IoT in manufacturing market size is estimated to grow from $4.11B in 2015 to $13.49B by 2020, attaining a CAGR of 26.9%.
With the potential to streamline and deliver greater time and cost savings to a broad spectrum of enterprise tasks, opportunities for Internet of Things (IoT) adoption are proliferating. It’s encouraging to see so many industry-leading manufacturers, service providers, software and systems developers getting down to the hard work of making the vision IoT investments pay off. Forecasting methodologies shifted in 2015 from the purely theoretical to being more anchored in early adoption performance gains. Gil Press wrote an excellent post on this topic Internet of Things By The Numbers: Market Estimates And Forecasts which continues to be a useful reference for market data and insights, as does his recent post, Internet Of Things (IoT) News Roundup: Onwards And Upwards To 30 Billion Connected Things.
Key takeaways from the collection of IoT forecasts and market estimates include the following:
IoT-related value-added services are forecast to grow from $50B in 2012 to $120B in 2018, attaining a 15.71% CAGR in the forecast period. ABI Research’s forecast of the Machine-to-Machine (M2M)/Internet of Things value chain includes projected revenues and is part of an excellent analysis of the market by Woodside Capital Partners.
Cisco predicts the global Internet of Things market will be $14.4 trillion by 2022, with the majority invested in improving customer experiences. Additional areas of investment including reducing the time-to-market ($3T), improving supply chain and logistics ($2.7T), cost reduction strategies ($2.5T) and increasing employee productivity ($2.5T). The cited infographic also found that 50% of IoT activity today is in manufacturing, transformation, smart cities and consumer markets.
Cisco predicts the global IoT market will be $14.4T by 2022. Industry-specific use cases will generate $9.5T (66%) including smart grid, connected personal vehicles. Cross-industry use cases will generate $4.9T (34%) including future of work initiatives (telecommuting and collaboration technologies), and travel avoidance.
Software and services will be a $600B market by 2019, attaining a 44% CAGR from 2015 to 2019. BI Intelligence also predicts the number of devices connected via IoT technology will grow at a 35% CAGR from 2014 to 2019.
IC Insights predicts revenue from Industrial Internet of Things spending will increase from $6.4B in 2012 to $12.4B in 2015, attaining a 17.98% CAGR. IC Insights predicts the Industrial Internet will lead all five categories of its forecast, with Connected Cities being the second-most lucrative, attaining a 13.16% CAGR in the forecast period. The research firm segments the industry into five IoT market categories: connected homes, connected vehicles, wearable systems, industrial Internet, and connected cities. Source: IC Insights Raises Growth Forecast for IoT.
Manufacturing (27%), retail trade (11%), information services (9%), and finance and insurance (9%) are the four industries that comprise more than half the total value of the projected $14.4T market. The remaining 14 industries range between 7% percent and 1%. The following graphic based on Cisco’s analysis of the IoT market potential by industry and degree of impact. Cisco predicts Smart Factories will contribute $1.95T of the total value at stake by 2022.
Intel Capital, Qualcomm Ventures, Foundry Group, Kleiner Perkins Caufield & Byers (KPCB), Andreessen Horowitz, Khosla Ventures, True Ventures and Cisco Investments are the leading IoT investors this year. Intel Capital is investing in a broad base of IoT-related technologies, encompassing 3D body-scanning and biometric sensors, wearable sand IoT infrastructure startups.
Vodafone ’s latest Machine-to-Machine (M2M) study found that 37% of enterprises have projects targeted to go live in 2017. Vodafone defines M2M as technologies that connect machines, devices, and objects to the Internet, turning them into ‘intelligent’ assets that can communicate. M2M enables the Internet of Things. The following graphics compare M2M adoption trends from 2013 and 2015 and by industry.