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Top 7 IoT Challenges & Ways to Overcome Them

From choosing the wrong tech stack to failing to set up infrastructure properly, there are multiple IoT challenges that could bring your project to a halt. Here's how to navigate them like a pro.Jun 03, 2023

There are many ways IoT solution development can go wrong.

I mentioned some of the pitfalls every company eyeing the Internet of Things should be aware of in Your Ultimate Guide to Custom IoT Product Development, an article I wrote a little over a year ago.

In the past 12 months, Expanice has helped more businesses implement cyber-physical systems in corporate IT environments and launch novel IoT products.

And I felt the urge to elaborate on the issues you might face in the IoT development and deployment process, considering the experience our team has recently gained.

Without further ado, here are the top seven IoT challenges you should watch out for — alongside tips for navigating them like a pro.

Table of Contents

  1. Challenge #1: Proper IoT Infrastructure Setup, Operation, and Maintenance
    1. Unforeseen IoT Infrastructure Cost
    2. Accommodating for Ongoing Infrastructure Expenses
    3. Enabling Local Mode for Places with Poor Bandwidth
  2. Challenge #2: Designing Resilient IoT Infrastructures
    1. Setting up a Proper AWS Monitoring System
    2. Implementing a Safe Deployment System
    3. Boosting IoT Device Security
  3. Challenge #3: Creating IoT Products with Environmental Restrictions in Mind
  4. Challenge #4: Ensuring IoT Connector Durability
  5. Challenge #5: Navigating Scalability Challenges in IoT
  6. Challenge #6: Solving IoT Interoperability Challenges on the Protocol Level
  7. Challenge #7: Adhering to Industry-Specific Standards and Regulations

Top 7 IoT Challenges & How to Overcome Them

Challenge #1: Proper IoT Infrastructure Setup, Operation, and Maintenance

The Internet of Things infrastructure is an umbrella term that refers to on-premises and cloud servers where sensor data is stored and analyzed, as well as the accompanying software solutions and connectivity technologies. In some contexts, it can also denote your IT and customer service teams supporting a connected product’s functioning.

For this article’s purpose, we’ll focus on IoT challenges manifesting themselves in cloud environments.

Unforeseen IoT Infrastructure Cost

One of the primary challenges of implementing IoT is high infrastructure expenses.

Many organizations underestimate the cost of hosting and maintaining an IoT infrastructure, which can lead to budget overruns and performance issues. It is essential to take into account not only the hosting costs but also the data and request amount charged by cloud service providers like AWS.

To overcome this challenge, it is important to calculate the infrastructure cost accurately from the very beginning and plan for ongoing expenses. In one of our projects, for instance, we reduced AWS infrastructure costs by 66%. We’ve achieved this milestone by transferring the infrastructure to spot instances (AWS EC2) instead of ordinary ones, implementing an automatic deployment mechanism, and caching device status data through Amazon ElastiCache, thus reducing the amount of data traversing the network.

Accommodating for Ongoing Infrastructure Expenses

Developing an IoT monetization strategy that could sustain your product’s growth in the long run is one of the most daunting challenges in IoT projects.

Since IoT infrastructure is always present and requires ongoing maintenance and support, it is important to plan for a steady income stream from the outset. Failure to develop a sustainable revenue model can lead to cash flow problems and other financial issues.

One possible approach is to provide subscription-based services that bring ongoing value to customers. For example, a smart home system could offer a monthly service featuring continuous support and troubleshooting, as well as new functionality and updates as they become available. Alternatively, a business could charge a one-time fee for the installation and setup of an IoT system, followed by ongoing maintenance and support fees.

Enabling Local Mode for Places with Poor Bandwidth

Enabling local mode for environments with poor bandwidth is a sure-fire way to address IoT connectivity challenges

Ensuring that your IoT product stays connected and transmits status data 24/7 is key to the Internet of Things solution success. Sadly, few startups manage to navigate this IoT challenge.

During the pandemic, many users experienced poor internet connectivity due to the increased demand for online services. Unstable connections disrupt IoT solution performance — particularly if we talk about mission-critical applications, such as drones inspecting oil rigs or medical equipment monitoring patient conditions in real time.

To make sure your IoT product stays connected 24/7, it is essential to ideate IoT systems with a workaround or local mode for places with poor bandwidth or no internet connection at all.

For example, a home automation system could be designed to function in a local mode that does not require an internet connection. This would enable users to continue to control their devices in offline mode, while status data will be bulk-uploaded to cloud servers when the normal connection is restored.

Challenge #2: Designing Resilient IoT Infrastructures

As with any technology system, ensuring the stability and availability of an IoT solution is critical to its success. While it's impossible to predict and prevent all possible issues that may arise, there are a few steps your company could take to mitigate such IoT challenges.

Setting up a Proper AWS Monitoring System

One key aspect of ensuring the stability of an IoT deployment is having a robust monitoring system in place. This includes monitoring critical resources such as CPU usage, memory, and disk space, as well as tracking incoming data and request flow to detect any unexpected behavior.

For example, in one case we encountered, the request rate for a smart home solution suddenly spiked several-fold, despite no significant increase in the number of users. Through a detailed analysis of the request sources, we discovered that various connected devices were making an excessive number of server calls, which was significantly impacting the system's monthly billing.

To address this issue, we implemented the AWS device shadow approach, connecting devices to the cloud via a proxy info storage system that cached data and provided responses to the majority of requests. This helped reduce the number of requests being made to the system and improve its overall stability.

Implementing a Safe Deployment System

Another critical aspect of maintaining the stability of an IoT system is enabling a safe deployment process. This includes performing health checks, stress testing, and deploying to an intermediate server to test overall system stability before making a production deployment.

By doing so, you can help ensure that any bugs or other issues are caught and addressed before they impact end users. This can also help minimize the risk of downtime or data loss, as you can quickly roll back any changes that negatively impact system stability.

Boosting IoT Device Security

Due to the diversity of the Internet of Things ecosystem — and a lack of standards and regulations for connected device manufacturers — IoT security challenges remain one of the biggest hurdles on the way to at-scale IoT adoption.

As a company working on a connected product, you should realize that IoT security challenges are unique and may stem from any building block or layer comprising the Internet of Things architecture.

IoT challenges can reveal themselves at evert layer of a cyber-physical system

IoT architecture spans four key layers: end-user applications, software supporting IoT solutions functioning behind the scenes, networking technologies, and physical devices. IoT challenges, such as security vulnerabilities and scalability issues, can manifest themselves at any of these tiers.

From hard-coding simple device passwords to using weak data encryption technologies, there are many ways to compromise a cyber-physical system’s security. Fortunately, there’s a way to mitigate the lion’s share of these IoT challenges by implementing suitable data and network protocols, which secure sensor data on the way to the gateway and cloud and prevent unauthorized access to hardware and applications.

A real-life example illustrating the importance of IoT application security and data encryption is the infamous 2017 Las Vegas casino hack. Hackers were able to gain access to the casino's high-roller database through an internet-connected aquarium controller. The controller was not properly secured, allowing hackers to access the casino's network and steal valuable information. Another example comes from IBM whose hacking team discovered a security loophole in connected insulin pumps. The vulnerability could potentially allow hackers to alter medication dosage and tamper with sensor data, putting patients’ lives at risk.

Challenge #3: Creating IoT Products with Environmental Restrictions in Mind

One of the most important product design challenges in IoT is taking into account the environmental restrictions and surrounding conditions where connected solutions will operate. Temperature, wind, water, and other external factors can have a significant impact on the performance of cyber-physical systems.

One of our clients, for instance, wanted to create a connected cryotherapy chamber equipped with an array of sensors. Since the temperature of nitrogen circulating in the cryo unit drops as low as -270 ℉, the temperature sensors often iced up and stopped working, which prevented the system from taking accurate measurements. We navigated the issue by making insignificant changes to the cryo chamber design, moving the temperature sensor further from the valve on the nitrogen tank.

Such provisions should be made early in the product development lifecycle. And this is only possible if you start your project with a proof of concept followed by a discovery phase followed by thorough requirements elicitation. By analyzing functional and non-functional requirements, you’ll be able to rule out possible roadblocks early on, choose an alternative tech stack, and design the IoT solution architecture considering the unique environmental factors that might affect its performance.

Challenge #4: Ensuring IoT Connector Durability

One of the biggest IoT development and deployment challenges is keeping IoT devices connected. In the case of wired IoT systems, this is not possible without durable connectors — particularly, in the Internet of Things systems where devices are frequently moved or jostled.

For instance, we had a client who needed a system for monitoring the performance of heavy machinery in a manufacturing plant. We knew that the wired connections for the sensors would be subject to a lot of vibration and movement, so we partnered with experienced third-party hardware engineers to design custom connectors with extra durability so that the system could withstand these conditions. This attention to detail helped ensure the reliability of the system and prevented potential downtime for the manufacturing plant.

To improve the reliability and durability of IoT connectors, select connectors designed for frequent insertion/removal cycles, use reinforced connector housing and protective covers, minimize cable bending, and test the connected system rigorously. And if your internal IT team lacks hands-on experience working with hardware solutions, you can always enlist the help of skilled IoT consultants.

Challenge #5: Navigating Scalability Challenges in IoT

IoT scalability challenges are among the hardest to navigate - unless you analyze requirements for a connected product early on

Scalability constraints are among the top IoT challenges haunting the Internet of Things projects — especially those carried out by startups, who seldom have the resources and expertise to conduct thorough business analysis and make provisions for future growth.

In software development, scalability means the ability of a technology system to handle increased workload, user demand, and data volumes effectively and efficiently, without causing major performance glitches or incurring additional infrastructure costs.

I’ve already told you about the project where Expanice successfully leveraged spot instances and data caching to ensure the IoT solution availability while keeping the infrastructure costs down. Other means of improving IoT scalability include the microservices architecture, workload distribution, and auto-scaling.

But one method that I find particularly attractive is implementing device shadows.

Device shadows are a feature offered by AWS IoT that allows devices to synchronize and communicate with the cloud, even when the device is offline. It creates a virtual representation of the physical device in the cloud, allowing you to store and retrieve its last reported state. This is especially important for devices that are not always connected to the internet.

There are alternatives to device shadows that can provide similar benefits. For example, some customers prefer to use state machines to manage their devices, while others use time series databases to store device data. These alternatives can provide similar functionality, such as reducing cloud processing costs and improving device reliability.

One real-world example of solving the scalability challenges in IoT comes straight from the Expanice portfolio. Our client sought to monitor temperature and humidity levels in their warehouse. We implemented a solution using AWS IoT Core and device shadows, which allowed them to monitor their devices in real time and receive alerts when the temperature or humidity levels fell outside the desired range. As a result, they were able to optimize their warehouse environment, improve energy efficiency, and reduce costs.

Challenge #6: Solving IoT Interoperability Challenges on the Protocol Level

Currently, many connected systems use proprietary tech stacks and are not designed to talk to each other. And even though the situation has improved drastically in the past few years, the consumer IoT landscape is still flooded with standalone products that fail to function in unison, undermining the very concept of a global interconnected environment.

To solve IoT interoperability challenges, we recommend you make your product compatible with some existing communication protocols like HomeKit and Matter. This is particularly important if you’re working on a custom smart home solution — after all, your potential clients don’t want another home appliance that fails to exchange data with their existing device park.

The above-mentioned protocols ensure that devices from different manufacturers can communicate with each other seamlessly. Additionally, these protocols offer enhanced security features, such as end-to-end encryption and authentication, that can help protect the privacy and security of user data.

Challenge #7: Adhering to Industry-Specific Standards and Regulations

Again, we largely talk about data exchange and networking protocols here.

Let’s start with the communication technologies that can be used in all IoT deployments. These include MQTT, CoAP, and OPC UA, among others.

By incorporating these technologies into your product’s tech stack, you’ll make sure your product interfaces seamlessly with other devices and software systems available on the market.

Healthcare software solutions are among the most demanding IT systems in terms of compliance and regulations. Here’s where numerous application-specific data exchange technologies, such as HL7, HL7v2, HL7v3, and FHIR, come into play.

Let’s inspect these technologies a little closer:

  • Digital Imaging and Communications in Medicine (DICOM) is a protocol for exchanging medical images and information between devices and systems. DICOM includes security features such as encryption and authentication. Adhering to the DICOM standard is a must for connected diagnostic equipment, such as MRI scanners and X-ray machines.
  • Health Level 7 (HL7) is a set of standards for exchanging healthcare information between devices and systems — for instance, wearables used for patient identification and any other types of healthcare IoT solutions that interface with medical software, such as EHR systems. HL7 has two versions: HL7v2 and HL7v3.
  • HL7v2 supports the exchange of clinical and administrative data between healthcare providers. It includes security features such as authentication and access control.
  • HL7v3 is a newer version of HL7 that is designed to be more comprehensive and flexible than HL7v2. It uses a service-oriented architecture (SOA) and is intended to support a wider range of healthcare applications. By following HL7v2, healthcare systems can communicate with each other more effectively, which reduces errors, improves efficiency, and ensures that patient data is accurate and up-to-date.
  • Fast Healthcare Interoperability Resources (FHIR) is a newer communication standard for medical devices and systems. It is designed to be more lightweight and flexible than HL7 and tends to be easier to implement. FHIR allows developers to build applications that can interact with healthcare data more intuitively, using a RESTful API to exchange resources between different systems.

A failure to comply with industry-specific standards can result in extended product release cycles, performance issues, and restricted market opportunity. To select the right data exchange technology for your healthcare IoT solution, you must consider several factors. These include the tech stack of the systems the IoT product will interact with, your long-term scalability needs, the complexity and granularity of healthcare data, and the availability of resources and software tools you’ll need in the development process.

Summing It Up

As you can see, there are multiple IoT challenges you need to keep in mind when creating cyber-physical systems.

The good news is, you can successfully mitigate them by analyzing the functional and non-functional requirements for your solution early on. This can be achieved by kicking your project off with a discovery phase, creating a proof of concept, and adopting an iterative approach to product development while having a bigger picture in the back of your mind.

Development challenges in IoT also include the necessity to manage multiple teams responsible for hardware design, software development, and device manufacturing since few IT companies possess the resources and expertise to build connected solutions under one roof.

That’s why I recommend you contact an experienced IoT company that, in addition to creating certain components of your IoT product, can also help you keep project teams on the same page.