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What is the difference between IoT and IIoT?

27th June 2018
By Ben Westwood
Senior Consultant
Data Platforms

The emergence of the Internet-of-Things (IoT) is one of the major technological trends of our time and is shaping the current and future generation of internet applications.

The rising popularity of IoT is primarily due to the exponential increase in the number of internet-connected devices available. According to Gartner, 8.4 billion connected devices are in use in 2017, which represents a 31% rise from 2016.

The Industrial Internet-of-Things (IIoT) is considered a subcategory of IoT, the commonly understood difference between the two is that IoT refers to consumer devices such as wearables and the connected home while IIoT relates to business devices that usually improve safety and efficiency.

Sometimes this difference is called Consumer Internet of Things (CIoT) & Industrial Internet of Things (IIoT). Even though you’ll find most IoT experts and authors do not distinguish between CIoT and IIoT, this segmentation is becoming increasingly popular among market analysts and businesses.

For lack of confusion, I will be referring to Consumer Internet of Things as “CIoT” and Industrial Internet of Things as “IIoT” in this article.

Why we should distinguish IIoT from IoT

The reason we need to distinguish between these two segments is the increasing separation of their applications and growth rates.

The Industrial Internet of Things is expected to add a whopping $14.2 trillion (yes trillion) to the economy by 2030 mainly through productivity improvements. At the same time, there are signs that CIoT’s growth is lagging behind primarily due to a lack of standards stifling innovation and security concerns.

You may still be confused about what the difference is between IoT and IIoT. Below I highlight 5 differences between IoT from IIoT, which will help you understand the nuances and importance of why we should consider CIoT and IIoT devices as separate categories within IoT.

Device Use Case – Mass vs Niche

Wearables IoT

You’ll find CIoT devices are generally considered to be mass consumer devices such as smart home products, smartphones and wearables. Whereas, IIoT devices are usually more niche and specific to business industrial use cases such as smart machines, quality inspection sensors, vibration sensors and PLC devices.

However, while the type of devices is a very good differentiator, there are several cases where devices have both CIoT and IIoT applications. As a prominent example, consumer wearables devices are utilised for worker safety applications in industrial plants such as tracking how worker’s move around the site.

Another example is smart energy meters which you find in both energy plants and homes, as part of energy management applications (e.g. energy balancing and microgrids). Likewise, assistive robots are increasingly deployed in both consumer (e.g. cleaning) and industrial (e.g. warehouse picking) settings.

Therefore, we can consider the deployment of a specific type of device as indicative, but the use case of the device may not determine its classification as CIoT or IIoT.

Field Actuation – Closed Loop vs Human-in-the-Loop

IIoT Field Actuation Robot Arms

The vast majority of industrial applications involve some operation that changes the physical world. Device functions that change the operational rate of a machine, drive the behaviour of a robot or stop a conveyor are ubiquitous ingredients of IIoT applications in factories, warehouses and industrial plant floors.

IIoT applications generally involve cyber-physical systems (CPS) (e.g. industrial robots, adaptable workbenches), which comprise of physical parts that are driven by digital information. CPS systems are the foundation for closed-loop processes, which are not confined to analysing data from the physical world, but rather close the loop feeding back information to alter devices actions in the field.

Contrary to the majority of IIoT applications, most CIoT applications are focused on deriving knowledge based on the processing of data streams from heterogeneous sensors and devices, without necessarily closing the loop to the physical world. Many ambient assisted living applications are based on the user’s daily living activities and don’t influence each other without a human input element.

The latter knowledge is used to drive lifestyle recommendations, without necessarily interacting with the underlying devices. While this may not be true of all CIoT applications, IIoT applications generally manipulate the physical world much more than CIoT applications do.

Human vs System

Industrial IoT

CIoT use cases tend to be human-centric and consumer-facing. As such, they usually emphasise user profiling and the customisation of their functionalities to the user’s preferences and needs. Typical examples include smart home and ambient assisted living services, location-aware services in retail applications, as well as a wide range of services that involve users’ mobility.

On the other hand, IIoT use cases focus on physical systems and processes, which they try to automate and control in an intelligent way. As such, they emphasise on performance, scalability and their ability to operate in harsh environments.

Of course, there are several exceptions to this rule. As a prominent example, many industrial processes that involve human operators, which are conveniently characterised as “human-in-the-loop” processes. The deployment of IIoT in “human-in-the-loop” processes must take into account human factors as well (e.g., usability, ergonomics, personalisation) much in the same way these factors are addressed in CIoT applications.

Legacy & Migration 

Legacy & Migration Systems IIoT

The majority of CIoT applications do not depend on legacy devices. This is, for example, the case for mHealth and personalised healthcare applications, which rely on state-of-the-art smartwatches, smartphones and medical devices that are purchased and deployed from scratch.

On the contrary, IIoT applications need to take into account a large number of legacy machines and devices such as PLC (Programmable Logic Controllers), production machines and Distributed Control Systems (DCS), which are found in most industrial plants. These legacy devices fall in the realm of Operational Technology (OT), which does not provide digital interfaces to IT functions and services.

Therefore, significant effort is usually needed in order to transform legacy OT devices to Cyber-Physical Systems that expose interfaces for providing digital data and accepting commands from IT systems. Likewise, IIoT deployments are usually associated with challenging migration processes from the legacy systems to the IoT-based ones.

Power Efficiency & Communication

IoT Battery

CIoT and IIoT devices are deployed in radically different environments and hence exhibit very different power efficiency and communication requirements.

In particular, IIoT applications and devices are destined for harsh industrial environments such as factories, oil refineries, warehouses and energy plants. In these environments temperature, humidity and radio interference are usually high, which asks for more resilient communication protocols when compared to CIoT devices. Moreover, in these environments devices are not easily and frequently accessible to human workers such as plant workers and maintenance personnel.

While CIoT devices should also adhere to good power efficiency to prolong the battery life of portable devices, the requirement to do so is much lower as it is easy for users to re-charge and re-deploy them as needed. Similarly, CIoT devices usually work off of standardised communication technology such as Wi-Fi networks and Bluetooth, IIoT devices need communication systems that are not subject to interference and connection issues.


By considering these key differences it allows us to recognise how IIoT defines itself in the IoT space. While it is important to understand how IIoT and CIoT devices are different there are several cases where these differences become blurred.

This is why it is worth considering all these differences together as they can help us to identify when something should be considered an IIoT or CIoT application.

Currently, IIoT is driving IoT’s evolution and deployment as part of the fourth industrial revolution (Industry 4.0), which foresees the deployment of internet-connected devices and cyber-physical systems as part of industrial processes.

In particular, IoT’s value potential in industrial sectors like energy, manufacturing, oil & gas, mining and supply chain management is higher than in consumer-oriented applications. The main reason for this is that many IIoT use cases (e.g., flexible automation and predictive maintenance) have already a proven Return-on-Investment (ROI), while many CIoT use cases lack viable business models that would yield considerable ROI.

However, this could change in the medium term, as a result of the proliferation of consumer devices and the very high social impact of several CIoT applications such as their impact on public health budgets and the quality of life of the citizens. This is the reason why it’s important to monitor, understand, appreciate and fully leverage the value of both market segments.

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