South Africa’s unique socioeconomic and business challenges are driving the local evolution of the Internet of Things (IoT), with companies increasingly reviewing the adoption of IoT as a strategic opportunity, telecommunications giant Vodafone’s latest IoT Barometer Report reveals.

The fourth edition of the yearly survey shows that IoT has steadily shifted into the heart of information technology (IT) strategies, with 90% of the South African companies and 76% of global companies surveyed considering IoT as critical for the future success of organisations.

“[South Africa’s] unique socioeconomic challenges are a key driver of the innovation and creativity which we see in many of the IoT solutions . . . deployed in this country,” Vodacom IoT managing executive Deon Liebenberg told media at a briefing, in Sandton, on Wednesday.

“Socioeconomic and business challenges are forcing local firms to be more creative than their global counterparts in developing IoT solutions. This is [one] reason why IT leaders see the adoption of IoT as being more critical for their future success.”

He cited cases of successful adoption of elements of IoT in South Africa, the maturity of which also led to the higher than global average confidence in local skills and security expertise to manage the rapidly emerging industry.

“The South African vehicle tracking market is a prime example and one which has developed into one of the most sophisticated industries in the world,” he said, adding that mobile-based health applications was another area where unique technologies were applied, including the Vodacom Stock Visibility Solution.

“M-health in South Africa has a very different context to m-health in developed economies owing to the societal challenges faced here,” Liebenberg explained.

The barometer shows that 88% of South African firms – compared with 79% of their global counterparts – believe that “real success and value” in implementing IoT comes with a significant price tag and lengthy time investments.

Despite this, the majority of local businesses are reviewing options to adopt IoT.

“When they do [adopt IoT], it is not out of experimentation, but rather because IoT is strategically important to them in terms of their sustainability,” he pointed out.

The IoT Barometer Report reveals that 46% of companies globally and 48% of South African companies plan to launch new connected solutions in the next 12 months.

South African companies also had more confidence than their global peers that employees have the requisite skills to manage IoT security and that the technology is sufficiently robust to process data safely.

Globally, 69% of companies said they had the processes in place to manage IoT security, compared with 86% locally, while 60% of companies globally believed that employees had the skills to manage IoT security, compared with 68% of South African respondents.

Further, only 65% of global firms thought their technology was robust enough to safely process data, while South African companies were more certain at 80%.

Overall, the survey found that 89% of companies globally had increased their IoT budgets over the past year, with businesses now spending 24% of the IT budget on IoT, ahead of mobile, cloud and analytics.

Sixty-three per cent of these IoT adopters are seeing “significant” returns on investment, which is up from 59% last year.

More than 50 of the 1 000 respondents were medium to large South African companies surveyed by Circle Research during April and May.