IoT markets

Disparate levels of adoption in vertical markets

by Samuel ROPERT

The IoT market is developing through vertical industries, albeit in a very uneven fashion as adoption levels vary depending on use case. Today’s key vertical sectors are utilities and automotive, spurred by regulation and public policies around the globe. Future opportunities are also opening up in the logistics and health sectors.

A growing but still very disparate market

The number of connected objects in use worldwide is expected to reach 6.5 billion units by 2025.

Utilities will remain the biggest market with 2.1 billion units in 2025, followed by the automobile industry. Logistics also has solid growth prospects, notably thanks to LPWAN technologies, with asset tracking as its killer app.

Short-range wireless (Wi-Fi, Bluetooth) are still the most widely used technologies, chiefly due to the consumer market for connected household and wellness products.

With heavyweight China as a main driving force, Asia-Pacific will account for the bulk of the market (54% of all connected objects), followed by Europe. The fastest growing region is Africa/Middle East, posting average annual increases of 64% over the next five years.

Asia-Pacific driving IoT growth (Regional distribution of connected objects worldwide)

2018

2023

Source : IDATE DigiWorld in "LPWAN IoT Markets"

IoT, a pillar of the industrial transformation

Today, an IoT solution is installed in the original equipment and integrated into the final product, and the service provided by that product’s manufacturer. This enables the manufacturer to accelerate its strategy of transitioning into selling services (in addition to selling the goods, or instead of). Solutions providers tend to specialise when it comes to replacement items, typically marketing an end-to-end solution.

In the connectivity segment, telecom operators market dedicated solutions for the different vertical industries, with very modular plans, which can entail including the service as part of a complete solution, as a way to stem the decline in connectivity ARPU.

A host of players have positioned themselves in the key IT services platform segment, but IaaS solutions providers, such as Microsoft and AWS, are proving the most successful.

Industry players' growing focus on selling services

GM's changing strategy

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Source : IDATE DigiWorld

LPWAN enabling new smart farming applications

Snapshot of technical solutions in the smart farming crops segment

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Source : IDATE DigiWorld in "Smart Farming"

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