The present subject matter discloses a system and method for optimizing data communication of Internet of Things (IoT) devices. The system comprises a collection of IoT devices, an IoT server, a management console, third party IoT gateways and user devices. The IoT device is connected to a sensor or an actuator. The IoT device identifies attributes of the sensor or the actuator. Further, the IoT device receives raw data generated by the sensor or the actuator. Subsequently, the IoT device defines data types for the raw data based on the attributes and define bit stream storage for the data types. The IoT device may optimize data-transmission size of the data types and bit stream storage using a communication protocol and transmit the raw data to the IoT server. The IoT server may transcode the raw data into a desired format and relay transcoded data to a management console.