Servitization and Edge Analytics to Buoy 3X Growth in Industrial and Commercial IoT/M2M Gateways and Routers by 2021

London, United Kingdom - 03 Nov 2015

As the adoption of industrial IoT solutions grows, so does the demand for M2M/IoT gateways. In its latest report, ABI Research estimates that worldwide annual shipments of M2M/IoT gateway devices for commercial and industrial applications will grow at about 20% CAGR in the next six years, and exceed $1 billion revenues in 2021. Gateways are a fundamental component in many commercial and industrial M2M/IoT applications where they are deployed to provide local connectivity to the end nodes and perform network and protocol translation for communication with an enterprise network or a cloud environment.

Read ABI Research’s M2M/IoT Routers and Gateways: Technological Analysis and Market Evolution.

With hardware markets constantly battling pricing pressure and commoditization, more and more value in the IoT market will to be linked to software and services. “A growing number of OEMs complement their hardware portfolio with software platforms and cloud-based services,” says Eugenio Pasqua, Research Analyst at ABI Research. “These additions add value to their products while partnering with carriers, system integrators, application developers and service providers to offer their devices as part of an end-to-end solution rather than a stand-alone product. Market players like Cradlepoint, CalAmp, Sierra Wireless and Eurotech all provide their own software platforms to develop and deploy new applications and services on top of their gateways and facilitate and speed-up the creation of end-to-end solutions.”

Along with the huge growth of data generated by M2M and IoT solutions comes stringent requirements for tight security and real-time communication in many commercial and industrial applications. This is pushing the industry to shift from the traditional, cloud-centric M2M approach to a more distributed approach that creates an additional intelligence layer at the edge of the network where cloud functions could be performed locally.

“Several major companies, such as Cisco, Intel and IBM, are already adopting architectures based on a certain level of edge intelligence. We are beginning to see the more intelligent gateways that, when provided with more powerful processing and memory capabilities, can deliver these capabilities,” continues Pasqua. “Intel, in particular, has quite a compelling proposition in its Gateway Solutions for the IoT, an open architecture that has been already used by many OEMs like Eurotech, NEXCOM, Advantech and Dell. It has made the headlines in the past year with the release of intelligent gateways powered by powerful Intel Atom or Quark processors.”