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IoT is no longer on the way. It’s here.
Internet of Things (IoT) technology has been steadily advancing in recent years. It has disrupted many conventional technologies and the number of IoT enabled devices/endpoints has breached the one billion mark. IoT endpoint electronics is expected to generate a revenue of $389 billion worldwide in 2020. It would be a reasonable assumption that practically every industry and every household would soon have IoT enabled devices and services in the foreseeable future.
IoT is no longer on the way. It’s here.
Businesses and industries which were reticent about integrating IoT into their technological model are slowly catching up. IoT technology disruptions have pioneered the growth of new, digital businesses. Gartner research has identified 5 key disruptive technology areas:
- Sensing: IoT endpoints
- Communicating: IoT communications
- Securing: IoT security
- Understanding: IoT data and analytics
- Acting: IoT Artificial Intelligence
Contents
- What is Gartner predicting about IoT?
- Home Security and Smart Metering Systems
- Fastest-growing sectors based on IoT endpoints
- How do the revenue streams generated by IoT endpoints look like?
- The top 10 Strategic IoT technologies and trends
- Looking ahead…
What is Gartner predicting about IoT?
Gartner, Inc. forecasts that the enterprise and automotive Internet of Things (IoT) market will surge to 5.8 billion endpoints in 2020, 21% higher than the 2019 total. As the leading manufacturers are making a paradigm shift towards IoT, the utilities market is expected to be the highest user of IoT endpoints. 1.37 billion endpoints are expected to be in use in 2020, a 17% increase from the 1.17 billion total in 2019.
Home Security and Smart Metering Systems
Home security and surveillance systems are rapidly advancing. From facial recognition to intruder recognition, these systems are instilling confidence in consumers and are robust and reliable.
Residential as well as commercial establishments are adopting electricity smart metering as a cost-effective and more accurate metering solution compared to the traditional metering systems. Smart metering systems will represent about 26% and 12% of the total IoT endpoints in Greater China and western Europe respectively in 2020.
Fastest-growing sectors based on IoT endpoints
The fastest-growing segment by far is Building Automation. With a staggering increase of 91% from 2018, the number of IoT endpoints in use will be 440 million this year compared to 230 million 2 years ago. Gartner predicts that building automation, driven by connected lighting devices, will remain the fastest-growing segment this year as well, with an impressive growth rate of 42%.
The next two fastest growers are expected to be the Automotive and Healthcare sectors, with a growth rate of 31% and 29% respectively.
IoT Endpoint Market by Segment, 2018-2020, Worldwide (Installed Base, Billions of Units)
| Segment | 2018 | 2019 | 2020 |
| Utilities | 0.98 | 1.17 | 1.37 |
| Government | 0.40 | 0.53 | 0.70 |
| Building Automation | 0.23 | 0.31 | 0.44 |
| Physical Security | 0.83 | 0.95 | 1.09 |
| Manufacturing & Natural Resources | 0.33 | 0.40 | 0.49 |
| Automotive | 0.27 | 0.36 | 0.47 |
| Healthcare Providers | 0.21 | 0.28 | 0.36 |
| Retail & Wholesale Trade | 0.29 | 0.36 | 0.44 |
| Information | 0.37 | 0.37 | 0.37 |
| Transportation | 0.06 | 0.07 | 0.08 |
| Total | 3.96 | 4.81 | 5.81 |
How do the revenue streams generated by IoT endpoints look like?
As mentioned earlier, 2020 will see an astonishing $389 billion in revenue generated from IoT endpoint electronics. North America, Western Europe, and Greater China will be the biggest markets with about 75% of the total revenue, with North America recording $120 billion, Greater China $91 billion and Western Europe in third with $82 billion in 2020.
Consumer connected cars totaling $72 billion and networkable printing and photocopying totaling $38 billion will generate the highest IoT endpoint electronics revenue. More and more leading automobile manufacturers are incorporating IoT technologies in their vehicles and are emphasizing on increased connectivity in a greater percentage of their vehicle production.
The printing and photocopying market shall slowly decline after 2020. With many Governments across the world focusing on public safety, IoT enabled surveillance systems will soon make up a significant portion of the IoT endpoint electronics revenue.
The top 10 Strategic IoT technologies and trends:
Gartner identified the top 10 trends that will shape the new era of digital business innovation.
Trend 1. Artificial Intelligence (AI):
Gartner forecasts 25 billion connected things to be in use by 2021, producing immense volumes of data. Data is the fuel that powers AI and AI will be applied to a wide range of IoT information, including video, still images, speech, network traffic activity, and sensor data.
Trend 2. Social, Legal and Ethical IoT:
The growth in IoT only means that legal and ethical issues about data privacy will arise and the social implications of this will be profound.
Trend 3. Infonomics and Data Broking:
A Gartner survey last year showed that 35% of the respondents were willing to sell the data obtained from their IoT products and services. The theory of infonomics takes this monetization of data further by seeing it as a strategic business asset to be recorded in the company accounts. By 2023, the buying and selling of IoT data will become an essential part of many IoT systems.
Trend 4. The shift from intelligent edge to intelligent mesh:
The shift from centralized and cloud to edge architectures is well underway in the IoT space. However, this is not the endpoint because the neat set of layers associated with edge architecture will evolve to a more unstructured architecture comprising of a wide range of “things” and services connected in a dynamic mesh. These mesh architectures will enable more flexible, intelligent and responsive IoT systems — although often at the cost of additional complexities.
Trend 5. IoT governance:
As the IoT continues to expand, the need for a governance framework that ensures appropriate behavior in the creation, storage, use and deletion of information related to IoT projects will become increasingly important.
Trend 6. Sensor Innovation:
New and more advanced sensors that can detect more events will be available in the market while the existing sensors will fall in price.
Trend 7. Trusted Hardware and Operating System:
Gartner surveys overwhelmingly show that one of the main concerns of organizations deploying IoT systems is Security. Organizations will strive for greater control which will culminate in new and more trustworthy hardware and software combinations.
Trend 8. Novel IoT user experiences:
UX designers will create new and improved designs that will enhance user experience and enable greater retention. The key factors fuelling this change shall be new sensors, new algorithms, and new edge architectures.
Trend 9. Silicon chip innovation:
Currently, the majority of the IoT devices use standard processors with the low-power ARM processors as the most popular choice. Going forward, newer and special-purpose processors will be used in IoT devices, designed for low power consumption and capable of running Deep Neural Networks (DNN).
Trend 10. New Wireless Networking Technologies for IoT:
IoT networking involves walking a tightrope between competing sets of requirements such as low power consumption, latency, bandwidth, range, and connection density. No single technology optimizes all of these parameters for IoT networking. Moving forward, 5G, in particular, can be explored as a viable IoT networking technology that optimizes all the important parameters.
Looking ahead…
The future is looking bright for the Internet of Things market. As consumers, one can expect every aspect of daily life to incorporate IoT in some form. As manufacturers, there will be stiff competition to come up with the best and most useful IoT devices. Our homes, cars, workplaces will all be smarter due to the hub of interconnected IoT devices. We are in the cusp of an exciting era of technological innovation.
