Falling technology costs, government interest and developments in mobile and cloud computing have helped make the Internet of Things (IoT) finally become a reality.

That's according to a global report titled 'The Internet of Things Business Index: A quiet revolution gathers pace', which was conducted by The Economist Intelligence Unit (EIU) on behalf of chip designer ARM.

The report quizzed 779 senior executives from 19 industries on readiness for IoT, which centres around the idea that everyday objects embedded with sensors and chips can communicate with each other and feed back data over the internet.

High awareness

IoT is being discussed in the overwhelming majority (96%) of respondents' boardrooms, according to the report, and more than three in five (61%) of executives agree that companies slow to integrate IoT will fall behind the competition.

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It found that European businesses went the furthest in implementing IoT, ahead of the North America and Asia Pacific regions. Manufacturing is the leading industry in terms of IoT implementation (with a quarter of companies already having a live system in place), followed by construction and real estate.

Ian Ferguson, VP of Segment Marketing at ARM, told TRPro: "I think it's surprising that manufacturing and construction were ahead of IT, who you might expect to be out in front with this kind of thing, but IoT provides them with immediate wins in terms of cost saving.

IoT

"For example, deploying sensors to find out where leaking pipes or resources are, how loaded machines are and where trucks might be are examples of direct immediate ways to save money. The survey reflected that there's also an opportunity for IoT to create new services and improve customer service, but the latter is a little fluffier in terms of ROI."

Skill shortage

A lack of skills around IoT and employees with specialist knowledge were viewed as other barriers to IoT being more widely adopted. According to Ferguson, another lies around people in certain industries being "scared" of the technology.

He says: "For really broad deployment of IoT, it needs to be simple - it's still more of an assembly required type model - and some verticals are hesitant about the technology complexity. This should improve over time."

The report found that investment in IoT technology is mixed, with 29% of respondents having increased investment by 10% year-on-year, 39% having increased it by 39% year-on-year, and 32% having made no investment to date (or don't know).

Security concerns

Three in five survey respondents (60%) agreed that a lack of trust and concerns around data privacy are stalling consumer update of IoT. Ferguson says that it was "surprising" that security wasn't brought up more in the study.

He says: "I think it depends on how sensitive the data is, but there needs to be a level of security there even with relatively non-critical data, as you don't want fake claims of forest fires, etc.

"If you get into the secure grid, traffic lights or healthcare network, there are massive implications on security. It's certainly something we're worrying about a lot. It might be that manufactuing sees IoT as a closed network inside their factory, so that could explain one industry, but it's all in very early stages for others."