The internet of things (IoT) plays a pivotal role in transforming the industrial sector. Connecting machines to record their usage patterns is often the first step and can deliver tangible benefits. But companies that really put data — and insights — to work are predicting problems and opportunities before they occur, or even developing entirely new service-based business models. This report discusses the role machine learning plays in supporting these bigger IoT opportunities. It highlights issues that CIOs should consider as they guide organizations toward their digital potential.