IoT growth predictions abound from a variety of technology analyst firms and financial analysts. Most IoT growth predictions are hockey stick shaped projections – up and to the right.
The report includes the following IoT growth projections:
• Total number of IoT connections will grow from 6 billion in 2015 to 27 billion in 2025, a CAGR of 16 percent.
• Cellular connections will grow from 334 million at the end of 2015 to 2.2 billion by 2025. The majority of connections will be LTE. 45 percent of those cellular connections will be in the ‘Connected Car’ sector, including both embedded and aftermarket devices.
• China and the US will be the top Internet of Things competitors by 2025. China will account for 21 percent of global IoT connections, ahead of the US on 20, with similar proportions for cellular connections. However, the US wins in terms of IoT revenue (22 percent vs 19 percent).
• The total Internet of Things revenue opportunity will be USD3 trillion in 2025 (up from USD750 billion in 2015).
• By 2025, IoT will generate over 2 zettabytes of data, mostly generated by consumer electronics devices. However it will account for less than 1 percent of cellular data traffic.
The 27 billion IoT connections in 2025 will be driven by building automation and security (both commercial and residential), according to Matt Hatton, founder and CEO of Machina Research.
“Individually these devices don’t generate a whole lot of revenue. The big money tends to be generated by those sectors being connected by wide area connectivity, so particularly connected cars and industrial applications,” Hatton said.
IoT – from saving money to USPs
Close to half of companies (48 percent) are actively using IoT currently, according to Machina Research. “Historically it was about saving money or driving some other efficiency in an organization. Today it’s more about generating revenue and competitive differentiation, and increasingly so in future,” Hatton said.
The 3 trillion dollar revenue opportunity predicted by Machina Research while eye-popping in size, speaks to how the IoT is starting to include a lot of expenditures – and cost savings and revenue – on hardware/software that would have historically been classified as IT expenditures or cost savings, according to Hatton.
“IoT becomes a key competitive differentiator, the specifics of which will vary massively depending on the sector. Part of this will be about saving money, an increasing amount about generating revenue, and even more important it opens up potentially completely different business models that will be an absolute necessity,” Hatton said.