Brussels,
THE NEW FRONTIERS
Internet of Things
The Internet of Things (IoT) is a network of interconnected physical devices, vehicles, appliances, and other objects embedded with sensors, software, and connectivity capabilities. These devices can collect and exchange data, enabling them to interact with each other and perform tasks with minimal human intervention.
By 2025, more than 41 billion IoT devices are expected to be deployed worldwide (IDC), driving exponential growth in data flows and pushing computing and analytics closer to the edge of the network.
In the IoT ecosystem, devices gather data through sensors, process it locally or in the cloud, and share it across platforms for real-time monitoring, automation, and intelligent decision-making. Examples include smart homes (connected lighting, heating, and security), connected health (wearables transmitting vital signs), and smart mobility (traffic optimisation, parking management, and connected car safety).
The IoT promises transformative benefits for society and the economy, but it also raises challenges in privacy, security, interoperability, and data governance. The EU’s approach is to ensure that IoT technologies are safe, sustainable, trustworthy, and aligned with European values.
By 2025, more than 41 billion IoT devices are expected to be deployed worldwide (IDC), driving exponential growth in data flows and pushing computing and analytics closer to the edge of the network.
In the IoT ecosystem, devices gather data through sensors, process it locally or in the cloud, and share it across platforms for real-time monitoring, automation, and intelligent decision-making. Examples include smart homes (connected lighting, heating, and security), connected health (wearables transmitting vital signs), and smart mobility (traffic optimisation, parking management, and connected car safety).
The IoT promises transformative benefits for society and the economy, but it also raises challenges in privacy, security, interoperability, and data governance. The EU’s approach is to ensure that IoT technologies are safe, sustainable, trustworthy, and aligned with European values.
The EU Strategy
The European Union promotes an open, human-centric, and trustworthy IoT ecosystem as part of its Digital Decade 2030 objectives. Key policy pillars include:
- Data Access and Sharing
- The Data Act (entered into force 2023, applicable from September 2025) gives users the right to access and share data generated by their IoT devices, boosting competition and innovation.
- Cybersecurity and Trust
- The Cyber Resilience Act (adopted 2024, applicable from 2027) introduces baseline cybersecurity requirements for connected products.
- The Radio Equipment Directive delegated act (2025) ensures IoT devices respect privacy and fraud-prevention requirements.
- Interoperability and Standards
- The EU supports the development of open, interoperable standards and engages in international forums to avoid fragmentation and vendor lock-in.
- Sustainability
- IoT solutions are seen as enablers of the Green Deal, supporting energy efficiency, circular economy models, sustainable farming, and smart cities.
- Skills and Innovation
- Through the Digital Europe Programme, the EU invests in skills development, testing facilities, and digital innovation hubs.
- SMEs and start-ups are supported via regulatory sandboxes and open calls to experiment with IoT applications.
EU Funding Programmes
The EU supports IoT and edge computing through several funding streams:
A. Horizon Europe
These initiatives build on Horizon 2020’s legacy of ecosystem building, interoperability, and standardisation. Today, EU funding continues to foster a European IoT and edge ecosystem that strengthens innovation, competitiveness, and resilience while ensuring sustainability and inclusiveness.
A. Horizon Europe
- Over €150 million dedicated to R&I projects on IoT, edge, and data technologies.
- Cluster 4 Destination 3 funds projects developing meta-operating systems for industrial and societal applications (buildings, automotive, agriculture, energy).
- Projects publish open calls on the EU portal to involve SMEs, start-ups, and midcaps.
- Focus on deploying secure and energy-efficient cloud and IoT infrastructures.
- Establishing common European data spaces (e.g. agriculture, mobility, energy).
- Supporting AI testing facilities, digital innovation hubs, and SME digitisation.
These initiatives build on Horizon 2020’s legacy of ecosystem building, interoperability, and standardisation. Today, EU funding continues to foster a European IoT and edge ecosystem that strengthens innovation, competitiveness, and resilience while ensuring sustainability and inclusiveness.
