Defining & Understanding IIoT

As the name suggests, the Industrial Internet of Things (IIoT) refers to the application of IoT technologies within industrial environments. While it shares many features with consumer IoT - such as smart sensors, actuators, smart switches, and wireless connectivity - the crucial difference lies in their purpose.

Consumer IoT devices, like smart home products or wearables, are generally designed to enhance the daily lives of individual users by creating more convenient or efficient environments. These networks are typically beneficial rather than critical.

In contrast, IIoT networks are engineered for automation, efficiency, and the prevention of emergencies or hazardous situations. By connecting machines and devices across industries such as utilities, agriculture, and oil, IIoT applications move beyond user-centric convenience to prioritise safety, resilience, and proactive operational responses.

IIoT networks exchange large volumes of data, so reliable wireless connectivity is essential. In the past, cellular networks often lacked the bandwidth needed to transfer these volumes efficiently. With the emergence of 5G, devices can now send and receive data seamlessly, with reduced latency and lower power consumption.

IIoT sensors may either be built directly into machinery or added to existing equipment through IoT gateway devices. These sensors can detect issues such as pressure levels or temperature in real time and transmit the information instantaneously, either for further analysis or immediate action. Some IoT devices are even capable of performing the required actions themselves - for example, smart switchgear that can instantly trip circuit breakers to isolate a faulted section or automatically reroute the power supply as necessary.

With advancements in AI and machine learning, IIoT data can now be analysed far faster and with greater accuracy than human capability allows. This enables organisations to identify opportunities to improve performance, management, and energy usage. As AI develops the ability to handle increasingly complex datasets, it could also uncover new opportunities for cost savings while providing deeper insights into evolving customer needs.

The real-time sharing of data gathered by IIoT devices allows businesses to respond to unexpected situations with speed and decisiveness. Equipment can be monitored continuously, and immediate action can be taken when an issue is flagged, rather than waiting until it escalates and disrupts operations.

IIoT devices also reduce blind spots in large warehouses and inventories, enabling real-time inventory assessments and ensuring staff and customers have access to accurate information.

In the workplace, IoT safety devices can help mitigate injuries. For example, wearable sensors can monitor an employee's vital signs while they carry out hazardous tasks. In the event of an accident, these sensors can automatically send out a notification to signal that the employee requires assistance.

The biggest risks and challenges associated with IIoT lie in security. Many devices do not encrypt data, and some continue to use default passwords even after deployment, leaving them vulnerable to potential attacks.

Another challenge is ensuring firmware remains up to date. Organisations need to frequently check for and deploy necessary updates, while also ensuring these do not disrupt business operations.

As with any device, IIoT products may vary in their security protocols, so it is important to assess them individually. In recent years, greater emphasis has been placed on security, and many newer devices now use multifactor authentication or end-to-end encryption.

In addition, a number of regulations and standards have been introduced regarding IIoT devices and networks. Enforcing compliance is essential for proper IIoT usage. These include the European Union Cybersecurity Act, ISO/IEC TS 30149:2024, and many others that vary by country and region.

IIoT devices are becoming more sophisticated and continue to deliver greater value across industries undergoing digital transformation. As technologies such as AI, edge computing, and 5G mature, the capabilities of IIoT will expand even further - enabling faster, smarter, and more cost-effective solutions. This ongoing evolution will not only strengthen operational efficiency and resilience but also redefine how industries respond to challenges in real time.

For a deeper exploration of these themes, our latest White Paper, authored by CIO Peter Hellberg, examines how IoT and OMS are reshaping the future of electricity distribution. It is available on our website in the ‘News Room’ section.