Last updated: 15 January 2022
IoT systems and their interdependent building blocks can be various and complex.
However, an IoT ecosystem is typically built up with 7 distinct essential components.
- Chapter 1 will cover the basics of an industry-grade Internet of Things ecosystem architecture and its key layers.
- We'll move to the business ecosystem from the IoT technical ecosystem and list the major consortia and alliances shaping business and technologies. That's chapter 2.
- In the third part of the page, we'll also give an overview of the legal IoT ecosystem and briefly mention the latest IoT regulations in the EU, UK, and the USA. It's changing. You should know about it.
So, if you're looking for a global picture of the IoT ecosystem in 2022 and understand how it may impact your projects, you've come to the right place.
Let's get started.
The 7 components of an IoT ecosystem architecture
We know the feeling.
Navigating the IoT market can be difficult. The perceived barriers to entry when launching a new project seem countless.
Challenges can be more easily understood and overcome by identifying what building blocks IoT service providers need to consider when creating a proof of concept (POC).
So, an IoT ecosystem architecture is generally formed from a set of components which can be simplified into the following:
#1. Sensors in the IoT device
One starts with the sensors, which capture the data one wishes to send back.
The sensors themselves are simple enough. They could take temperature and humidity and measure pressure. That's self-explanatory.
Sensors capture electric pulse or primary analogue data sources. They can measure temperature, humidity, light, motion, acceleration, smoke, chemical particles, and pressure.
Sensors detect, and actuators act. Actuators will operate in the reverse direction. When triggered by the application, they take action. Electric switches, valves, and motors are actuators.
#2. Device connectivity
The sensors are connected to a device or a part of the device.
And the device itself has an element that allows it to connect to the network to transmit data to the cloud and receive commands.
The network could be Wi-Fi, the network could be cellular, and it could be a lot of technologies.
But more about this later.
Wireless access equipment includes cellular IoT modules, IoT terminals, cellular dongles, cellular gateways, or routers.
When the connection is cellular, a SIM card or eSIM is also required as part of the wireless access equipment hardware.
#3. Application in the smart device
On the device itself – and it's the third functional block of IoT systems– is an application. That's the logic that says, for example, "if the temperature exceeds 20 degrees, I send a notification to the network."
Or the logic might say, "I set to send temperature every one minute," so that's the application, the third building block, on the device.
But then, that's where the complexity starts.
The first set of jargon is in the smart device.
You need to have the application that's running. The application runs on a processor. That's called either an MCU, a multi-controller unit or an MPU multi-processor unit.
#4. The network
The fourth IoT layer is the network itself that connects from the device back to the cloud.
This device connects to the network. The network could be Wi-Fi, it could be Bluetooth, and the network could be cellular.
Let's focus on the cellular because many IoT applications are based on it for reliability and service levels.
And in cellular, you've got a host of options based on the bandwidth you want for your application or the battery.
The acronyms you would come across would be the usual 2G, 3G, 4G, and 5G of cellular.
As of 1 January 2023, Thales cellular IoT products business is part of Telit-Cinterion. You can find the relevant information on the Telit-Cinterion website
But within 4G – which is mainstream of IoT today – there are two broad categories.
- The LPWAN, a low-powered wide-area network, has two variants: category M (Cat-M or LTE-M) and category NB-IoT (Cat NB-IoT).
- Then you've got the mid-range bandwidth, category LTE-1 (LTE Cat 1).
And then, the high bandwidth applications typically use networks called LTE Advanced (LTE-A) or LTE Advanced Pro.
And very soon, with the advent of 5G, a whole new set of acronyms will come up.
There's something called massive IoT, an extension in the 5G world of the CAT-M and CAT NB we spoke about in 4G LTE environments.
Something that will be brand new on networks is called Ultra-Reliable Low Latency Communication (URLLC). This is for IoT applications that need extremely low latency between the generated data and its availability in the cloud.
So that's the kind of acronyms one will encounter along the way, and the type of technology one will have on the network itself.
#5. The application (and processing) on the cloud
We are coming over to the cloud.
Now that the data comes back, it's stored in a database. It is treated/processed. There are actions taken on it. That's sitting in the cloud.
This part is a typical IT application.
A gigantic step to aid M2M in evolving into IoT is the emergence of public cloud platforms specially tuned for IoT applications. Platforms such as AWS
IoT from Amazon, Google Cloud
, or Azure
from Microsoft have vastly simplified IoT and offered a common structure, including security and device management. They have also eased the standardization of the structure of messages sent from the edge device.
#6 Data Analytics
The one thing that would be different out there, though, more in IoT than in enterprise applications, is machine learning or analytics - some people call it AI (Artificial Intelligence).
This is really different for IoT because the value in IoT is in the data generated and the results that derive from analyzing the data leveraging virtual data analytics.
So, this is something that will specifically come across the analytic side.
More often, that's running in the cloud, the sixth functional layer of the IoT ecosystem.
Big data analytics can benefit the IoT-enabled smart grid, where millions of data are collected and stored.
There's a seventh IoT pillar that underlies all of this.
And that's a security building block: the security at the device, the security at the cloud, and the channel between the device and the cloud.
Security is a broad concept that needs to be adapted to the use case.
But the general security principles established in IoT and the acronyms used are PKI, public-key cryptography, encryption, mutual authentication, and certificates.
Device Management and security: How do you know how your wireless system performs? How do you push software updates to the device? How do you manage security? These supervisory functions are the role of a device management platform, a sort of IoT monitoring system for your IoT system.
Therefore, an IoT ecosystem has different elements to consider, each with a fair amount of interdependence on the other building blocks.