It’s no surprise that companies implementing dynamic IoT solutions are doing so by harnessing the power of cloud computing. However, it may surprise you how cloud computing is benefitting these IoT initiatives. When referring to the cloud, many talk about its scalability, cost-effectiveness, and low maintenance, yet the cloud has so much more to offer than that.

When deciding how cloud computing might impact your IoT efforts, consider these surprising benefits.

• #1 The cloud facilitates data integration.

For years, enterprises have invested in big data initiatives, combining information from multiple sources to help their business make quicker, more accurate decisions. Most of these efforts have been focused on human-generated data stored in ERP, CRM, and other enterprise systems. These systems alone can generate a lot of data, and changes across a company (such as a merger or acquisition), can create a whole new set of data sources that need to come together for unified visibility.

To further complicate things, companies began adopting IoT as part of their data strategy to provide real-time information to these existing reporting systems, more context in terms of how the business is operating, and greater visibility into areas of the business that were not previously possible. For some companies, this is an opportunity to increase operational efficiency and streamline costs. For others, it can unlock new business models and revenue streams.

Now that data from traditional enterprise systems are layered in with data generated from sensors and connected equipment, companies are finding that IoT data has different characteristics than traditional enterprise data. The velocity and volume of this kind of data can overwhelm systems that are not prepared for it. It also requires some rearchitecting of data models because it represents different types of information that may not have been part of prior planning.

This is where cloud computing comes in. Because of the cloud’s ability to house large amounts of data, companies can process and store both data from their enterprise systems and their IoT devices in the same place. The cloud becomes a great aggregation point for all disparate systems, where companies can scale their efforts up or down with very few limitations. Organizations can then eliminate the need for integration and audits between systems that crop up when their data is stored separately.

• #2 Companies can count on the cloud for security and reliability.

In the past, industrial companies have questioned the protection of the cloud because they viewed it as losing the ability to touch and feel their data. Much like consumers who were reluctant to move their savings from under their mattress into a bank account, many businesses have held similar reservations about where to put their data. As a result, these companies have rejected cloud computing in favor of on-premise technology.

While there are still many people out there who view security in the cloud as a concern, actions from the leading cloud providers have started to sway these opinions. While most companies have a dedicated security professional (or several), cloud vendors like Microsoft and Amazon have hundreds. These massive security teams also follow best practices and industry-specific standards and obtain proper certifications out of obligation. Vendors also equip businesses using their cloud solutions with the tools they need to take ownership of the security of their data.

Those looking to include a cloud solution as part of their IoT deployments can count on its security too. As the security of the cloud itself is proven further, it also allows companies to more efficiently and securely interacts with their IoT devices. As you will see in greater detail below, the cloud is an essential component of any large-scale IoT initiative, so a comfortable and secure connection between data generation points is key.

On a similar note, cloud platforms undergo continuous auditing so that cloud service providers can make performance and security data readily available to customers. This data access helps businesses ensure proper security and performance across fleets of IoT devices. With the realization that cloud providers are putting substantial resources towards security, along with the undeniable benefits the cloud offers, companies have increasingly begun to view cloud solutions as a trusted and even preferred approach.

• #3 When paired with edge computing, the cloud offers the most significant business benefit.

Treating cloud and edge separately is a fairly standard business practice. But for all the essential workflows that the cloud enables, there are still advantages to integrating edge computing into a solution. Both cloud and edge offer different benefits in different types of environments, which often makes a distributed computing framework best suited for IoT deployments. Having differentiating services can involve different layers to compute at the edge – or the point where data is generated.

For example, consider a large factory with hundreds of pieces of equipment – each of which is effectively an edge endpoint, while the factory itself could represent another endpoint. In a deployment of this size, it would make sense to take the data generated from the equipment and aggregate it on the factory floor before sending it to the cloud.

Inserting this intermediate layer becomes critical because it reduces the number of direct connections and allows for filtering of information traveling into the cloud, which prevents unnecessary data from cluttering downstream analysis. Furthermore, if this factory only used cloud computing, they wouldn’t be able to react fast enough to the data generated on the equipment.

Delays stemming from data overload, as well as the distance between endpoint and analysis, slow response times, which can make a huge difference in both safety and quality scenarios. Including edge in computing, the framework allows businesses to extract insights and act faster than if the data had to travel to the cloud and back. This time-savings opens the door for real-time evaluation of data right on the equipment itself.

On the flip side, if the factory opted for an edge-only approach, they would lack the ability to get a full view of their operation. Without the cloud, they would only have on-site visibility into each piece of equipment individually, with no insight into how those endpoints were operating in relation to each other. To get this level of analytics, the factory would have to implement offline batch processing, and manually combine all the factory data.

In a surprise move, cloud vendors have begun moving toward offering some on-premise solutions to complement their cloud solutions. For example, Amazon has launched two products that are dedicated to edge computing: AWS IoT Greengrass, which offers an edge computing environment for larger devices, and Amazon FreeRTOS, which offers edge computing for microprocessors and microcontrollers. Microsoft has also rolled out comparable products, including Azure IoT Edge and Azure Sphere.

No matter the situation, distributed processing and selecting the right solution for your operation are key elements of a successful IoT initiative. Often, it’s a multi-tiered approach that uses different methods of computing based on strengths and weaknesses. Organizations that perform analytics both at the edge and in the cloud can see much more significant results, such as minimized costs and maximized performance.

Shifting views of the cloud will lead to greater IoT success.

As the cloud becomes more widely adopted across industries, a shift to multi-cloud environments will begin to gain momentum. Much like when companies stopped asking the question, “Windows or Linux?” The same paradigm is moving to the cloud. People who were pledging their allegiance to AWS or Azure, have now realized that different cloud providers have different strengths and that a more cohesive strategy is finding a way to glue them all together in a way that makes things seamless.

As the cloud landscape shifts, the IoT landscape changes too. More devices are introduced every day, creating a greater need for device management and tighter security. The cloud offers key benefits that help businesses implement IoT initiatives more effectively in industrial environments.

When utilized effectively and paired with edge computing, organizations are better able to match their computing to their business needs and act on insights in real-time. And making faster, more accurate decisions based on live operational data can create real business value and increase ROI.

Dave McCarthy

VP of IoT Solutions

Dave McCarthy is a leading authority on industrial IoT. As VP of IoT Solutions at Bsquare Corporation, he advises Fortune 1000 customers on how to integrate device and sensor data with their enterprise systems to improve business outcomes. Dave regularly speaks at technology conferences around the globe and recently delivered the keynote presentation at Internet of Things North America.