solution providers.
For solution partners and developers, Huawei launched the "IoT Solution Partner Program". This program offers support for the design, development, integration, certification, and marketing of IoT solutions. Huawei will provide US$1 billion in funds to support developers in its developer community. In addition, Huawei has established 13 IoT Open Labs to provide worldwide IoT partners with open lab services, including joint innovation, validation services, and joint marketing.
Business cases
“Internet of Elevators” helps Schindler cut costs, enhance safety and experience
Operating more than one million elevators and escalators globally, the Swiss-based Schindler Group is one of the world's leading providers of elevators, escalators, and related services. In the past, Schindler's elevators were mainly operated and maintained manually, resulting in high maintenance costs and inherent safety risks in the event of human error or negligence.
Now, Huawei is working with its partners to provide Schindler with an industry-leading Internet of Elevators solution. The solution will manage over a million elevators around the world on a single platform, automate operations and maintenance, and help Schindler overcome safety challenges.
Huawei's industrial predictive maintenance solution collects and transmits elevator data in real time to reduce the need for physical inspections. Using sophisticated data analytics on the cloud, it is possible to identify potential issues and send an alert in advance of a likely elevator malfunction. The solution helps reduce downtime by 90%, and maintenance costs by 50%.
Predictive maintenance not only eliminates safety risks, it also extends elevator service life. The solution also allows for new services, such as in-elevator advertising and innovative digital services for data monetization, which can create additional commercial value.
Smart Water Solution helps keep drinking water safe
Sending utility staff to homes to read water meters in the traditional way has a variety of problems. It is costly, and sometimes meters are missed by mistake. More importantly, the traditional method does nothing to record water losses from pipes, which is a waste of resources and a cost. Incomplete measurements in China suggest that 37% of all mains water is lost through leaking pipes.
In March 2017, Huawei partnered with Shenzhen Water Group and China Telecom to launch the world's first commercial smart water network. Huawei deployed more than 1,200 NB-IoT-enabled smart water meters in Shenzhen as part of a comprehensive upgrade of the city's water management system. It was a complicated deployment, one requiring broad coverage across the entire city, plus physical depth of coverage, because the water meters are mostly located on underground inlets or in basements. However, the NB-IoT smart water meters provide exactly the functionality required. The meters use very little power because they stay in sleep mode except during the occasional meter readings. This means less maintenance and longer between battery replacements.
Smart water meters not only help save on the cost of labor involved in meter reading, they can also improve data completeness and accuracy. To date, the utility is getting data from over 99.5% of its meters every reading. The meters are also able to check water pressure, and compare throughput at different nodes of the pipe network, which enables the company to identify leaks and carry out preventive maintenance before problems escalate. Smart meters also enable differentiated rates at peak/non-peak times of day, helping the utility to smooth demand and use its water resources more efficiently.
AOD Smart Street Lighting saves energy and costs
Advanced Optronic Devices (AOD) is the world's largest manufacturer of LED street lights. Its LED lights are designed for outdoor, commercial, and industrial use. Huawei partnered with AOD to deploy a smart street light solution in Weifang, a city located in China's Shandong province.
The smart street light solution uses Narrowband-IoT (NB-IoT) over licensed spectrum, which offers excellent coverage and reliability. It allows for precise control, down to the brightness of each individual light, with options to program lighting patterns based on the season, weather, or other specific need. LED lighting already delivers power savings of 50% over traditional street lights; the smart lighting solution enables a further 10%–20% improvement in power efficiency.
The smart street light solution also supports remote fault detection and troubleshooting, thereby eliminating the need for visual inspections. Combined with lifecycle management based on the age of each street light, remote monitoring can reduce maintenance costs by about 50%.
Looking ahead, Huawei will continue to increase its investment in the IoT. Alongside its partners, Huawei will help the IoT industry flourish.