Resources / Insights

December 12, 2016

Top 5 business reasons why the IoT needs fog computing

The IoT is a giant network of connected things:  Billions and billions of devices that stream terabytes of data between people and things, and things to things.

In many industries – discrete and process manufacturing, power and energy, utilities, connected cars, transportation, connected cities – IoT is propelling economic growth through new business models and more efficient, cost-effective operations.

Yet enabling IoT in any environment requires massive distributed networks that can handle operational efficiencies at zero downtime, ultra-low latency and enormous data loads from billions of streaming devices which require processing power that is closer in proximity to the “things.” The benefits of IoT have been well documented, but there are technical challenges in making it actually work in real-world scenarios.

Fog computing provides this missing link in IoT.

Fog computing fills the gap between the cloud network and things, by distributing computing and control, storage, and networking and communications functions closer to end-user devices.  This approach solves the bandwidth, latency and communications challenges associated with next-generation networks that will utilize IoT, 5G and artificial intelligence. Significantly, fog is emerging as a powerful architecture for extending cloud network services to the IoT in a way that we call the cloud-to-things continuum.

From a business perspective, here are the top 5 reasons why fog computing is the necessary architecture :

  1. Bottom-line impact. Fog adds immediate value to the business by enabling the acceleration of rollout cycles, reducing costs, and broadening revenue bases.  By solving bandwidth, latency and communications challenges, fog computing makes the production of revenue-generating products and services more efficient and therefore more cost-effective.
  2. New revenue streams. Because it creates value for IoT, fog computing will foster the development of long-awaited revenue-generating applications and services.  New revenue streams will come not just from IoT but also from Embedded AI and 5G.
  3. Shred and spread. The shred-and-spread nature of the fog architecture means that the business runs more efficiently and cost-effectively.  Because the architecture “shreds” across devices and “spreads” across clouds, fog provides highly functioning internal business services while expanding the overall scalability of the business.
  4. Common framework for collaboration.  Today, IoT teams are separated by the physical divisions between IT and OT and between cloud and premises.  Fog provides a common framework for collaboration and communication, enabling IT and OT business teams to work together and bringing cloud network capabilities closer in proximity to IoT.
  5. Leverage current IT investments.  With its cloud-to-things attributes, fog computing augments your investment in cloud networking and enables an efficient, cost-effective, and constructive use of IoT server technology going forward.  And by virtue of its standard-based building blocks, the fog architecture is designed to grow wherever the IoT market grows. Routers, switches, application servers and storage servers will converge into fog “nodes.”  Thanks to immersive distribution, each fog node will be capable of providing a common hardware and software platform that supports computing, networking, and storage – keeping pace with market growth and underscoring the value fog brings in terms of compute efficiency.


About the OpenFog Consortium

This blog represents the collective research and real-world work in fog computing of many of the 53 members of the OpenFog Consortium.  The OpenFog Consortium is a global nonprofit formed to accelerate the adoption of fog computing in order to solve the bandwidth, latency, communications and security challenges associated with IoT, 5G and artificial intelligence.  Our work is centered around creating a framework for efficient and reliable networks and intelligent endpoints combined with identifiable, secure, and privacy-friendly information flows in the Cloud-to-Things continuum based on open standard technologies.  For more information, please contact us at


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