Despite achieving buzzword status over the past few years, the Internet of Things (IoT) continues to play a critical and ever-expanding role in today’s digitized, highly connected economies. But what exactly is IoT? How do developers create software for IoT and who are its major beneficiaries?

In this article, we’ll answer these questions and explore several typical IoT use cases and scenarios.

As its name implies, IoT consists of a network of “things” or physical devices, more often sensor-equipped, connected to the internet and accessible or managed remotely. Their purpose is to collect data about the environment or specific conditions and may operate independently or in conjunction with other devices. Along with telemetry, IoT is increasingly used in critical decision support at the edge—for example, machine learning (ML)-powered IoT cameras for detecting defects or packaging mistakes. This is because of the increasing power of embedded systems (more on that later) and ability of remote resource-constrained devices to do higher-order functions and decision-making.

These days, a myriad of commercial off-the-shelf (COTS) IoT solutions are available that enable organizations to quickly deploy IoT in their environments. Firms may also develop and implement customized software applications paired with commodity sensor hardware and low-cost microcontrollers (MCUs) for specialized use cases.

Interestingly, IoT use cases haven’t changed much since its inception over two decades ago, though consumers are increasingly adopting IoT in the form of wearables and home monitoring devices (e.g., Apple Watch and Nest Thermostat). That said, businesses are still the most fervent IoT adopters, with enterprises continuing to roll out IoT solutions across virtually all industries.

The following are just a few examples of industries being accelerated and digitally transformed by IoT.

IoT literally started in this industry, with Proctor & Gamble’s early connected RFID initiatives. Today, IoT is more prevalent in manufacturing than ever before, especially when it comes to predictive maintenance and anomaly detection. For example, IoT sensors enable the monitoring of discreet failure points in industrial machinery, surfacing minor issues for remediation before they result in operational disruptions, such as a stalled robot on the assembly line.

The future of autonomous transportation is contingent on the rollout of supporting IoT infrastructure. Notwithstanding, most vehicles today already integrate a staggering array of sensors for monitoring a myriad of parameters, from engine fluid levels and braking control to cabin temperature. Newer, non-autonomous driving systems leverage IoT for collecting and integrating these sensing points into a consolidated view of the vehicle’s condition and operational status.

Smart doorbells and thermostats are perhaps the most prominent types of IoT offerings in home use by today’s consumers. In the retail domain, IoT is powering autonomous or cashier-less payment systems, IoT-enabled automated guided vehicles (AGVs) for warehouse operations and smart advertising kiosks, to name a few.

RFID continues to play a critical function in IoT applications, especially when it comes to shipping and logistics. Smart container tracking technologies, maritime crew welfare and safety solutions (e.g., connected life vests and seafarer health monitoring devices) and hazardous cargo monitoring tools merge RFID with sensors to deliver unprecedented situational awareness and monitoring ability.

IoT is rapidly transforming industries through the digitization of manual processes—many that were previously unmonitored, unoptimized and undertaken by inefficient human counterparts. As for the latter, IoT improves employee safety through real-time monitoring of worker conditions (e.g., IoT sensors monitoring for hazardous compounds) and automatic accident detection systems (e.g., connected motion sensors for detecting falls or lack of motion). On the business front, IoT enables organizations to collect and correlate more data points, as well as derive new insights for driving business intelligence.

Despite its benefits, IoT may pose some challenges for organizations. Security, both digital and physical, is a critical concern, as IoT devices are expected to operate unattended for extended periods of time, often in remote locations, with little physical security. This makes them vulnerable to physical tampering, so IoT software development efforts should include features for physical security. For example, many custom IoT projects include tamper detection capabilities to verify that the device’s case hasn’t been opened.

IoT deployments can be complicated, so it’s important to ensure that the designed solution addresses the appropriate business or operational requirements. For this reason, many COTS offerings fall short, while custom-built solutions truly address the bespoke needs and requirements of the organization.