If companies can actually make use of data from 27bn devices in the Internet of Things (IoT), they could make over $3tn according to a new report. The challenge is highlighted by the prediction that the data generated will be a stunning 2 Zettabytes (2 Zb).
The report from Machina Research predicts the total number of IoT connections will grow from 6 billion in 2015 to 27 billion in 2025, a CAGR of 16%.
Currently 71% of all IoT connections are connected using a short range technology such as WiFi or Zigbee, and by 2025 that will have grown slightly to 72%. The big short-range applications, which cause it to be the dominant technology category, are Consumer Electronics, Building Security and Building Automation. That may account for the differences in the predictions in the number o fnodes that will ship:
A key point is that cellular connections will grow from 334 million at the end of 2015 to 2.2 billion by 2025, of which the majority will be LTE. 45% of those cellular connections will be in the ‘Connected Car’ sector, including both factory-fit embedded connections and aftermarket devices. However IoT will account for less than 1% of cellular data traffic. Cellular traffic is particularly generated by digital billboards, in-vehicle connectivity and CCTV.
However, just 11% of connections in 2025 will use Low Power Wide Area (LPWA) connections such as Sigfox, LoRa and LTE-NB1.
The total IoT market will be $3 trillion in 2025. up from $750 bn last year. Just over a third will come directly from end users in the form of devices, connectivity and application revenue. The remainder comes from upstream and downstream IoT-related sources such as application development, systems integration, hosting and data monetisation.
China and the US will be neck-and-neck for dominance of the global market by 2025. China which will account for 21% of global IoT connections, ahead of the US on 20, with similar proportions for cellular connections. However, the US wins in terms of IoT revenue (22% vs 19%). Third largest market is Japan with 7% of all connections, 7% of cellular and 6% of global revenue.
“Every year we take a snapshot of the IoT market, pulling our latest forecasts to examine how the overall market had developed in the year," said Machina Research CEO Matt Hatton. "This year the top line figures of 27 billion connections and USD3 trillion of revenue continue are eye-catching and the opportunity is substantial. However it's not just a case of rising tides lifting all boats. To take advantage of the opportunities in IoT, suppliers need to understand the key market dynamics and their competitive environment, and develop best practice. Most of what Machina Research does is focused on supporting various players understand and exploit the opportunities we outline in this study”.
The IoT Global Forecast & Analysis 2015-2025 report provides an overview of the total market opportunity in the Internet of Things, based on on-going analysis of the market as presented in the Machina Research IoT Forecast Database.
The IoT Global Forecast & Analysis 2015-2025 report provides an overview of the total market opportunity in the Internet of Things, based on on-going analysis of the market as presented in the Machina Research IoT Forecast Database.
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