2020 IoT Outlook: Steady Growth, Skill Gaps, and Security Challenges

Each year, industry voices forecast a dramatic leap in IoT adoption, yet the reality has been a more measured, incremental rise. In many verticals, the early majority has already embraced IoT, and combined with maturing vendors and falling hardware costs, the stage is set for continued expansion.

"IoT is poised to have a breakout year in 2020," says Rob Mesirow, head of PwC’s Connected Solutions/IoT practice. "We’ve seen a noticeable uptick in awareness and demand across all sectors. Cost reductions in chips and sensors are creating new economics that make it easier for companies to invest and succeed.”

Mesirow points to retail as one of the most aggressive adopters, while anticipating significant gains in supply chain management, asset tracking, and enhanced employee and customer experiences. He notes that data intelligence from IoT services will become the new norm as we enter the next decade of connectivity.

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Supporting this view, Kenneth Research projects that the global IoT market will grow strongly next year, reaching a CAGR of 17.56% through 2023.

However, a persistent challenge remains: the skills shortage in key IoT end‑user segments. Terri Foudray, CEO of IoT‑focused firm RUMBLE, cautions that the shortage is a major barrier for 2020, as it has been in recent years. "Companies are trying to do things internally, using their ‘Smartest Guy’, and that isn’t delivering the expected ROI," she explains. Foudray cites the Vodafone IoT Barometer, which found that even sophisticated organizations with IoT projects rely heavily on third‑party support.

The vendor landscape continues to be confusing, with hundreds of IoT platforms and even more vendors. "Unlike other technologies, IoT requires many partnerships to succeed,” Foudray notes. "Each vendor offers a specialty that feeds into the IoT stack.”

Security remains uneven. "The industry is still relying on IT solutions to solve the IoT security conundrum,” she says. Introducing IoT devices to the far edge creates new attack surfaces, points of failure, non‑TCP/IP communication systems, and even physical vulnerabilities.

Edge computing faces similar hurdles. While interest in distributed computing is high, projects must navigate thermal limits, minimal power budgets, safety and security concerns, and real‑time networking requirements. Ted Speers, head of product planning for FPGA at Microchip Technology, highlighted these challenges at the RISC‑V Summit in San Jose.

Despite these obstacles, Foudray remains optimistic about the potential for IT and OT collaboration. "IT and OT will get closer to syncing,” she concludes. “Although we’ve seen some progress with IT and operations teams aligning, execution still needs work. IT/OT alignment is critical for advancing IoT, and companies will continue to bridge these historically diverse groups.”