According to a new study by Grand View Research, growing VC investments by tech companies into innovative industry startups have further bolstered the growth opportunities in the market.
IoT connects devices such as consumer electronics as well as industrial equipment over a network, allowing information gathering and management of these devices via software to increase efficiency and enable new services.
Decreasing costs of internet enabled sensors, internet connectivity, and data processing are expected to propel industry growth. Additionally, futuristic concepts such as connected wearable devices, connected vehicles, connected homes, connected cities, and the Industrial Internet of Things (IIoT) are bound to open extensive market avenues over the next seven years.
However, issues such as privacy and security along with absence of universally accepted standards are expected to hamper the growth prospects. Moreover, increasing regulations by authorities in the U.S. and Europe in support of privacy and data security for the consumers are expected to challenge the industry.
Further key findings from the study suggest:
Devices segment comprising modules and sensors dominated the global IoT industry accounting for over 30% of the market share in 2014. Proliferation of innovative IoT platforms such as Brillo by Google Inc. and HomeKit by Apple Inc. has led competitors to develop and offer substitutes to the industry, thereby fueling segment growth.
Consumer electronics application segment is estimated to acquire a major segment of the revenue share in the IoT industry followed by retail and manufacturing. The development of the connected cars concept has pushed the transportation segment to acquire over 25% of the overall industry in 2014.
Asia Pacific is expected to grow at a CAGR close to 16% over the forecast period. Countries such as China, Japan, and India are expected to drive industry growth during the next seven years. Increasing penetration of high-speed broadband internet and the presence of major technology and component manufacturers such as Samsung and Huawei have led to the regional industry growth.
Technological and product innovations have driven the highly dynamic market. Key industry players include major technology and telecom giants such as Accenture PLC, Alcatel-Lucent, Apple Inc., Google Inc., General Electric, Freescale Semiconductors, IBM, Samsung Electronics, and SAP SE. Companies have aggressively fueled up investments in R&D and IoT divisions and innovation labs in order to gain on the first-mover advantage establishing their dominance in the market.