The IoT can be understood as the global connection of sensors and other devices to a hosted service and/or each other. However, this leaves a lot of room for interpretation and application. To make matters possibly more confusing, the Internet of Things is also known by another name: Industry 4.0. This term illustrates a change in the way machines can be utilized.
Here is the history behind the “4.0” part: Just as software increments a version number with each major release, industry has undergone major changes throughout recent history.

Industry 1.0 – There was a major influence on industry when James Watt invented the Watt steam engine. He introduced the concept of a separate condenser and rotary motion to the Newcomen steam engine, meaning a machine could now be harnessed to provide power for many different tasks that had previously needed to be accomplished by humans. A basic unit of power, the Watt, was named after him.
Industry 2.0 – Henry Ford originated the idea of a moving assembly line and the mass production of automobiles.
Industry 3.0 – Computerization of records, then calculations, diagnostics and operations.
Industry 4.0 – Cyber and the Industrial Internet of Things. Now, machines are not only performing tasks, but also controlling one another and amassing data between themselves. In cases where deemed necessary, this occurs with no human intervention.
Although the advancement of technology has inspired dire predictions of gloom and doom—from the uprising of machines, to a singular super computer taking over the world and mankind (as seen in “The Matrix” and “Terminator”), this is not realistic (at least not in the foreseeable future). Rather, the Internet of Things has a goal of being able to collect sensor data from various sources, with the additional goal of making intelligent decisions based on the data. A simple example, which is actually in use today, is the use of a large network of sensors on a farm to collect the moisture and mineral content of the soil. Water is dispersed only where and when it is needed. Fertilization is customized to soil conditions and spread only where it is required. This type of technology usage will become more widespread as it increases efficiency and profitability.
According to SAP Systems, a provider of digital systems: The Internet of Things is not merely a step along the path to digital transformation; it is the driving force. By 2025, the IoT’s economic impact could reach $11 trillion, or 11% of global economic value, and by 2030 the IoT could influence nearly the entire economy.
How did we get here? In the past 10 years, sensor costs have lowered to less than half of what they were, bandwidth (the ability to send data) costs are 1/40th of what they were and the cost of processing all that data has plummeted to 1/60th of what it was. This has created a perfect storm of technology to make this costeffective and easy to implement. Many companies are spending massive amounts of money, time and resources to implement the IoT on, and for, their equipment.
Although the Internet has been in existence for a while, the Internet of Things is relatively new. Total worldwide spending on the IoT is predicted to reach $1.29 trillion by 2020. That represents a compound annual growth rate of 15.6 percent over the 2015-2020 forecast period!
Much of that will go toward hardware (the largest spending category throughout the forecast), followed by services, software and connectivity. Hardware spending is estimated to approach $400 billion by 2020, the bulk of which is represented by modules and sensors that connect endpoints to networks.
But there is more to the IoT than sensors. These sensors need to be connected to the Internet in some way. Many of these sensors will be selfpowered through batteries and wireless protocols such as Zigbee®, Bluetooth® and even Wi-Fi. The data will then be collected and, after the data is analyzed, there will be decisions made to control the systems that are being monitored. However, the latest concern is in the security of these systems that are connected to the Internet.
