Published: Sep 08, 2022

what is IoT architecture?

The Internet of Things architecture refers to the interconnectedness of multiple elements, such as smart objects, internet-based structures, and cloud services that communicate and collate data without requiring human interaction. This solution consists of several building blocks, ranging from IoT sensors and data aggregation to analytics and data storage.

It has only been years since IoT architecture has become integral in the development of different industries worldwide, so we have yet to discover multiple possibilities from this technology. One such example is the integration of blockchain into IoT devices.

But how does IoT architecture work? What makes up the entire IoT architecture framework? How can industries benefit from this technology? This article will answer these questions and discuss what makes this method the thing of the future.

What is an IoT System?

An IoT system is a network of smart objects and gadgets with embedded sensors for gathering data. These IoT devices communicate by transferring data with other gadgets or over the internet.

These devices can be in the form of household appliances or industrial equipment. According to experts, there are currently over 10 billion IoT devices worldwide. By 2025, this number would rise to more than 22 billion.

Types of IoT Networks

Below are the four types of IoT networks, and each has its distinct capabilities ensuring the efficiency of an IoT architecture.

  1. Local Area Network/Personal Area Network (LAN/PAN)
    The two popular technologies are Wi-Fi and Bluetooth. However, both networks are considered wireless because users do not require an Ethernet cable to connect to the internet.
  • Wi-Fi
    Wi-Fi or Wireless Fidelity network is one of the most common and frequently used IoT network protocols. This option has limited coverage and scalability, so it might not be efficient for a network with multiple IoT sensors because its bandwidth gets weaker the more IoT devices are added to the network. Nevertheless, because of its short network range capability, Wi-Fi makes an ideal network protocol for smart objects or gadgets in a building or in-house setting.
  • Bluetooth
    Bluetooth is another widely used IoT platform because of its minimal power and energy consumption rate. For this reason, Bluetooth-enabled smart objects are considered efficient for sending aggregated data to cloud services.
    Bluetooth has become a ubiquitous IoT technology in every smart device with an in-built medical or health application. Examples of smart objects with this connectivity protocol are smart home devices, Bluetooth beacons, and fitness trackers.
  1. Cellular
    Cellular networks have become a standard network system for mobile communication systems because of their high network coverage. This type of network is an excellent ideal choice for IoT applications that concern the following:
  • Home security
  • Smart home or city applications
  • Farming and food production
  • Transportation
  • Asset tracking and management
  1. Apart from that, with the introduction of 5G cellular technology, the benefits of this IoT network also extend to industrial automation processes and even public safety, among others. The healthcare industry also uses cellular networks for mobile deliveries to clinics and other medical facilities.
  2. Mesh Protocols
    Mesh protocols work perfectly on a network of IoT sensors and applications, but only at a limited range. They send data through an IoT gateway to one node, which it passes to another node, creating a mesh of interconnected data networks. In this regard, mesh networks work contrary to how most IoT systems operate, and that is by transferring and aggregating data into different IoT platforms. Zigbee and RFID (Radio Frequency Identification) are a few examples.
  3. Low Power Wide Area Network (LPWAN)
    This network protocol is used for various large-scale network industries, including asset tracking, environmental or consumables monitoring, and even smart city technologies. The LPWAN is an excellent communication system because of its high network coverage. For this reason, LPWAN is a popular choice in several industries because of its low-power consumption rate and high battery capacity.

Why is IoT Architecture important?

An IoT network provides smart objects with an effective means of transporting data from the IoT sensors or actuators to internet gateways and data acquisition centres for analysis. Without these IoT components, it is impossible to transform physical data into digital data so it can be processed and archived in data centres and cloud servers.

Three Major Layers of IoT Architecture

The three major IoT Architecture layers are Sensing, Network, and Data Processing. Each layer corresponds to a procedure that begins from the formation of digital data to its analysis in the cloud using IoT applications. Here is an extensive explanation of each significant layer of IoT architecture:

  1. Sensing Layer
    Also referred to as the physical layer, this phase consists of the sensors and actuators embedded in a smart device which is connected to the IoT system. These tools collect data from the physical environment. Generally, the aggregated information is dependent on the objectives of an organisation.
    A healthcare IoT device designed to collect data from a patient remotely, for instance, would send real-time information on a patient’s body temperature, heart rate, or blood pressure. These remote monitoring devices keep healthcare staff updated every second while they perform other tasks.
  2. Network Layer
    This layer is responsible for converting physical data into digital data and transmitting them to the internet gateway by means of IoT network protocols. Also known as the Transport Layer, this stage acts as a bridge that connects the physical layer to the data processing layer.
    The network layer performs load management for processing preliminary data by transmitting data gradually into the IoT platform, thus preventing delayed response time and helping lower energy consumption. This layer also keeps the acquired IoT data from the physical layer secure. Most IoT-enabled households or organisations have blockchain-based databases. This technology ensures all digital data is secure before processing.
  3. Data Processing Layer
    IoT data is processed, analysed, and monitored once uploaded to the cloud. During this phase, cloud-based and edge computing centres process and transform the acquired data into valuable information. The current IoT architecture systems have machine learning or artificial intelligence software that enables IoT devices to perform the said processes in an automated fashion. Such features help improve value and user interface.

Additional Layers

Apart from these layers, IoT architecture also has application and business layers, both of which precede the processing layer. In these phases, human-related input is added to the IoT architecture structure, and this factor is crucial in improving consumer products or user experience.

  • Application Layer
    The Application Layer requires human input in the form of the orchestration of IoT devices or decision-making processes. This layer helps establish service level measures and rule sets that will aid in the improvement of IoT systems, platforms, and other elements.
  • Business Layer
    Human input is incorporated in the business layer in the form of business intelligence, which initiates decision-making processes in relation to firm-level strategies. The overall potentiality of an IoT device is evaluated and analysed in this layer. This layer performs these tasks using the acquired digital data through charts, graphs, etc.

Stages of IoT Architecture

The entire IoT architecture is composed of four stages. Each has a crucial role in transferring and translating the collected data through these stages. These are the following:


IoT devices interact with the consumer or surroundings through different devices. Since these components consist of hardware, sensors and actuators make up the physical layer of the IoT system.

The sensors allow a smart device to collect data and send it to a data acquisitions centre through an internet gateway protocol. An actuator is different because it converts signal and energy into the desired output, heat or motion. Generally, an actuator comes in the form of a motor with a mechanical system; it functions by receiving cloud-based commands from the user.

Types of sensors and actuators

These IoT components come in various forms. Because of the number of industries that invest in IoT systems, the types of sensors also vary. Here are a few examples of sensors and actuators that organisations use today:

  1. Flow sensors
  2. GPS sensors
  3. Proximity sensors
  4. Humidity sensors
  5. Colour sensors
  6. Light sensors
  7. Inclinometre sensors
  8. Temperature sensors
  1. Magnetic actuators
  2. Hydraulic actuators
  3. Electric actuators
  4. Thermal actuators
  5. Relay actuators
  6. Pneumatic actuators
  7. Mechanical actuators

Internet Gateway and Data Acquisition

After receiving all of the needed data from the sensors or actuators, the internet gateway is responsible for transferring this data to a data acquisition centre. But these physical parameters originated from the physical layer, so data conversion is necessary.

This is where the data acquisition system comes in. Data acquisition systems do not just convert physical parameters or data but also facilitate data aggregation and analysis, and keep the data tamper-proof.

Edge IT System

Edge IT provides preprocessing and pre-analytics as aggregated physical data is transferred to digital data. With edge computing system stores all digital data near the sensor or actuator, which helps improve overall performance. Otherwise, sending the data directly to the cloud for processing increases the latency and weakens the bandwidth.

Another reason why data stays close to the IoT sensors and actuators is because the organisation does not require all the data gathered by a specific IoT device. In this case, the IoT edge computing system only processes the necessary data and sends it to the data centres.

Data Centres and Cloud Analytics

The data centres and cloud-based servers store all the processed data, and organisations may use these data when conducting reports and analyses. Since all digital data is sent to servers and centres, the data is managed and archived away from the sensors and actuators.

Organisations may use physical servers, but this option can be. While cloud-based servers are a cost-efficient approach, data security can become an issue since all processed data can be vulnerable to cyberattacks.

USE of Blockchain in IoT Data Centre Infrastructures

Some organisations turn to secure methods of data management. In this regard, they use digital ledgers like blockchains, ensuring the processed data using hash encryption.

Aside from data storage, smart contracts enable and facilitate intermediary-free transactions. This method ensures fast and convenient interaction between the consumer and the IoT device.

How does IoT Architecture enhance the world?

With IoT architecture, business processes have become automated, which resulted in increased productivity, streamlined tasks, zero human errors, and cost-efficiency. As innovative and technological solutions are integrated into the IoT architecture, such as blockchains, machine learning, and AI, the possibilities regarding its growth seem endless.

As of today, several industries have integrated IoT architecture systems or have invested in these technologies. With IoT architecture, organisations can make the correct decisions and improve their products or services based on the raw data received remotely from consumers worldwide.

Industries that Benefit from IoT Architecture

Industry sectors such as those in healthcare, agriculture, and education have improved their services, eased up production, buffed up safety and security policies, and enhanced customer satisfaction. The other industries that have benefited from IoT architecture are::

  • Energy
  • Education
  • Transportation
  • Finance
  • Logistics
  • Retail and E-commerce
  • Manufacturing
  • Hospitality

How do Industries benefit from IoT Architecture?

The number of industries that benefit from IoT architecture is indeed sizable. This fact is a testament to how advantageous IoT systems are, and these are the benefits they offer to those industries:

  1. Better Consumer-Oriented Services

Smart devices have sensors embedded in their hardware. These components enable these machines to operate ‘smartly’ without human intervention and according to consumers’ expectations.  

  1. Enhance Revenue and Business Opportunities

The use of IoT systems provides the possibilities and strategies for profit generation. Also, with better data analytics, organisations can determine when to adopt new business models or strategies.

  1. Increased Productivity

With repetitive tasks delegated to IoT-enabled machine-learning tools, the flow of production becomes faster, consistent, and continuous. This method also eliminates the likelihood of human-related errors, which improves productivity output.

  1. Cost-Efficient Operation

The data acquired from previous operations help organisations get insights into asset utilisation and productivity. In return, businesses can lower expenditure rates and improve business processes.


IoT architecture is a framework that enables the conversion of physical consumer data to digital data, which is used for improving consumer products and enhancing marketing or business strategies. The processes involved in IoT architecture consist of two classifications, namely: layers and stages. The different layers are sensing, transport, data processing, application, and business, while the stages are sensors/actuators, internet gateways/data acquisition, edge IT, cloud centres and data analytics.

This technological system has played a key role in several major industries worldwide. For this reason, IoT architecture is filled with possibilities and remains open to developments, such as the incorporation of blockchain technology, among other things.

Learn more about blockchain online, and find out how it can improve your IoT project. Blockchain is at the forefront of digital ledger technology and is the foundation behind most cryptocurrencies in the world, particularly bitcoin.

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