A Comprehensive Guideline to IoT Hardware and Its Place in the IoT Ecosystem

The Internet of Things has dramatically facilitated humans’ lives, creating a vast ecosystem of remotely controllable devices. At the same time, progress doesn’t stand still and the global IoT market is expected to grow to 24.1 billion devices in 2030, generating $1.5 trillion in annual revenue.

IoT is literally making everything around us smart, powering up every aspect of life with data, AI algorithms, and networks. Something very simple and complicated at the same time like detecting when your coffee machine is running out of Arabica beans and placing a new order with the preferred provider is now possible thanks to the interrelation of IoT hardware solutions, software, and wireless connectivity. When looking at the successful rolling out of any IoT solution, it all starts, but of course not ends, with the hardware.

1. The Place of Hardware in the IoT Ecosystem

The range of constituent parts that form fully-fledged IoT solutions is growing at lightning speed, and it’s essential to divide them into separate layers.  Let’s go through the five major IoT layers or constituents that revolve around valuable data extracted from hardware and delivered to the cloud.


Device (Hardware) is a physical element of the IoT ecosystem that plays a crucial role in collecting and transmitting data through the whole ecosystem that can be used to derive insights and improve decision-making. There’s a wide range of IoT hardware, from chipsets, sensors, and modules, to wearable electronic devices and smartphones. Some of them may work alone, while others function as a part or additional solution for an existand device.

With the multitude of chipsets and modules available, selecting the right IoT hardware for a project can be overwhelming. There is always a balance between technology size and performance. Higher-end devices can employ more advanced chipsets in their design (e.g, manufacturers like Qualcomm, Sony, and Sequans), while battery-powered devices have strict power consumption limits that necessitate the use of low-power wireless technologies. Additionally, more sophisticated technology becomes more affordable when integrated into embedded designs, especially when the product is produced in large quantities

Sensor Data

The next layer of the ecosystem is the sensor data collected from sensors, and set controls and managed by device software. The goal of sensor data in the IoT ecosystem is to enable more intelligent decision-making and improve overall performance and productivity. If referring specifically to embedded operating systems, it’s lightweight and optimized for hardware platforms, which can result in better performance and energy efficiency. We’re talking about embedded OSes, such as Amazon FreeRTOS, TinyOS, Windows 10 IoT Core, etc.

Data Transport

This is the process of sending data back and forth between a sensor and the cloud.  IoT has many different elements, such as Physical and Data Link, including access technologies (LPWA), or IEEE 802.15.4-based technologies such as Zigbee. Apart from the connectivity, there are network elements, such as IP, dealing with the way data packets are routed. Data can be transmitted using a variety of transport protocols, such as TCP, UDP, MQTT, CoAP, and others depending on the specific requirements of the IoT application.

Cloud Data

The cloud data layer refers to data aggregation, monitoring device estates, analysis, maintenance, and efficiency improvement. IoT like many other areas within tech, is going through prevailing ‘platformisation’ with the aim to easily build and utilize IoT apps for the devices. Here we talk about device management and data management platforms,  for instance, Amazon IoT Core, Google IoT Core, Microsoft Azure IoT Hub, etc.


This layer implies creating value from data by making it available, intelligent, smart, and actionable. This is completed by device manufacturers’ platforms, apps, third parties solutions, and cloud hyperscalers.  Among the most prominent examples are Application Enablement Platforms and Connectivity Support Platforms, such as AWS IoT Core.

2. Major IoT Hardware Types and Key Players

Covering a diverse pool of devices such as humidity sensors, wearable electronic devices, or basic devices like smartphones, IoT hardware performs multiple functions: system launch and security, action specifications, communication, and detection of support-specific goals and actions. Let’s go through the major types of  IoT hardware:

IoT Sensors

IoT Sensors are a kind of ‘skin’ in IoT that detect environmental changes and collect data.  Among the key modules they comprise are the sensing, energy modules, RF, and power management modules.  We can single out two types of sensors: active (utilizing their own energy to collect real-time data like X-ray or GPS); passive (using external energy like cameras). It’s also important to distinguish among sensors according to their position, velocity, pressure, flow, light, and radiation. 


Processors, such as microcontrollers or microcomputers, are the ‘heart’ of the IoT system. These devices work with the raw data gathered by sensors and draw out the most valuable information. 

IoT Gateway

IoT Gateway is a device (sometimes a software program) that connects the cloud and controllers and sensor nodes with WWW. In his way, all the data from the IoT device passes through the IoT gateway to get to the cloud. 

Wearable Electronic Devices

Wearable Electronic Devices are worn by millions of people on their feet, neck, arms, and other body parts. Wristwatches, glasses, backpacks, and even socks. IoT hardware has arrived almost everywhere.

Basic Devices

Let’s not ignore the devices we all use every single day, such as mobile phones, tablets, desktops, remotes, or routers.

Additional IoT Modules

Hardware that can turn existing devices that are not powered with IoT technology into smart devices. A large part of the market is made up of IoT cellular modules, which are expected to reach double-digit growth in 2021. Below you can find the list of top cellular IoT module vendors available in the market. 

In terms of key cellular IoT device players, Quectel, Fibocom, and Sunsea AIoT achieved exceptional growth in the last several years, along with more fast-developing vendors on the horizon.

The Internet of Things is constantly developing and expanding into new areas, with more and more devices being connected to wide area networks based on cellular or LPWA technologies. The number of potential items that can become networked is unpredictable, while the cost of connectivity is decreasing.

LPWA technologies bring more opportunities in the areas such as energy meters, motor vehicles, and buildings. Approximately 3.3 billion utility meters enable consumption-based billing as the revenue base for the electricity, gas, and water industries, while more than 1.4 billion motor vehicles transport people and goods globally.

Hundreds of millions of buildings give housing and workspace to over eight billion humans. And these are large markets, where device categories range even more. For more information go through the top IoT target segments below:

3. What’s the Difference between IoT Hardware vs IoT Software?

IoT hardware entails a number of elements and devices that together enable connectivity, such as gateways, sensors, communication protocols, etc. On the contrary, IoT software is carrying out specific programs and tasks on the hardware, assuring that all the data is processed and analyzed properly. Here’s a simple comparison of IoT hardware and software:

IoT devices communicate in a variety of ways via specific protocols depending on what they are, what other devices and systems they need to message, and what exactly they need to say. There is no single protocol to track it from the beginning to the very end, and the major difference is specifically in these languages, where connectivity itself is a glue between the device and the cloud.

The unified mission of hardware, software, and connectivity is to deliver data from point A to point B. 1NCE provides network access with global coverage and 500-megabyte data. Using 1NCE OS software or another platform, you can define which data is being sent and which protocol is used. At this stage, intelligence apps like the Device Locator or the Energy Saver can be used as well. 

To deliver data from the device directly to the cloud, MQTT, and HTTPS are usually used, while 1NCE OS acts as a translator offering UDP, CoAP, and lightweight M2M. It’s well suited for constrained devices and translates all of that into protocols that are more suitable for the cloud world, e.g., HTTP or HTTPS. There are some traps that can emerge when using different kinds of protocols with NB-IoT, which can be found in our article first published by Embedded Computing Design, entitled How MQTT on Narrowband-IoT Can Ruin Your Project - Embedded Computing Design.

4. What Type of Connectivity Can Power Up Your Hardware?

Depending on the business, budget, quantity of products, and power consumption, the choice of an IoT connectivity option varies. In this way, it’s better to make a list of requirements from the offered solution, for instance:

  • Speed. Make sure you choose a connectivity network that can deal with the amount of data your devices will send and acquire.

  • Coverage. The distance between the devices matters, so the network must offer an adequate range.

  • Power Consumed. Battery or wired? Do you have reduced bandwidth requirements? Weigh these factors and keep up with IoT innovations.

Furthermore, IoT connectivity is represented by two categories - wireless and wired solutions, which are divided into long-range and short-range connectivity standards.

5. How to Reduce IoT Device Power Consumption?

Optimization of power consumption in IoT devices is not something that can be done with one click. It entails many variables and processes puzzling everyone involved - from designers to IoT connectivity companies as long as their common goal to increase the reliability of data delivery and control remains unchanged.

As the number of connected devices is growing, there’s huge pressure on cellular networks. In addition, these devices require low-energy consumption, as they are often unplugged. Here are a few energy-saving aspects to take into account:

Check it from the inside

Choose power-saving microcontrollers. Use low-power sensors and nodes, and examine battery types and passive components. When creating hardware, it’s essential to assess what type of connectivity the device will be potentially capable of.

Optimize your IoT network

The emergence of LPWAN for long-distance connectivity and BLE for battery-powered IoT devices implies short to medium communication ranges. Device protocol innovations like PSM and eDRX control the sleep mode time with occasional communication with the network.

Don’t forget about the software

Program low power mode on your devices to conserve battery power, decrease the number of unnecessary tasks and notifications on the app, and work with smart monitoring.

Enjoy energy harvesting

Use immeasurable electrical energy from the ambient environment to replace the battery. The ambient sources can be represented by solar, RF, thermal, hydro, or wind-based sources. Find out more about how it works here.

Put data compression in the middle

Data and energy should be equated at some point. Data compression, both loss (Curve fitting, fractal resampling, box car, and wavelet, Fourier, etc) as well as lossless (Arithmetic Coding, Huffman Coding, Run-length Encoding (RLE), and Lempel-Ziv) along with LoRaWAN shows amazing results. Learn more about data compression.

6. Making Sure the Device Is Compatible with the IoT SIM Card

Two worlds, hardware and software, stick to each other with connectivity as the glue in between. To build a smooth data stream from sensors, gateways, modules, and chips into the cloud, it’s essential to check the device for compatibility with a definite connection option. This includes both embedded elements and additional modules as well as the peculiarities of some operators within different locations. 

Another important piece of advice would be to take into account the form factor of the SIM card, the type of device, and the environment – whether it’s a vehicle, tablet, or GPS, if it can be heated or not, etc. Based on the specific needs, you can choose Mini-SIM, Micro-SIM, Nano-SIM, or Embedded SIM. Find out more about SIM compatibility and different geo in this IoT SIM Card Guideline.

7. What’s ahead?

IoT has become a dynamic industry with skyrocketing hardware, software, and connectivity revolving around it. Today, we are more connected than ever, and this is only just the beginning of the age of IoT. New data management and connectivity solutions will arise in the coming years, which means both inexhaustible opportunities and at the same time responsibility for data collection and management.