Market Overview

Developments in Sensor Technologies and Communication Devices to Aid the Global IoT Market Post a CAGR of Nearly 36% Until 2020, Reports Technavio

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LONDON--(BUSINESS WIRE)--

Technavio analysts forecast the global IoT market to grow at a CAGR of close to 36% during the forecast period, according to their latest report.

The research study covers the present scenario and growth prospects of the global IoT market for 2016-2020. The report categorizes the market into the following end-user segments: manufacturing, retail, healthcare, ICT, and others. The manufacturing segment was the largest end-user market in 2015 with approximately 27% market share.

Technavio ICT analysts highlight the following four factors that are contributing to the growth of the global IoT market:

  • Realization of potential benefits by businesses and governments
  • Favorable support from governments
  • Developments in sensor technologies and communication devices
  • Increased Internet connectivity

Realization of potential benefits by businesses and governments

With the ever-increasing number of devices, the capacity to manage, monitor, and maintain data in an organization becomes increasingly difficult. As a result, the demand for M2M and machine-to-human (M2H) communication is increasing as it helps end-users simplify the management, monitoring, and maintenance of connected devices.

Also, the rise in the number of connected devices in multiple industries has led to massive data generation. Businesses are making use of these data through analytics to optimize costs, enhance delivery services, and boost revenues. They are realizing the opportunities to change business models. For example, aviation engine manufacturers now offer an inclusive rental program for their equipment and servicing. The expectation is that the feedback from engine users will likely enhance their design and reduce manufacturing and maintenance costs, which leads to a significant competitive advantage.

Amit Sharma, a lead analyst at Technavio for research on IT professional services, says, "Companies are introducing automation and flexible production techniques in manufacturing to enhance productivity. Along with this predictive asset maintenance helps companies to save money on scheduled repairs, reduce maintenance costs, and eliminate the occurrence of sudden breakdowns."

Favorable support from governments

Favorable support from governments and growing industrial pressure for digital transformations of traditional industries to enhance business productivity and gain competitive advantage have resulted in increased adoption of IoT worldwide.

The European Union's 7th Framework Programme for Research and Technological Development has funded more than USD 145 million in research and innovation related to IoT projects. Also, Europe's Horizon 2020 supports a series of IoT large-scale pilots in the areas of assisted living, wearables, connected vehicles, smart agriculture, smart cities, and water management. Germany's Industry 4.0 aims to encourage digitalization of traditional industries in Germany. The German government plans to invest USD 221.9 million in the industrial Internet projects. Initiatives taken by the German government should boost the country's cumulative GDP and this will have a major impact on its economic growth.

Developments in sensor technologies and communication devices

Advances in technology related to sensors and innovations in material sciences have led to proliferation of different types of sensors. This has increased the availability and affordability of sensors for all industries to consume. These sensors are in high demand due to their advantages, such as low power consumption and prices. As a result of the automation of several processes in industries, IT has become an integral part of industrial automation. As industries embrace IoT, opportunities for IT players continue to expand.

"In an industrial Internet setup, sensors help achieve enterprise mobility, remote monitoring, and remote controlling of systems. All these pave the way for significant cost savings and boost revenues. Therefore, as more industries worldwide embrace different types of sensors, enabling IoT becomes a high possibility," states Amit.

Increased Internet connectivity

According to a 2015 report by the International Telecommunication Union, a UN agency, the number of people using the Internet is on a rise. About half of the world's population used Internet in 2015, thus reaching 3.2 billion.

The Internet revolution is fueling ubiquitous connectivity by bringing unconnected devices on the network. The network technology has evolved to meet the needs of different applications. Such technologies provide an effective communication infrastructure for the rapid pace of communication among Internet-enabled devices at high speed.

The scope of Internet use has been extended due to the increased interconnection of sensors with consumer devices and other physical assets. IoT enables data collection, processing, and sharing with end-users. It finds application in industries such as healthcare, manufacturing, transportation and logistics, energy and utilities, and other services.

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About Technavio

Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.

Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.

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Technavio Research
Jesse Maida
Media & Marketing Executive
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www.technavio.com

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