IoT's Impact on the Data Center Industry

The largely untapped Internet of Things market could disrupt the data center industry in a positive fashion. A report filed by Gartner talks about the potential financial impacts of the blossoming industry mentioning, “The IoT will include 26 billion units installed by 2020, and by that time, IoT product and service suppliers will generate incremental revenue exceeding $300 billion, mostly in services.”

If you aren’t familiar with the Internet of Things, it can be simply described by devices that connect to the internet solely for the purpose of reporting data on a particular product. Think about how the new smart homes have the ability to give you a graphical view of your energy consumption on your smart phone in real time. This is considered an Internet of Things technology. Products found inside smart homes are an IoT niche within their own realm. The common factor with all IoT devices is that they need a backend in which to record and report data; this need is squarely addressed by the construction of new data centers.

With 11 figures of revenue at stake by 2020, industry power houses such as Microsoft, Amazon and Cisco have begun preparing solutions for the impending IoT revolution. Inside of Microsoft Azure, users are able to setup Machine Learning. Microsoft’s Machine Learning service allows organizations to actually use the data acquired from an IoT sensor and translate that data into an algorithm that can provide insight into a particular device.

As the world of IoT matures, the services offered by cloud providers will mature as well. These services will offer organizations the ability to do sophisticated tasks with their newly acquired data. Microsoft’s Machine Learning capabilities and other competing products barely scratch the surface as to what the future holds for the Internet of Things.

As more devices become internet connected, the need for data centers in strategic geographical locations becomes more immediate. When you break down Gartner’s prediction of 26 billion IoT devices in use by 2020, think about the fact that there may be around 7 billion people on earth at that time. When doing the math, it seems as if there be 3.5 IoT devices in use per 1 person by 2020. That’s an incredible ratio to consider.

A report by Dell says that the IoT market will require data centers of all different sizes based on the actual IoT device and its usage. Dell goes on to mention that smaller data centers will be better equipped to deal with more time sensitive data procured by IoT devices. Specialized data centers will likely need to be built out within proximity of the IoT devices in order to process and report fresh data. Data center professionals believe that the IoT market could accelerate the need for these specialized local data centers all though out the world should an IoT-based product line up take off internationally.