What the Infrastructure Bill Means for IoT


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The $1.2 trillion U.S. infrastructure bill recently signed into law is among the most consequential pieces of legislation in decades. The landmark legislation will shape spending on broadband, energy, transportation, water and more for years to come.

The legislation addresses crumbling U.S. infrastructure and the resulting huge gap with China and much of the rest of the developed world. According to a 2019 report from the World Economic Forum, U.S infrastructure ranks 13th among industrialized nations. Although the U.S. scores high on airport and road connectivity, it slips drastically behind in water and electricity infrastructure.

Much of the focus, so far, has been on the collapsing bridges and decaying water systemsthat blight many citizen’s daily lives. It has been more than half a century since the U.S. invested heavily in any major infrastructure project on the scale of the Eisenhower Interstate System, and 80-odd years since major public works investments under President Franklin Roosevelt’s New Deal.

Depression-era infrastructure remains operational, but must now be replaced. McKinsey researchers estimate the U.S. must invest $150 billion a year between now and 2030 just to keep up with the country’s current infrastructure needs.

[Source: UNPRI.org]

A highly visible aspect of the infrastructure legislation includes repairing and rebuilding bridges, roads, and other public amenities. But that’s not all.

For example, $65 billion has been earmarked for broadband grants aimed at improving Internet access in rural areas, for tribal communities, and for low-income families.

Beyond that, how much funding will be directed at Internet of Things infrastructure. Unsurprisingly, analysts aren’t sure how much will be spent specifically on IoT projects. IDC did offer predictions on which sectors will include IoT as part of larger infrastructure upgrades.

“The transportation, manufacturing, utility and energy sectors are all expected to see funding from the infrastructure bill,” Sandra Wendelken, IDC senior research analyst for mobile and IoT services, said in an email. “These sectors could implement a broad range of critical technologies, including IoT devices, platforms and connectivity.”

Also benefiting are high-speed mobile networks, edge and cloud computing and data analytics technologies that including AI and machine learning, Wendelken added.

Smart ports

ABI Research highlighted the nation’s ports as an area to watch. The market analyst predicts that IoT-based infrastructure upgrades will help resolve container ship stoppages that have contributed to supply chain disruptions.

“One area that I think is interesting to look at is the ports side specifically,” noted Tancred Taylor, an ABI IoT analyst. “There’s a lot of disparity in how well ports are equipped with new technologies, and this is part of the background that has led to the blockages both of the container ships at sea, as well as on the drayage and…port operations.”

Added Taylor: “Traditionally, ports haven’t had the resources to upgrade systems, or at least can’t do so without shutting down part of their capacity. The recent crisis is showing that they have been taking on more and more volume over the years without the required upgrades to their infrastructure and systems.”

Real-time visibility into transportation networks is another key area, including management of freight shipments. Taylor said open APIs and IoT infrastructure rather than traditional electronic data exchange could help track container ships and cargo status.

Real-time visibility software, of which IoT could support, also can help manage inbound and outbound deliveries. “Applications will vary a lot; it can be asset tracking devices, it can be other kinds of live feeds to a central digital control tower – which none but the biggest and most advanced ports currently have,” Taylor noted.

The Biden administration plans to spend $17 billion on upgrades at coastal and inland ports as well as ports of entry along the U.S. border. Administration sources told CNBC the port upgrades would start with the U.S. Army Corp of Engineers working on $4 billion worth of improvements. Those projects are expected to start within 60 days.

Bullish vendors

IoT vendors are naturally bullish about the U.S. infrastructure bill. Semtech, the analog and mixed-signal chipmaker, earlier stressed that passage of the American Rescue Plan Act of 2021 in March would allocate $50 billion to the Federal Emergency Management Agency’s disaster relief fund to help state, local, tribal, and territorial governments respond to natural disasters.

Marc Pegulu, Semtech’s vice president of IoT product marketing and strategy, said the company is assessing the infrastructure legislation’s impact on IoT-related markets. Pegulu agreed the legislation will spur investments in disaster recovery and untangling supply chain disruptions.

Another outcome of the spending bill will be accelerated IoT product development, Pegulu predicted.  “Industrywide, the average for the IoT design cycle is 12 to 18 months. We anticipate that this timeline will accelerate” thanks to infrastructure spending.

Christmas in July

Pending infrastructure projects that will require a great deal of IoT spending to implement. Initially, U.S. port upgrades will probably push IoT spending to new heights as the nation tries to ease the supply chain blockages affecting consumers. Little Johnny needs his PS5 in time for Christmas, and not arriving in mid-July!

 





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