1 IoT Fundamentals: Definitions, Architectures, Challenges, and Promises
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1.5.1 Component Supplier: Component Business
While a complete IoT solution comprises the whole IoT stack, IoT components
relate to one or at maximum three layers of the IoT stack. A company could focus
on selling such IoT components to complete IoT solution providers who intend to
build and release complete IoT solutions. Let us examine each layer of the IoT value
stack and their corresponding stakeholders using a connected electric bike (e-bike)
example [25]:
• Physical Object – The physical object (i.e., e-bike) provides the initial direct
benefit for the user. As with traditional bicycles, the e-bike provides an ecofriendly, healthy mode of transportation while also enabling motorized cycling.
• Embedded System – In this layer, the physical thing is equipped with a processing
unit (e.g., a microcontroller), a connectivity module (e.g., 3G, 4G, NB-IoT),
sensors, and actuating components to become smart. These pieces operate locally
by gathering data and providing localized benefits. In our example, sensors
are responsible for monitoring battery status or sensing when motorization is
required. An example of an embedded system provider is Bosch which designs
and provides several IoT sensors for years.
• Connectivity – In this layer the smart object and its functions/status (e.g.,
battery status) can be accessed online globally with the help of network
providers/operators. Moreover, new services could be added to the system e.g.,
online location monitoring or theft prevention. In many IoT solutions such as ebike, we can use SIM cards and mobile networks to be connected to the Internet.
Indeed, already in the first quarter of 2016 in the United States, 69% of newly
activated SIM cards were related to non-phone devices, like cars, dog collars,
etc. Thus, all major mobile network operators aim at selling SIM cards as IoT
components.
• Platform (Cloud) – Platforms are one of the central foundations of IoT as
they unite connectivity, service providers, applications, and embedded systems
to create specialized IoT solutions for diverse industries. Platform providers
offer data ingestion, data storage, data analytics, data visualization, device/user
management, and integration with other third parties through SDK or APIs. In
our e-bike IoT solution, this layer enables one to track the movement patterns of
e-bike users, study the difficulty levels of specific cycling routes to understand
motorized support demand better, or discover the location of stolen e-bikes in
real time. An example of the platform layer could be Amazon. With Amazon
Web Services (AWS), the company has been successful in the cloud computing
business. Indeed, Amazon is now offering an IoT component (i.e., AWS) that can
be used to build IoT solutions.
• Application (Service) – This final layer combines the options and features
provided by the prior layers to structure digital services. Users can receive
digital services in appropriate formats that are independent of location via mobile
applications or web tool. In our example, this feature enables customers to find
e-bikes in the case of theft or provides pertinent location information to law
enforcement.
39
1.5.1 Component Supplier: Component Business
While a complete IoT solution comprises the whole IoT stack, IoT components
relate to one or at maximum three layers of the IoT stack. A company could focus
on selling such IoT components to complete IoT solution providers who intend to
build and release complete IoT solutions. Let us examine each layer of the IoT value
stack and their corresponding stakeholders using a connected electric bike (e-bike)
example [25]:
• Physical Object – The physical object (i.e., e-bike) provides the initial direct
benefit for the user. As with traditional bicycles, the e-bike provides an ecofriendly, healthy mode of transportation while also enabling motorized cycling.
• Embedded System – In this layer, the physical thing is equipped with a processing
unit (e.g., a microcontroller), a connectivity module (e.g., 3G, 4G, NB-IoT),
sensors, and actuating components to become smart. These pieces operate locally
by gathering data and providing localized benefits. In our example, sensors
are responsible for monitoring battery status or sensing when motorization is
required. An example of an embedded system provider is Bosch which designs
and provides several IoT sensors for years.
• Connectivity – In this layer the smart object and its functions/status (e.g.,
battery status) can be accessed online globally with the help of network
providers/operators. Moreover, new services could be added to the system e.g.,
online location monitoring or theft prevention. In many IoT solutions such as ebike, we can use SIM cards and mobile networks to be connected to the Internet.
Indeed, already in the first quarter of 2016 in the United States, 69% of newly
activated SIM cards were related to non-phone devices, like cars, dog collars,
etc. Thus, all major mobile network operators aim at selling SIM cards as IoT
components.
• Platform (Cloud) – Platforms are one of the central foundations of IoT as
they unite connectivity, service providers, applications, and embedded systems
to create specialized IoT solutions for diverse industries. Platform providers
offer data ingestion, data storage, data analytics, data visualization, device/user
management, and integration with other third parties through SDK or APIs. In
our e-bike IoT solution, this layer enables one to track the movement patterns of
e-bike users, study the difficulty levels of specific cycling routes to understand
motorized support demand better, or discover the location of stolen e-bikes in
real time. An example of the platform layer could be Amazon. With Amazon
Web Services (AWS), the company has been successful in the cloud computing
business. Indeed, Amazon is now offering an IoT component (i.e., AWS) that can
be used to build IoT solutions.
• Application (Service) – This final layer combines the options and features
provided by the prior layers to structure digital services. Users can receive
digital services in appropriate formats that are independent of location via mobile
applications or web tool. In our example, this feature enables customers to find
e-bikes in the case of theft or provides pertinent location information to law
enforcement.