Over the past 35 years, my company has earned a reputation as a manufacturer of highly reliable communications hardware that is easily, and cost effectively integrated with other devices and systems. These qualities have also made Moxa a popular choice for companies with Industrial Internet of Things (IIoT) and digitalization initiatives, giving the company a front-row seat to developing trends. This article describes three IIoT gateway and digitalization trends we are currently seeing and responding to.
1. Increased compute requirements at the edge
A major trend going into 2024 is the demand for greater compute power at the edge. This is particularly noticeable among users that have had initial success with IIoT and digitalization:
- Many users that were the most active and successful with IIoT also encountered some form of sticker shock at the costs of bringing data to the cloud, especially if they are paying for both the long term evolution (LTE) connection and the cloud service/platform itself.
- Popular edge software platforms and operating systems have also grown more CPU intensive over time, with older versions reaching end of life and losing support for updates and security patches.
- This past year, artificial intelligence (AI) has taken tremendous strides in becoming mainstream and accessible, and industrial users are actively exploring how to implement it at the edge in a commercially viable manner.
The expenses from metered connections and recurring fees add up quickly, and we are having a lot of discussions with customers that now want to handle more of the data processing at the edge rather than in the cloud.
Running the latest approved operating system and software often requires an upgrade in the hardware as well.
The edge compute devices that have powered successful digitalization projects present a natural entry point for forward-thinking users that are exploring this next frontier.
We anticipate significant ongoing development in this area as CPU and graphics processing unit (GPU) options converge and lower the barrier to entry.
2. Fiscal concerns over platform control and support
We are also seeing casualties in the IIoT space as organizations grow less patient in waiting for tangible returns on their investment. Many IIoT startups have folded or pivoted because they were unable to find a sustainable business model, resulting in additional collateral damage to users that have had to quickly migrate to other solutions or build their own. With the IIoT hype cycle appearing to have run its course, companies are entering 2024 with a much more conservative mindset and heightened focus on fiscal sustainability:
- There is growing demand for industrial users to have direct control of their digitalization platform and data, whether to save costs on expensive name-brand solutions with high vendor lock-in, or to mitigate against the risks of a vendor discontinuing support for a platform.
- We are also seeing initially successful IIoT organizations reaching the limit of what is possible with their in-house teams as they start to reach a certain scale.
Some users are opting to build the platform themselves, while others are carefully selecting proven and cost-effective providers that have already proven themselves at scale, such as Ignition.
Using an internal team to build, provision, and maintain custom IIoT gateway hardware is becoming a bottleneck to growth, so these users are exploring options for achieving scale by migrating to off-the-shelf hardware.
3. Growth in IT collaboration and cybersecurity awareness
In the past year, we have seen information technology (IT) departments more deeply and openly involved in IIoT and digitalization initiatives, sometimes through the creation of a separate division specifically to support operational technology (OT) users. It’s fair to say that in years past, it was not uncommon for prospective IIoT users to actively avoid involving IT, but there is now a growing acceptance of IT’s indispensable role in supporting a company or customer’s digitalization infrastructure. A more open and productive conversation between OT and IT is leading to greater maturity in the path to digitalization.
Companies are carefully establishing guidelines for internal business units that are pursuing digitalization projects and are learning how to specify approved vendors and solutions. We are also seeing more productive discussions around managing cybersecurity, and there is an appreciation for vendors that are able to participate in these discussions in a meaningful way. Familiarity and compliance with international sourcing and IEC 62443-4-2 guidelines does a lot to reassure industrial users of a vendor’s legitimacy and ability to support their digitalization efforts over the long run.
The industry is rapidly maturing
As we navigate the evolving IIoT and digitalization landscape, it’s clear that the industry is maturing rapidly. Trends such as increased edge computing power, greater attention to fiscal responsibility, and deeper collaboration between OT and IT departments are reshaping the way organizations approach their digital transformation journeys.
At Moxa, we remain committed to providing reliable, cost-effective solutions that empower our customers to leverage the latest technologies while maintaining control over their platforms and data. As we move forward into 2024 and beyond, we eagerly anticipate continued innovation and adaptation to meet the evolving needs of the industrial landscape. This feature originally appeared in the March edition of AUTOMATION 2024: IIoT and Digital Transformation.
