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AI takes centerstage in industrial decision-making with IoT integration

Source: Eakrin/Buildings and Architecture via Adobe Stock.

The integration of artificial intelligence (AI) and the internet of things (IoT) in industrial environments is revolutionizing decision-making processes. As organizations increasingly adopt these technologies, they are experiencing significant advancements in operational efficiency, data analytics, and real-time decision-making capabilities. According to a study conducted by 451 Research, a part of S&P Global Market Intelligence, this trend is reshaping the industrial landscape and creating new opportunities for infrastructure vendors.

IoT adoption and maturity

The adoption of IoT technologies is progressing rapidly, with 56% of organizations represented in the study indicating that they have moved past the initial stages of IoT implementation, while 24% are in the discovery or proof-of-concept phases. Furthermore, 15% plan to implement IoT within the next two years, highlighting a strong trend toward widespread adoption.

Most organizations are in the mid-stage of their IoT projects, with 53% having formalized strategies, teams, and budgets, and significant deployments underway. Additionally, 30% are in the advanced stage, where projects are impacting operations and scaling, focusing on continual improvement. This distribution underscores the maturity of IoT adoption, as many organizations transition from initial experimentation to more structured and impactful implementations.

Key technology priorities

As IoT implementations mature, deploying supporting infrastructure at scale becomes crucial. Cloud infrastructure and IoT platforms are top deployment priorities, with 58% of organizations planning to deploy cloud and/or as-a-service infrastructure, and 55% intending to deploy IoT platforms and applications within the next 12 months. Generative AI and AI/ML are also significant priorities, with 52% and 49% of organizations, respectively, focusing on these advanced technologies.

Generative AI and AI/ML are among the most impactful IoT technologies, with 69% of organizations expecting generative AI to have a high impact on their IoT and OT initiatives, and 61% anticipating a high impact from AI/ML. Other crucial technologies include cloud and/or as-a-service infrastructure (57%), IoT platforms and applications (59%), and edge computing (54%).

Security and data processing considerations

Security, data privacy, and network availability are critical considerations influencing technology decisions. High network availability and greater speed are essential for 5G adoption, with 58% of organizations citing these factors as critical for deploying 5G. Enhanced network and data security features are also important, with 50% of organizations emphasizing these aspects.

Public cloud services are the primary venue for IoT data processing, with 49% of organizations initially storing and analyzing IoT data in centralized public cloud services. On-premises IT environments (46%) and public cloud edge zones (44%) are also common. Future trends indicate increased cloud and edge processing, with 50% of organizations expecting to use centralized public cloud services and 39% planning to use on-premises IT environments in the next two years.

The role of infrastructure vendors

The shift towards AI-driven industrial automation requires strategic decisions and management of IT-centric infrastructure from edge to cloud. Traditional IT infrastructure vendors, both alone and in partnership with OT vendors, must assist industrial customers in navigating this AI-heavy technology path. By emphasizing security and compliance, vendors can gain trust, limit risk, and capitalize on the growing opportunities in the industrial sector.

In conclusion, as AI and IoT technologies continue to transform industrial decision-making, organizations must prioritize scalable, flexible, and intelligent solutions to drive digital transformation. By aligning with these trends, vendors can meet evolving customer requirements and enhance operational outcomes.

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Published by Rich Karpinski

Rich Karpinski is Senior Research Analyst for the Voice of the Enterprise: Internet of Things (IoT) survey and advisory offering at 451 Research, a part of S&P Global Market Intelligence. In this capacity, Rich tracks, analyzes and anticipates the pace and direction of IoT adoption, overseeing 451's quarterly survey of IoT adopters and twice-annual survey of operations technology (OT) professionals. As a member of 451's IoT team, Rich also is responsible for smart city and smart spaces coverage. In addition to that role, Rich closely tracks the evolution of mobile operator business models – including IoT and other digital service strategies – and works with 451's mobile operator customers to help them understand market trends and plot strategies. Rich joined 451 Research in 2013 with the company's acquisition of mobility research firm Yankee Group. Before that, Karpinski was editor-in-chief of Connected Planet (formerly Telephony), where he led a staff in covering the service provider market. He has spent a career covering high-tech markets – both telecom and enterprise IT – for publications including Interactive Age, Communications Week, Information Week and Network Computing, working in marketing for supply chain software provider E2open and as an analyst for Net Market Makers. Karpinski holds a BA from the University of Illinois and an MS from Syracuse University.