How much is being spent on IoT, and in what sectors?
IDC’s update to its Worldwide Semiannual Internet of Things Spending Guide, forecasts that U.S. organisations are due to invest more than $232 billion in IoT hardware, software, services, and connectivity this year and IoT revenues will return a compound annual growth rate of 16.1 per cent over the 2015-2019 forecast period.
That means that by 2019 the US spend will have reached more than $357 billion.
The industries leading the way in are Manufacturing and Transportation at $35.5 billion and $24.9 billion, respectively, in 2016. However, What IDC calls Cross-Industry investment - the sorts of almost generic use-cases which could be applied across all industries, will approach $31 billion this year. The IoT use cases receiving the greatest levels of investment from U.S. organisations across these three industry segments are:
- Manufacturing Operations: supports digitally-executed manufacturing, where manufacturers use intelligent and interconnected I/O (input output) tools – sensors, actuators, drives, vision/video equipment – to enable the different components in the manufacturing field to autonomously exchange information, trigger actions and control each other independently.
- Freight Monitoring, which uses radio frequency identification (RFID), global positioning system (GPS), GPRS, and GIS technologies to create an intelligent, Internet-connected transportation system. This system carries out the intelligent recognition, location, tracking and monitoring of freight and cargo through exchanging information and real-time communications via wireless, satellite or other channels.
- Smart Buildings, which utilize advanced automation and integration to measure, monitor, control, and optimize building operations and maintenance. The key concept is optimization – meaning the deployment of a set of integrated control systems capable of adapting in real time to both internal policies and external signals. These systems manage how building equipment operates to use energy in the most efficient and cost-effective way.
The next three largest IoT use cases will be Remote Health Management, Smart Grid (Electricity), and Smart Home. The IoT use cases that will experience the greatest revenue growth in the U.S. over the 2015-2019 forecast period are In-Store Contextualized Marketing, Connected Vehicles, and Insurance Telematics.
While Manufacturing and Transportation will lead the U.S. in terms of overall IoT investments, the Insurance, Retail, and Healthcare industries will see IoT spending levels increasing by 135%, 101%, and 96%, respectively, over the forecast period. In addition to driving some of the largest IoT investments, the Cross Industry segment will also see revenue growth of more than 100% through 2019, says IDC.