- 1 Definition / Scope
- 2 Market Overview
- 3 Key Metrics
- 4 Market Risks
- 5 Top Market Opportunities
- 6 Market Drivers
- 7 Market Restraints
- 8 Industry Challenges
- 9 Technology Trends
- 10 Other Key Market Trends
- 11 Market Size and Forecast
- 12 Market Outlook
- 13 Technology Roadmap
- 14 Distribution Chain Analysis
- 15 Competitive Landscape
- 16 Competitive Factors
- 17 Key Market Players
- 18 Strategic Conclusion
- 19 Further Reading
- 20 Appendix
Definition / Scope
The Internet of Things refers to objects or things that are connected to the internet i.e anything can be accessed anytime and from anywhere. It comprises integrating sensors and devices into everyday objects that are connected to the internet through fixed or wireless connection. The fact that internet is present anywhere enables the feasibility of mass adoption of this technology. Given their size and price, these sensors can be integrated easily into homes, workplaces and public places. This process enables objects to be connected to the internet and manifest themselves. Moreover, in IoT any object can be a data source. IoT is not a revolutionary or innovatory concept. It is an evolutionary perception, equivalent to the evolution on the networking technologies of the present internet, service platforms and wireless.
Internet of Things can be defined as a fast emerging ecosystem of a seamless connected network of embedded objects/devices with identifiers that communicate without human intervention using standard and interoperable communication protocols.
The Internet of Things technology has three distinct stages:
- Collecting data by sensors
- Analysis and optimisation of data by a middleware application
- Transmission of data to decision maker, further data analysis with the help of analytics engines, actuators and big data.
Adoption of IoT is rapidly increasing across various industries for various verticals. Moreover IoT would be used in smart cities for smart lighting, smart parking, smart meeting, solid waste management, etc.
IoT Components Architecture
The IoT Components includes the following:
Things: Comprises various objects found in commercial settings or at homes, Also includes distinct devices such as sensors, RFID, Wearables and mobile devices.
Local Network: Different Local communication technologies including short range, cellular, satellite and others which help in transferring data generated from devices/things for further analysis of these data sets. Local networks also provide uninterrupted connectivity, improved management and also enhance security for establishing an efficient and reliable network.
Internet: It is a global ecosystem of networks of interconnected IP networks for linking computer systems together. It also helps in retrieving data from the cloud and analysing it.
The Asia-Pacific Internet of Things (IoT) Market is expected to grow from USD 313.97 Billion in 2018 to USD 481.8 Billion by 2022 growing at a CAGR of 11.3% during the forecast period (2018 to 2022).
The number of IoT connected devices in Asia-Pacific is estimated to be 3.67 Billion in 2018 and is expected to grow to 7 Billion devices by 2022 growing at a CAGR of 17.17% in the forecast period (2018 to 2022)
The solutions segment holds the major market share in the forecast period (2018 to 2023).Major trends contributing to the growth of the IoT market are the increasing security breaches in critical infrastructure and personal data. IoT security solution includes services such as identity access management, data encryption and tokenization, intrusion detection system / intrusion prevention system, device authentication and management. Secure software and firmware update, secure communications, Public Key Infrastructure (PKI) lifecycle management, Distributed Denial of Service (DDoS) protection, security analytics, and others (virtual firewall and incidence response system). These systems enable enterprises to meet their requirements, which aids in securing their IoT devices.
The Network security segment to account for the highest market share in the forecast period (2018 to 2023). Network security is a technique for securing network by analysing and collecting the different types of network security event information. It combines the multiple layers of security in the edge and in the network. It is one of the most important aspects when it comes to securing IoT ecosystem. It constitutes wireless communication, remote access security, and gateway. In the IoT ecosystem, most of the communication is carried out through remote devices therefore the security of these devices plays a key role in the network security. The Key factor driving the growth of network security is the increasing adoption of IoT devices across various domains.
The Device Authentication Management segment accounts for the major market share in the forecast Identity access and management refers to a business process framework. This Framework constitutes policies and technologies that enables access to technology resources for employees. It is the process of managing attributes such as phone numbers, email addresses, social security number, and authenticating identities. IoT is gaining traction across industries due to robust offerings. With the expanding reach of IoT multiple end users and devices can be connected to the network. One of the main reasons to cyberattacks is unauthorized access to resources due to intrusion. Identity access management plays a key role in managing enterprise electronic or digital identities. These solutions can be quickly and cost-effectively integrated with identity access management policies across on-premise, cloud and hybrid environments.
Asia Pacific lead by China and Japan is anticipated to witness significant growth for internet of things market in forecast period owing to increasing spending in network infrastructure by organizations to enhance their productivity. Rising manufacturing sector in the region will further support the IOT growth. Manufacturing sector is one of the largest end user of IOT technologies. Increasing demand to track and manage inventories will supplement the rising internet of things market size. Fleet management in transportation sector will propel the demand for IOT technologies. In emerging countries mainly India, government initiative to develop strong IOT infrastructure will propel the internet of things market size.
|Base Year||2018||Researched through internet|
Lack of Synchronized and Uniform Revenue
As IoT market is spread and categorised across several verticals such as security, integration, hardware and software there exists a constraint of Synchronization of the activities across these segments. Also there exists no uniformity in the revenues generated across the verticals, as some verticals generate more revenues and others generating lesser revenues and hence affects the growth of the IoT market as the market concentration is laid on high revenue generating areas and thereby leaving the low revenue generating areas into stagnated area as no linearity exists in revenue generation across the verticals of IoT market.
Lack of unanimously accepted operational standards
The Lack of Standards affect widespread, efficient IoT adoption. Different standards, connectivity patterns and stages of maturity escalates security risks with availability of multiple touch points for hacking. Further competing standards, vendor lock-in, proprietary devices and private networks makes it difficult for devices to share a common security protocol. Common standards by definition mean better security, whereas different standards, connectivity patterns and stages of maturity opens door for hackers.
It becomes challenging for IoT companies to agree on common interoperability protocols and standards for sharing and protecting data and for the hardware sensors that collect the data. For example, if an IoT arterial blood gas monitor is affected with malware and being used for data processing of patient records and can’t communicate with the systems to warn about an impending patient health event affects the purpose of the device being connected to the network.
According to practitioners and security experts, lack of loyalty to a common standard for connected devices in other business environments is a major barrier affecting the mass adoption of this technology. While one of the barrier is non-availability of common standards another hurdle is the availability of too many standards that enforces a single standard to be adopted for widespread acceptance.
Top Market Opportunities
Potential growth opportunities for system integrators
IoT offers growth opportunities for system integrators in the form of new product development opportunities. Better data will help improve products and creates relevance with customers. Businesses will have insights on how their products are used, thereby improving the design and the product development process. In the time of technological advancement customers are unaware of which technology or service or a combination of technology and service are offering value to their businesses. In the information technology domain this role has been filled by System Integrators (Sis). System integrator will benefit customers and vendors mutually, states Forbes Magazine. Customers in need of an IoT solution will be educated on how to find, integrate or combine solutions that cater best to their needs. For vendors on the other hand system integrator can help in accelerating adoption and usage of their product in segments which all have their own specific needs and problems. SIs are highly engaged with the end users and are built for integrating solutions from multiple vendors to solve operational technology (OT) problems. It therefore seems, that hardware and software vendors with the most robust SI channel will be the fastest to market and the quickest to create revenues. This puts SIs into the unique opportunity to be sought after by both solution providers and users, offering them great market potential.
Smart Energy and Utilities
The IoT solutions in Energy sector are aimed at achieving convergence of machines and intelligent data to enhance the operational efficiency targets being set by the energy companies. The development of ‘Smart Grids’ is the first application of IoT technology in the energy sector. They are capable of meeting rising demand, increasing quality and reliability of power supplies, increasing efficiency and linking low carbon sources to the power network. Further, the energy sector has started deploying end-to-end solutions such as ‘Advance Metering Infrastructure’ (AMI), which enables two-way communication between customers and the utilities, and ‘In-Home-Displays’ (IHD), which helps consumers monitor and control their energy usage.
Smart Manufacturing involves the integration of human and machine intelligence and data sharing between sensors, computerized control, information technology and production management software. It offers interconnection of individual stages of manufacturing production to facilitate plant-wide efficiency. It allows businesses to develop advanced models and simulation for optimization of manufacturing process. Manufacturing enterprises are focusing on increasing their production capacities and increase their business process efficiency with optimal utilization of resources. One of the major factors driving the adoption of IoT-led deployment models in manufacturing is having access to standardized and consistent unified view of the data and processes for seamless access for most of the stakeholders. Industrial IoT vendors are achieving efficiency in multiple heterogeneous manufacturing processes by integrating IoT platforms and solutions to automate manufacturing operations.
IoT is reshaping and revolutionizing the retail industry. The IoT in retail is accelerating the time to solution deployment, enables cost savings, improves efficiency, inventory accuracy, smarter marketing and enables better customer experiences with an end-to-end solution. With the advancement in technology and improvements in sensors, better connectivity and communication solutions and new devices, lead to the development of the smart retail industry.
Building and Home Automation
The market for building and home automation is improving with the advent of connected devices for buildings and houses. Nowadays consumers are more interested in the way that Home Automation provides convenience, savings and security. The advancements in Home Automation opens room for new revenue generation opportunities and better ways for businesses to connect with customers to deliver better service, more value and greater innovation. However managing a multitude of connected devices requires highly advanced IoT software. The companies are offering platforms that manage Home Automation and other connected devices. It simplifies the process of provisioning and securing IoT devices, managing and integrating the data they generate and turning that data into insight.
Development of Wireless Networking Technology
A large number of wireless technologies now enable communication among devices. This increase in connectivity among devices enables a large number of user base to purchase IoT devices. High speed connectivity has opened up new avenues for businesses across industry verticals. The Advancements in the high speed wireless technology and the number of devices connected to these networks are increasing rapidly. LTE is the modern wireless high speed wireless connection standard for mobile phones and data terminals, which support 4G services. LTE is important as it enables connectivity to ever limited spectrum to low power IoT devices with back-end system. Additionally the introduction and evolution of IPV6 is driving the demand for connected devices in organizations. The deployment of IPV6 addresses will have a positive impact on the adoption of IoT devices. An additional feature of IPV6 is that IPV6 makes the management of network simpler due to auto-pattern capabilities and provides security and advanced privacy measures.
Increase in cloud platform adoption
IoT cloud platforms bring together capabilities of IoT devices and cloud computing delivered as a service over an end-to-end platform. In this age where billions of devices are connected to the internet there is an increasing potential of tapping big data acquired from these devices and processing them through various applications. The IoT cloud platform extends the ability of provisioning of resources that are user-centric, which increases the count and scale of data and devices. The cloud platform services can not only process big data from a wider set of IoT devices, but also provides a smart way to provision and manage each of them in an efficient manner. One of the main differentiators of IoT cloud platforms is the ability to process large volumes of data generated by the various IoT devices and applications. The sheer ability to process large volumes of data by the IoT cloud platforms propels the growth of the IoT market.
Advent of advanced data analytics and data processing
The explosive growth of number of devices connected to the IoT and the exponential growth in the amount of data consumed outlines how the growth of data analytics is connected to the growth of IoT. The IoT is expected to produce a large volume of data, the data generated can be used for various purposes such as finding potential research trends and in investigating the impact of certain outcomes or decisions. These data are processed using various data analytics tools. Although IoT offers opportunities that it can be used to increase revenue, reduce costs, and improve efficiency. Collecting a huge amount of data alone cannot be sufficient. To generate benefits IoT enterprises that create a platform where they can collect, manage and process a large amount of sensor generated data in a scalable and cost-effective manner by adopting data analytics and data processing technologies. Data integration and analytics allow organizations to revolutionize their business process. Specifically these enterprises can use data analytics tools to transform a huge volume of sensor-collected data into valuable insights. The advent of advanced analytics and data processing techniques, which have been useful to derive results from high volumes of data collected from the machine-to-machine communication devices. Industry focus on innovative technologies providing real time data to improve performance and optimize operations are anticipated to increase substantially which will add to internet of things market size.
Reduction in cost of connected devices
There has been a continual decline in the price of the IoT Sensors and other connected devices and this positively affects the growth of the IoT Market in the APAC region. The primary reason for the decline in the price of IoT devices is aided by factors such as more IoT vendors entering the market as a result of which competition increases and hence connected device companies are offering more innovative types of devices and are looking ways to decrease the cost. The other factors fuelling the decrease in IoT devices are the constant optimization of the IoT sensors and innovation happening in the IoT technology. The reduction in cost of connected devices is expected to fuel the adoption of IoT devices.
Data Privacy and Security Concern
One of the distinct features of the IoT is the increasingly personal nature of the information being collected by these devices. Connecting automobiles means that others can access the real time vehicle movement and the way in which it is operated. The use of smart devices in homes can also reveal the residents habits and the way they live their lives. Attaching medical records to the connected devices also reveal sensitive information such as patient’s health information as a result of which the private data of individuals are at risk and causes security concern which affects the adoption of IoT devices.
Lack of seamless Interoperability
IoT interoperability is one of the central challenges for the adoption of IoT devices. IoT ecosystem lacks basic interoperability to connect devices and sensors seamlessly. There exist no set rules or standards at the application level, causing an inability to combine and compliment the collected data from different sensors and devices. The IoT market is attracting a large number of vendors and other players including standalone device providers, platform enablers and service-based ecosystems. In an attempt to capture IoT market share, these vendors and solution providers are fragmenting the market and offering IoT products with different standards hence causing interoperability issues.
Compatibility and Longevity issues
IoT is growing in many different directions, with many different technologies, with many different technologies competing to become the standard. This will cause difficulties and require deployment of additional hardware and software when connecting devices. Other compatibility issues occur as a result of non-unified cloud services, lack of standardized M2M Protocols and diversities in firmware and operating system among IoT devices. As some of the technologies would become obsolete in the next few years, effectively making the devices implementing them useless. In contrast to the generic computing devices which have a lifespan of few years. IoT appliances (such as Smart Fridges or TVs) tend to remain in service for much longer and should be able to sustain even if their manufacturer goes out of business. The Longevity of the IoT device is a pressing issue suppressing their growth.
Data Connectivity issues
The Data Connectivity is one of the most ignored challenges in the IoT domain has data connectivity has vastly improved. Yet there exists some areas of data connectivity that cause implementation issues in IoT segment. It involves how IoT devices are connected to the gateway and the cloud and what data format do they generate. Most IoT gateways available are compatible with GPRS and Wi-Fi/LAN, but legacy devices depend on PLCs, telemetry systems and RTUs to generate data, which affects the uptake of IoT devices.
Data capturing in IoT occurs through sesnors, PLCs, etc. which are connected to the IoT gateways to collect and transmit data to the cloud. Enterprises need to meticulously identify the equipment, hardware, and existing legacy machines based on their goals and business outcomes. When there are legacy machines that do not have the said PLCs and sensors involved, the IoT implementation challenge becomes more critical. Adding external sensors to the legacy machines is one quick work around, but it will not be fool proof, making it a very challenging task. The deployment challenge associated with the implementation of IoT solution cripples the adoption of IoT devices.
The real value of an IoT solution is realized through actionable insights collected from the IoT collected data. This demands a high-performance analytics platform that is capable of processing vast amount of data to be added in the solution at a later point. Data Analytics partners need to be wary of this during IoT implementation architecture to involve data processing, cleansing and representation.
The High price perception of IoT technology by the consumers aided by Lack of compelling use-cases and viable business models are the primary reasons affecting the uptake of IoT technology as a viable business option and hence are not concentrated by the major vendors as a result of which the IoT market is highly fragmented with a few number of market players coming up with feasible solutions that solve real-world problems, while others are seen as a POC (Proof of Concept) solutions that lacks a viable reason for existence. These factors in addition to the factors such as Ambiguous ROI which is as a result of fragmention of technology stacks across various vendors causes Scalability issues for the mass-adoption of the IoT technology.
Wearable devices are catching lots of attention in the recent past and some of the big names such as Google are focusing on the wearable devices market. A wearable device is an electronic device capable of storing and processing data that is incorporated into a person's clothing or personal accessories. The most promising applications in wearable devices market are infotainment, fitness and healthcare. Because these applications can satisfy people’s needs of life and are easily controlled with smart devices like smart phones. According to IHS, there will be 250 million wearable devices in 2018, most of them are applied in the three vertical markets. The service revenue will exceed USD6 billion in 2018 inclusive of remote patient monitoring, support for gaming and enterprise applications, and military research. There are all kinds of wearable devices in the market: smart glasses, smart clothing, smart watches, smart wristbands and so on. Other than the famous wearable devices like Google glasses, Apple watch, there are many other innovation products. CardioNet, a company in USA, has developed an integrated technology and service - Mobile Cardiac Outpatient Telemetry (MCOT) which enables heartbeat-by-heartbeat, ECG monitoring, analysis and response, at home or away. CardioNet monitors patients 24 hours a day via a small sensor and monitor patients as they continue with their normal daily routines. As events occur, patient activity is transmitted automatically to the CardioNet Monitoring Centre for analysis and response.
Xiamen Yunduo Network Technology Co. Ltd, a start-up company in China, has designed a device to help parents locate their children via GPS on their smartphones. The accuracy can reach 5 meters in an open area. Parents can also determine a safe zone for the child. Once the child leaves this zone, the GPS tracker will alert the parents via an app. These GPS tracker shoes can also remember a child's whereabouts. When the child reaches a new area unrecognised by the tracker, it will send an alert immediately. Parents can also create a supervisor group and invite other friends or family members to look out for their children. Priced at USUSD48, these shoes are inspired by Marvel and Disney characters, and use a 370mAh polymer battery that can last for 32 hours on one charge.
Blockchain & IoT
Blockchain technology solves many issues when it comes to enabling peer-to-peer contractual behaviour without any third-party to certify the IoT transaction. Blockchain technology comes into play by solving the mega issues such as scalability, threat of single point failure, time stamping and securing transactions in a consistent manner.
Blockchain technology can be used to provide a simple infrastructure for two devices to transfer a part of property such as money or data between one another. On top that the transaction would be done with a secure and reliable time-stamped contractual handshake. Further, smart contracts could be leveraged by IoT devices to enable message exchanges between the two parties. This feature enables the autonomous functioning of smart devices without the need for an actual centralized authority. If the feature of peer-to-peer transaction is extended to human-to-human or human-to-objects a fully distributed trustworthy digital infrastructure capable of connecting, transacting and interacting with each other will be created.
Other Key Market Trends
The early adoption of IoT has been seen in the Logistics and transportation sector; this has been driven by the fact that it is an easier demonstration of RoI together with an ability to have quick wins. Fleet management for example using IoT can provide immediate RoI to the fleet owners.
From a consumer perspective, the areas of Wearables together with connected homes and cars are in the lead in terms of adoption as of now.
However, as IoT matures, other industry verticals like manufacturing, healthcare, would begin to garner a greater share of the adoption of IoT.
Market Size and Forecast
The APAC Internet of Things (IoT) market is expected to grow at a compounded annual growth rate of 11.3% between 2018 and 2022 to reach a market size of USD 481.8 Billion by the end of 2022. Rising influx of smart city initiative Asia-Pacific, massive implementation of AI based safety solutions, growing public security threats and several others are the major growth drivers for fuelling the market growth more significantly in the region.
China IoT Market Size
- USD 159.1 Billion – The estimated market size of the Chinese IoT Market in 2018
- 11.3% - The CAGR growth rate of the Chinese IoT market in the forecast period 2018 to 2022
- USD 244.15 Billion- The expected market size of the Chinese IoT Market in 2022
Japan IoT Market Size
- USD 143.29 Billion – The estimated market size of the Japanese IoT Market in 2018
- 11.4% - The CAGR growth rate of the Japanese IoT market in the forecast period 2018 to 2022
- USD 220.68 Billion- The expected market size of the Japanese IoT Market in 2022
South Korea IoT Market Size
- USD 22.6 Billion – The estimated market size of the South Korean IoT Market in 2018
- 11.6% - The CAGR growth rate of the South Korean IoT market in the forecast period 2018 to 2022
- USD 35.06 Billion- The expected market size of the South Korean IoT Market in 2022
India IoT Market Size
- USD 19.6 Billion – The estimated market size of the Indian IoT Market in 2018
- 11.8% - The CAGR growth rate of the Indian IoT market size in the forecast period 2018 to 2022
- USD 30.62 Billion- The expected market size of the Indian IoT Market in 2022
The market size of the APAC IoT market is estimated to be USD 313.97 Billion in 2018 and is expected to reach a market size of USD 481.8 Billion in 2022 growing at a rapid growth rate of 11.3% in the forecast period 2018 to 2022
The APAC region will be the global leader in IoT spending in the year 2019 with around 36.9% of the World Wide spends.
China is the top spender in the region with USD 159.1 Billion accounted for the year 2018 followed by Japan with spending of USD 143.29 Billion, preceded by South Korea and India with a spending of USD 22.6 Billion and USD 19.6 Billion in 2018 respectively.
IoT services is the largest technology category in 2018 with USD 83.5 billion going toward traditional IT and installation services as well as non-traditional device and operational services.
Hardware spending at USD 78.4 billion in 2018 is the second largest technology category in 2018 and is expected to grow rapidly led by more than USD65.7 billion in module/sensor purchases.
IoT software spending total USD43.3 billion in 2018 and will see the fastest growth over the forecast period (2018-22) with a CAGR of 15.8%
Services spending will also grow faster than overall IoT spending with a CAGR of 13.3% in the forecast period (2018-22).
South Korea is the top APAC country in terms of per capita IoT spending followed by Australia and New Zealand.
The top three industries spending most on IoT solutions in 2018 are discrete manufacturing (USD43.9 billion), process manufacturing (USD33.2 billion), and utilities (USD20.1 billion).
The industries that will see the fastest compound annual growth rates (CAGR) over the forecast period (2018 to 2022) are Telecommunications (16.6%), Construction (15.9%), and Healthcare (15.6%).
IoT in Healthcare
A number of connected devices have been developed to improve health care delivery. Over the past 10 to 15 years, health care providers have increasingly become connected through mobile computers, iPads, iPhones, Wi-Fi phones, and communications badges. A number of companies are now working on developing further connectivity to improve communication between health care givers and patients by using IOT technology. In addition, many applications in healthcare have been developed to reduce cost and improve patients experience.
There are people all over the world whose health may suffer because they do have ready access to effective health monitoring. Small, powerful wireless solutions connected through the IOT are now making it possible for monitoring. These solutions can be used to securely capture patient health data from a variety of sensors, apply complex algorithms to analyse the data and then share it through wireless connectivity with medical professionals who can make appropriate health recommendations. Utilising remote monitoring in patients with cardiac and chronic diseases is expected to save USD36 billion in the healthcare industry.
IoT is becoming a pivotal technology for Home Care particularly in case of aging population. An aging population is a big issue not only for developed economies, but also for developing economies like China. As more elderly require healthcare services at home and most of them live alone, IOT enables monitoring, alarm, remote advice and integrate all data in cloud-based solutions, which the patients, hospitals and insurance can access easily.
Connected car is not new, telematics services have been on market for years. Telematics services including automatic crash notification, stolen vehicle assistance, diagnostics, and navigation. With IOT and wireless (3/4G, Wi-Fi) technologies, there are new applications including remote downloading of mapping/traffic information, fuel saving, accident avoidance and streaming digital music and video, the connection can be extended to vehicle-to-vehicle and vehicle-to-roadside with sensors. According to BI, there will be 100 million new cars will have their own internet connections by 2020. And major manufactures have entered this huge market, including Audi, BMW, Volvo, and Ford.
Connected car is not only a huge market but also make significant contribution to global GDP. Morgan Stanley Research believes the Chinese economy can save USD 1.3 trillion per year once autonomous cars become fully penetrated. To put that number in context, it represents 12% of Chinese GDP. Morgan Stanley Research estimates global savings from autonomous vehicles to be in the region of USD5.6 trillion per year.
A smart city uses innovation and technologies to enhance performance and well-being, to reduce costs and resource consumption and to engage more effectively and actively with its citizens. Cutting-edge ICT systems and other modern innovations play an important role in the success of today’s cities. ICT networks enable integration into global production chains, facilitate rapid information sharing and participatory communication, and decrease the traditional challenges of distance and time. A thriving, modern city leverages ICT and a smart and resilient infrastructure to facilitate and enhance its economic growth. It has significant impact on the efficiency and capacity of infrastructure and service delivery to citizens, their economic opportunity, and overall quality of life. Smart cities could therefore provide:
- Better and more convenient services for citizens;
- Better city governance;
- A better life environment;
- More modern industry, that is greener, and more people friendly;
- Smarter and more intelligent infrastructure; and
- A dynamic and innovative economy.
Residential citizens will lead the way by increasingly investing in smart-home solutions, with the number of connected things used in smart homes to surpass 1 billion units in 2018. Connected things include smart LED lighting, healthcare monitoring, smart locks and various sensors for things such as motion detection or carbon monoxide. Smart LED lighting will record the highest growth of IOT consumer applications, from 6 million units in 2015 to 570 million units by 2020. Light will move from being an illumination source to a communications carrier incorporating safety, health, pollution and personalised services.
While investment in IOT hardware is fundamental for smart cities, the revenue opportunity is in the services and analytics sector. Gartner estimates that smart-home security and safety will represent the second-largest service market by revenue in 2017, and by 2020, the smart healthcare and fitness market would have grown to nearly USD 38 billion.
Distribution Chain Analysis
With the rapid development of the IOT, the private sector within the IOT ecosystem gradually find their own roadmaps in the IOT services. Given the huge development potential of the IOT industry, there are opportunities for all kinds of companies to develop their business models and profitable markets.
Sensors/ Gateway vendors
Many vendors set up industry alliances to compete on IOT standards. The chip providers attempt to dominate the market and seize the market share. The Linux Foundation has announced the formation of the AllSeen Alliance, a new consortium dedicated to building and maintaining an open-source framework that lets devices of all shapes and sizes seamlessly communicate with each other. Qualcomm, LG, Panasonic, Haier, Silicon Image and TP-LINK are headlining the initiative, which also includes names as diverse as Cisco, Sears, and Wilocity. Qualcomm is the leader of the alliance because the entire AlleSeen Alliance is based on Qualcomm’s technology.
Samsung, Google-owned Nest Labs, and five other companies have collaborated to create Thread Group, which will focus on developing a new wireless-networking protocol for smart homes. Thread uses both the same frequency and radio chips as Zigbee, a standards-based wireless technology utilised by products like Phillips’ customisable Hue LED light bulbs. It can connect more than 250 devices to a low-power, mesh network equipped with internet and cloud access. The new protocol is intended to address some of the issues present within the competition, including lack of interoperability, high power requirements, and hardware dependencies.
Smartphone is becoming the control Hub of IOT services. IT vendors have an advantage in terminal devices and provide development tools.
Apple has positioned itself to be the “home base” of the “Internet of things” by introducing CarPlay, HomeKit and HeathKit. With its iOS devices, Apple have become the centre of the Internet/Bluetooth connected “things”. Apple is providing the platform for all the IOT products to connect to or to be monitored by them: a platform for health, home, car and everything around customers.
Smartphone vendors also collect and analyse data from sensors, and provide services as a control Hub. Google’s move to acquire Nest Labs and Dropcam highlights the company’s strategic vision of leading the smart home automation market. By incorporating a market leading home security solution alongside Nest Lab’s existing thermostat and smoke detector products, Google is taking an important step toward offering an ecosystem of smart home products and applications.
Network operators and vendors
Network elements need to handle charging, subscription and massive support for small packages. Currently, 3G/4G communications technologies are dominant and LTE-M technologies are expected to be dominant in the future. While operators and vendors are reviewing their connectivity roadmaps 27 against the IOT requirements and the potential threats from new entrants and start-ups, LTE-M, an evolution of LTE optimised for IOT in 3GPP RAN has been released. LTE-M is touted as a superior solution to satisfy the connectivity profiles and requirements for IOT since cellular IOT provides an easy software upgrade of existing networks while providing optimised device KPIs, battery life, coverage and cost. Besides network ability development, telecom providers also actively participate in engaging with proper terminal device vendors, in order to develop an IOT platform.
China Mobile has launched OneNet device cloud platform targeting Chinese enterprise users. The OneNet device cloud platform is a cloud service and information handling platform connecting terminals and applications. It provides Internet of Things enterprises with multiple protocols and access support and it can realize connection between smart devices and applications. In addition, it provides professional PaaS cloud services, targeting product prototyping, commercial use, and daily management.
Big data companies and IT vendors
Big data companies and IT vendors are using the information to create value and improve products. IBM’s ‘smarter cities’ initiative pushes the digitisation of a city’s systems, turning the workings of those systems into measurable data points. Rio de Janeiro, in Brazil, has become one of the first cities in the world to gain ‘smart city’ status with the establishment of a centralised command centre that integrates more than 30 city agencies. The command centre helps the city improve emergency response co-ordination, manage increased traffic, and predict and counteract natural disasters.
The internet of things (IoT) market is highly competitive owing to the presence of many large and small players in the market operating in the domestic as well as in the international market. The market appears to be fragmented due to the presence of many technological giants in the market. Key strategies adopted by the major players in the market are product innovation and mergers and acquisitions. Some of the major players in the market are Cisco Systems, Inc., Google, Inc., IBM Corporation, and Microsoft Corporation among others.
- June 2019 - Cisco extended its intent-based networking to some of the most challenging work environments on Earth. Cisco is introducing new networking technology purpose-built to withstand the rigors of the harshest of environments while providing IT and OT teams with intent-based networking capabilities to scale and accelerate IoT projects.
- April 2019 - IBM Corporation announced a collaboration with Sund & Bælt, which owns and operates some of the largest infrastructures in the world, to assist in IBM's development of an AI-powered IoT solution designed to help prolong the lifespan of aging bridges, tunnels, highways, and railways.
Some of the Competitive Factors in the IoT Market include:
Research and development (R&D) is the part of a company's operations that seeks knowledge to develop, design, and enhance its products, services, technologies, or processes. Along with creating new products and adding features to old ones, investing in R&D connects various parts of a company's strategy and business plan, such as marketing and cost reduction.
Competitive pricing is the process of selecting strategic price points to best take advantage of a product or service based market relative to competition. This pricing method is used more often by businesses selling similar products since services can vary from business to business, while the attributes of a product remain similar. This type of pricing strategy is generally used once a price for a product or service has reached a level of equilibrium, which occurs when a product has been on the market for a long time and there are many substitutes for the product.
Key Market Players
The Key Market Players segmented based on various platforms are as follows:
- ARM HOLDING PLC
- BROADCOM CORP.
- FREESCALE SEMICONDUCTOR INC.
- IMAGINATION TECHNOLOGIES INC.
- INTEL CORP.
- MARVEL SEMICONDUCTOR INC.
- MEDIATEK INC.
- QUALCOMM INCORPORATED
- TEXAS INSTRUMENTS INC.
- IOBRIDGE INC.
- BUG LABS
- MICROSOFT CORP.
- ORACLE CORP.
- XIVELY BY LOGMEIN
- IoT Open Source Platforms
IoT Chipsets and platforms
- ELECTRIC IMP INC.
- INVENSENSE INC.
- APIGY INC.
- APPLE INC.
- BELKIN INTERNATIONAL
- CONTROL4 CORP.
- CRESTRON ELECTRONICS INC.
- GOOGLE LLC
- ISMARTALARM INC.
- LG ELECTRONICS INC.
- SAVANT SYSTEMS LLC
- SIGMA DESIGNS INC.
- WHIRLPOOL CORP.
- FITBIT INC.
- NIKE INC.
- SONY CORP.
- WITHINGS USA
- 3D ROBOTICS
- AMAZON ROBOTICS LLC.
- CISCO SYSTEMS INC.
- DOUBLE ROBOTICS
- IHEALTH LAB INC.
- JOHNSON & JOHNSON
- MEDTRONIC INC.
Energy and Utility
- ACLARA TECHNOLOGIES LLC
- AMPLIA SOLUCIONES S.L.
- C3 INC.
- CARRIOTS S.L.
- DAVRA NETWORKS LIMITED
- ENERGYWORX B.V.
- GENERAL ELECTRIC CORP.
- HONEYWELL INTERNATIONAL INC.
- IBM CORP.
- NETWORKED ENERGY SERVICES (NES) CORP.
- NORTHWEST ANALYTICS INC.
- OSISOFT LLC
- SAP SE
- SILVER SPRING NETWORKS INC.
- SYMBOTICWARE INC.
- TERADATA CORP.
- TRILLIANT INCORPORATED
- ACCEL AB
- ALEPH AMERICA
- ALPS ELECTRIC CO. LTD.
- AMS AG
- ANALOG DEVICES, INC.
- BANNER ENGINEERING CORP.
- BAUMER HOLDINGS AG
- BOURNS SENSORS GMBH
- CAMBRIDGE CMOS SENSORS LTD.
- COGNEX CORP.
- COOPER INSTRUMENTS & SYSTEMS
- CTS CORP.
- CUSTOM SENSORS & TECHNOLOGIES (CST)
- DELPHI CORP.
- DENSO CORP.
- EMERSON PROCESS MANAGEMENT
- ENDRESS+HAUSER INSTRUMENTS INTERNATIONAL AG
- ENLIGHTED INC.
- FIGARO ENGINEERING
- FINGERPRINT CARDS AB
- FLEXPOINT SENSOR SYSTEMS INC.
- FLINTEC GMBH
- FLIR SYSTEMS INC.
- GE MEASUREMENT & CONTROL
- GPIXEL INC.
- HANS TURCK GMBH & CO. KG
- HITACHI AUTOMOTIVE SYSTEMS
- IFM ELECTRONIC GMBH
- INFINEON TECHNOLOGIES AG
- INTERLINK ELECTRONICS INC.
- JEWELL INSTRUMENTS LLC
- JOHNSON CONTROLS INC.
- JUMO GMBH & CO. KG
- KEYENCE CORP.
- KISTLER INSTRUMENTE GMBH
- LEDDARTECH INC.
- LITELLFUSE INC.
- MICRONAS SEMICONDUCTOR HOLDING AG
- MITSUBISHI ELECTRIC CORP.
- MTS SYSTEMS CORP.
- MURATA MANUFACTURING CO. LTD.
- MEMSIC, INC
- NXP SEMICONDUCTORS N.V.
- OMRON SCIENTIFIC TECHNOLOGIES INC.
- ONCQUE CORP.
- OPTEK TECHNOLOGY INC.
- PANASONIC CORP.
- RAYTEK CORP.
- RFMICRON INC.
- ROBERT BOSCH GMBH
- ROCKWELL AUTOMATION
- SCHNEIDER ELECTRIC
- SCHRADER INTERNATIONAL INC.
- SENSEOR SAS
- SENSIRION AG
- SENSITEC GMBH
- SENSONOR TECHNOLOGIES AS
- SENSOR SCIENTIFIC INC.
- SHANGHAI TM AUTOMATION INSTRUMENTS CO. LTD.
- SICK AG
- SIEMENS MILLTRONICS PROCESS INSTRUMENT INC.
- STMICROELECTRONICS N.V.
- SUMITOMO ELECTRIC INDUSTRIES LTD.
- TDK CORP.
- TE CONNECTIVITY LTD.
- TEKSCAN INC.
- TEXAS INSTRUMENTS, INC.
- TOWER SEMICONDUCTOR LTD.
- VALEO SA
- VARIOHM EUROSENSOR LTD.
- VISHAY PRECISION GROUP
The APAC IoT market is forecast to grow at a CAGR of 11.3% from USD 313.97 Billion in 2018 to USD 481.8 Billion in 2022.
The major challenges pricking the growth of the Asia-Pacific IoT market includes Deployment Challenges, Analytics Challenges and Scalability issues
The growth of the market is restrained by factors such as Data Privacy and Security Concern, Lack of seamless Interoperability, Compatibility and Longevity issues and Data Connectivity issues.
The growth of the Global Asia-Pacific market is augmented by Drivers such as Development of Wireless Networking Technology, Increase in cloud platform adoption, Advent of advanced data analytics and data processing and Reduction in cost of connected devices
- IoT - Internet of Things
- APAC - Asia-Pacific Countries
- USD - US Dollar
- CAGR - Compounded Annual Growth Rate
- RFID - Radio Frequency Identification
- IP - Internet Protocol
- SIs - System Integrators
- OT - Operational Technology
- AMI - Advance Metering Infrastructure
- IHD - In-Home-Displays
- LTE - Long-Term Evolution
- GPRS - General Packet Radio Services
- PLC - Programmable Logic Controllers
- RTU - Remote Terminal Unit
- POC - Proof of Concept
- ROI - Return on Investment
- MCOT - Mobile Cardiac Outpatient Telemetry
- GPS - Global Positioning Satellite