Wednesday, February 08, 2017

Gartner predicts 8.4bn connected devices in the IoT in 2017

By Nick Flaherty www.flaherty.co.uk

Market researcher Gartner is predicting that 8.4 billion connected things will be in use worldwide in 2017, up 31 percent from 2016, and will reach 20.4 billion by 2020. Total spending on endpoints and services will reach almost $2 trillion in 2017. 
Regionally, Greater China, North America and Western Europe are driving the use of connected things and the three regions together will represent 67 percent of the overall Internet of Things (IoT) installed base in 2017.
Consumer Applications to Represent 63 Percent of Total IoT Applications in 2017
The consumer segment is the largest user of connected things with 5.2 billion units in 2017, which represents 63 percent of the overall number of applications in use (see Table 1). Businesses are on pace to employ 3.1 billion connected things in 2017. "Aside from automotive systems, the applications that will be most in use by consumers will be smart TVs and digital set-top boxes, while smart electric meters and commercial security cameras will be most in use by businesses," said Peter Middleton, research director at Gartner.
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            Table 1: IoT Units Installed Base by Category (Millions of Units)
            Category
            2016
            2017
            2018
            2020
            Consumer
            3,963.0
            5,244.3
            7,036.3
            12,863.0
            Business: Cross-Industry
            1,102.1
            1,501.0
            2,132.6
            4,381.4
            Business: Vertical-Specific
            1,316.6
            1,635.4
            2,027.7
            3,171.0
            Grand Total
            6,381.8
            8,380.6
            11,196.6
            20,415.4
            Source: Gartner (January 2017)
            In addition to smart meters, applications tailored to specific industry verticals (including manufacturing field devices, process sensors for electrical generating plants and real-time location devices for healthcare) will drive the use of connected things among businesses through 2017, with 1.6 billion units deployed. However, from 2018 onwards, cross-industry devices, such as those targeted at smart buildings (including LED lighting, HVAC and physical security systems) will take the lead as connectivity is driven into higher-volume, lower cost devices. In 2020, cross-industry devices will reach 4.4 billion units, while vertical-specific devices will amount to 3.2 billion units.
            Business IoT Spending to Represent 57 Percent of Overall IoT Spending in 2017
            While consumers purchase more devices, businesses spend more. In 2017, in terms of hardware spending, the use of connected things among businesses will drive $964 billion (see Table 2). Consumer applications will amount to $725 billion in 2017. By 2020, hardware spending from both segments will reach almost $3 trillion.
            Table 2: IoT Endpoint Spending by Category (Billions of Dollars)
            Category
            2016
            2017
            2018
            2020
            Consumer
            532,515
            725,696
            985,348
            1,494,466
            Business: Cross-Industry
            212,069
            280,059
            372,989
            567,659
            Business: Vertical-Specific
            634,921
            683,817
            736,543
            863,662
            Grand Total
            1,379,505
            1,689,572
            2,094,881
            2,925,787
            Source: Gartner (January 2017)
            Total IoT services spending (professional, consumer and connectivity services) is on pace to reach $273 billion in 2017. These are dominated by the professional IoT-operational technology category in which providers assist businesses in designing, implementing and operating IoT systems. However, connectivity services and consumer services will grow at a faster pace. Consumer IoT services are newer and growing off a small base. Similarly, connectivity services are growing robustly as costs drop, and new applications emerge.


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