Business

Exploring business opportunities in IoT

Internet of Things (IoT) is one of the emerging technologies yet to be fully embraced in Nigeria despite its huge economic potential. ABOLAJI ADEBAYO examines the missing business opportunities along value chains embedded in the technology

 

Globally, technology has become the bedrock of socio-economic development and growth. Apart from enhancing productivity in other sectors, technology has continued to generate huge revenue for governments. Indeed, technology has been growing to be the major source of revenue for some countries as both government and private sectors explore the economic value chains in the sector.

 

In Nigeria, technology, though still evolving, has greatly helped economic growth. While the country is yet to develop many aspects of technology, it has banked on Information and Communications Technology (ICT), while concentrating on telecommunications, to grow the economy.

 

The telecommunications sector is said to have contributed more percentage to the Gross Domestic Product (GDP) of the country. It was reported that the percentage is the largest contributed by the nonoil sector compared to other sectors of the economy, including agriculture and manufacturing. NCC’s Executive Vice Chairman, Professor Umar Garba Danbatta, said ICT sector has been consistently contributing above 10 per cent of Nigeria’s GDP for over 10 years, stating that as of the 4th quarter of 2020, the telecoms sector alone contributed 12.45 per cent to GDP.

 

He stated that the sector is expected to contribute 35 per cent to GDP in 2025. Recent data released by the Nigerian Bureau of Statistics (NBS) disclosed that ICT sector contributes 16.20 per cent to Nigeria’s GDP in the first quarter of 2022. According to the data, the sector, in the first quarter of 2022, recorded a growth rate of 12.07 per cent in real terms, year-on-year.

 

The NBS data revealed that the nonoil sector comprising economic activities in information and communication, agriculture, mining and Quarrying, manufacturing and education, among others – in real terms – posted a 93.37 per cent contribution to the nation’s GDP in the first quarter of 2022. However, industry experts believe that there are still many untapped economic potentials and business opportunities to grow the small and medium enterprises in the relatively new IoT technology. IoT tech “Desk in an office miles away. Our refrigerator alerts us to buy milk on the way home.

 

A package of cookies on the  busisupermarket shelf suggests that we buy it, based on past purchases. The cookies themselves are on the shelf because of a ‘smart’ supply chain. When we get home, the thermostat has already adjusted the temperature so that it’s toasty or bracing, whichever we prefer. This is the Internet of Things – a networked world of connected devices, objects, and people,” Samuel Greengard,” an ICT expert explained. He described IoT as an emerging world and how it will change the way people live and work, noting that Internet of Things (IoT) is still in its early stage.

 

“Smart phones, cloud computing, Radio-Frequency Identification (RFID) technology, sensors and miniaturisation are converging to make possible a new generation of embedded and immersive technology,” he added. According to the Chief Executive & Technology Officer, Datamello, Wale Adedeji, IoT is a serverless internet technology that connects everything, saying everything is being moved to the cloud ecosystem.

 

He noted that the new technology uses devices to help individuals, industries and business owners to maximise costs. He said cloud computing has become mainstream, dominating the market across developed countries.

 

“The Internet of Things describes physical objects with sensors, processing ability, software and other technologies that connect and exchange data with other devices and systems over the Internet or other communications networks.”

Helping businesses

 

Adedejo noted that deployment of IoT reduces input costs for industries and business organisations.

 

According to him, anybody using IoT has cut out the cost for servers as all their instruments are connected to the cloud. He noted that the organisation pays little for the space it buys on the cloud. A tech expert, Taofik Mustapha, said Internet helps the business to obtain data and analyses the information to create better and more effective products, marketing plans before investing money in product development, adding that it helps businesses to test and collect the data behind the idea of products and services.

 

Speaking on the importance of the new technology, he said: “IoT helps  businesses reduce costs. IoT solutions streamline existing processes across manufacturing, supply chain, production and other industries. Streamlined operations minimise downtime and decrease costs.

 

The manufacturing industry is the best example of cost reduction via IoT technology. “IoT is all about the enhancement of business processes and solutions with sensors, devices, gateways and platforms. By gathering all their data in one place, manufacturers can make intelligent decisions and design more efficient processes.” Internet of Things helps businesses across industries.

It is said that IoT facilitates tech interaction to promote digital transformation. In recent years, IoT adoption has skyrocketed in almost all industries in developed countries. The IoT market is expected to cross over $1300 billion globally by 2026, while it is projected to generate $4-11 trillion in economic value during the same period. Market research revealed that IoT has opened up new avenues for growth and optimisation.

 

It was gathered that 83 per cent of the organisations that implemented IoT technology has improved their efficiency. The research indicates that 80 per cent of manufacturing companies are planning to invest in IoT, while another 90 per cent of retailers are planning to use the Internet of Things to customize the in-store experience.

 

Recognising the numerous benefits of this technology, the business world is increasingly investing in IoT technology. It is said that data is the new oil. “With IoT technology, your business can use every data point to achieve growth goals and optimize processes. Here are some of the ways IoT can benefit your business: IoT helps businesses reduce costs; IoT solutions streamline existing processes across manufacturing, supply chain, production, and other industries.

 

Streamlined operations minimise downtime and decrease costs. “Factories use predictive maintenance technology to reduce downtime by up to 20 to 50 per cent and save 10 per cent in maintenance costs. “IoT boosts productivity and profitability. IoT tech is helping businesses gather and analyze more data for a better customer experience.”

Business opportunities

 

The Datamellon boss noted that the new technology can create more busisupermarket  nesses to grow the Nigerian economy if enabling environment is created by government and supported by favorable policies. He stated that creating businesses using IoT systems requires a combination of many key factors, saying technologies such as sensors and connectivity are key to creating a useable network of data.

 

He said, however, that application and an effective data center infrastructure are also key. Adedeji said there is a dearth of experts in Nigeria to promote the technology. He told New Telegraph that his company is hiring youths to be trained for the deployment of IoT technology in Nigeria. Adedeji noted that there are employment and business opportunities in the sector, which is undergoing development in Nigeria.

 

“For the technology to spread across the country and for its benefit, we need experts and trained people for its deployment and that is why we are employing youths who are ready to develop themselves in the technology to make their livings.

 

They don’t need to be experts, we are going to train them.” Noting that the adoption of cloud computing is still growing, as more and more businesses migrate to a cloud solution, he said cloud computing has become mainstream, with major Amazon Web Services (AWS), deploying the tech in Nigeria.

 

Value chains

 

Apart from helping other businesses to grow, the Datamellon CEO said there are various businesses, especially the small and medium enterprises, that could be created along the value chains of IoT. For instance, he said the infrastructures used is a big business for those who would be making them available, especially in Nigeria.

 

According to him, IoT unearths new business opportunities, stating that 36 per cent of businesses discover new opportunities with IoT. With IoT, he noted that businesses build new product lines and revenue models based on emerging patterns.

 

“For example, insurers calculate premiums based on driving habits. Retailers plan their inventory levels and in-store display by recording consumer behavior. Marketers use IoT-based beacon tech to gather insights about consumers. Data analysis helps businesses adapt to change and create market-ready products.”

 

Last line

 

While still rearing its head in the Nigerian market, technology experts said there are huge economic potentials in IoT technology yet to be harnessed.

 

The President, National Association of Telecoms Subscribers (NATCOMS), Chief Adeolu Ogunbanjo, who also believed that the technology has huge potential for economic growth, said government is crippling the sector with high and various degrees of taxes.

 

According to him, investors are not interested in setting up tech businesses in Nigeria due to taxes, nothing that the sector is overtaxed. Ogunbanjo, who advocated exploration of other aspects of the telecoms sector, urged the Federal Government and the regulatory body to make the environment friendly for the technology to thrive in the country. He said noted that the deployment of IoT would further enhance the economy of the nation.

 

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