[162 Pages Report] MarketsandMarkets forecasts the global Internet of Things market size to be USD 170.6 billion in 2017 and is expected to reach USD 561.0 billion by 2022, at a Compound Annual Growth Rate (CAGR) of 26.9% during the forecast period. The scope of the report covers the internet of things market by software solution, services, platform, application area, and regions. The software solution segment is further divided into real-time streaming analytics, security solution, data management, remote monitoring, and network bandwidth management. The application area segment is further segmented into Building and home automation, smart energy and utilities, smart manufacturing, connected logistics, smart retail, smart mobility and transportation.





MarketsandMarkets has helped one of the leaders in the Industrial Internet of Things (IIoT) industry to identify ~USD 8 million revenue potential by tapping into the IoT cloud platform market across North America, Europe, and Asia Pacific (APAC). Client�s Problem Statement The client, one of the leading vendors in the IoT ecosystem, was keen to understand the competitive landscape as well as the adoption rate of IoT cloud platform across North America, Europe, and APAC. The client also wanted to increase its market share and reach in the geographies mentioned above. Additionally, the client was interested to understand the impact of the COVID-19 pandemic on the IoT cloud platform ecosystem. MnM Approach MarketsandMarkets identified key disruptive technology trends that were changing the revenue mix of the client�s clients in end-use industries such as factory automation, smart rail, smart grid, and intelligent transportation, across North America, Europe, and APAC. MarketsandMarkets also interviewed a host of potential customers in these end-use industries to understand their unmet needs, possible use cases, and benefits from cloud-based IoT platform and what they looked for in an IoT technology partner.

This has helped the client identify the market potential and high impact use cases of IoT cloud platform across these end-use industries. MarketsandMarkets also helped the client to analyze the competitive landscape, varying business models, and strategies (organic and inorganic) of different players in the IoT cloud platform market. This helped the client devise a strategy-based product differentiation and form suitable alliances within the ecosystem to increase the market share.

MarketsandMarkets analysis and views on the impact of COVID-19 on the market, has helped the client to understand the changes in the short-term business strategy. Revenue Impact (RI) MarketsandMarkets� work resulted in the client tapping into a more than USD 6 billion market, with projected revenue of ~USD 8 million in three years. Consult our Analyst now

By Software Solution, the security solution segment is expected to grow at the highest growth rate during the forecast period

Smart devices connected to the internet enable unified connectivity with people, things, and networks. These seamless network connections create an efficient and customized user experience for both end-users and manufacturers. End-to-end security of IoT is critical for both device and network connection. However, growing network-connected device is threatening the IoT itself. These challenges comprise security aspects of various IoT-driven concepts such as smart city, logistics and transportation, healthcare, grid, water management, and building and manufacturing. IoT security threatens industries with cybercrime, privacy breaching, and infrastructural threats to enterprise, homes, and nation. Recently, in 2017, the world was hit by largest ever cybercrime WannaCry Ransomware attack, which compromised businesses, individuals, and government sensitive computer data files. This attack has exposed the shortcomings approach of the world to tackle cyberattacks. Such attacks create a great volume of risk for critical data, which leads to identity theft, network and device manipulation, and data falsification.

IoT security solutions provide governance and information security throughout the enterprise network during the attack. These solutions include network and data center, cloud, mobility and end-point solutions, content gateways, and access and policy management security to the enterprise. Companies such as GE, Gemalto, Trustwave, Cisco Systems, and Symantec provide solutions to protect IoT ecosystem from sophisticated and advanced threats.





By Platform, the device management segment to record the highest CAGR during the forecast period

The device management platform allows carriers and enterprises to manage IoT devices, apply security patches, set-up alerts, and provide device-centric reports using administrative tools. While using IoT devices, organizations require applications and platforms to manage information and devices. The deice management platform provides capabilities for device provisioning, remote access, configuration, administration, software management, device monitoring, and troubleshooting. The device manufacturers are increasingly adopting device management platforms to configure firmware via Firmware Over-The-Air (FOTA) or an Ethernet connection and remotely monitor, manage configurations, control settings, and automate software deployments. Every IoT system must address 4 fundamental categories of device management, namely, provisioning and authentication, configuration and control, monitoring and diagnostics, and software updates and maintenance. Any IoT product works on data acquired by sensors or machines, but between these sensors and the business applications, there is an infrastructure made of communication devices, routers, sim cards, operators, and fixed lines. Therefore, managing this infrastructure is essential to run the business processes properly. A major driver for the IoT device management platform is the growing requirement for the access and control over IoT devices.





North America to account for the largest market size during the forecast period.

North America is one of the largest contributors in the IoT space attributed to the factor that it is technologically developed. The US and Canada are the top contributing countries in the IoT market of this region. These countries have established economies, which empower them to strongly invest in R&D activities. Moreover, the start-up culture in North America is growing more rapidly in comparison to the other regions. Rapid digitalization across industry verticals, increasing adoption of smart connected devices, and technological advancements have further fueled the growth of IoT in this region.

In 2016, the US Senate unanimously passed the �Developing Innovation and Growing the Internet of Things (DIGIT) Act.� Under this act, a working group of federal and private sector representatives was formed to identify the regulations and practices related to adoption and development of IoT. Moreover, the committee has to plan a regulatory environment for things such as privacy, protection, and security. This act further opened the lines of communication between the private and public sector to capitalize on developing the technology.

IoT has seen vast application around different industries in the US. For instance, Lineage Logistics, a warehouse and storage company in the US collaborated with Monnit Corporation for IoT-enabled sensors. Monnit Corp. provided Lineage Logistics with IoT temperature and vibration sensors. The temperature sensors were used to ensure that all parts of the warehouse stayed at the desired temperature, and the vibration sensors were deployed to monitor refrigeration problems by measuring vibration magnitude and vibration count. This project helped to protect warehoused food and to optimize energy cost.

The US educational institutions are also incorporating IoT solutions for student�s safety and better utilization of time. For instance, the Watkins Glen Central School District deployed Cisco�s digital solution. This institute equipped its school buses with �Cisco�s 829 industrial integrated service routers� for the management of vehicles and optimized operational efficiency and reduced the risk of downtime with �Smart Net Total Care Service.� Similarly, the Alaska Department of Transportation deployed IoT solution to manage secure radio channels, coordinate dispatching, and provide network connectivity on roadways. This helped them to broaden their reach and improve responsiveness. Moreover, it equipped them with better asset management.

Similarly, Daimler Trucks deployed the IoT solution for improved agility and scalability to support its production needs. The deployed wireless connectivity was used by employees and machines to be connected all over the manufacturing unit. This shared network helped the management to be connected with the process. Moreover, the solution provided robust and standard based cyber security to the company.

After the US, Canada holds the major share in the IoT space in North America. The growth of IoT is attributed to factors such as high rate of cloud adoption, low cost of business operations, and highly skilled workforce. The Canadian companies are improving and optimizing their business processes by utilizing IoT capabilities. Moreover, the companies are manufacturing and selling IoT infrastructure for optimization of businesses. For instance, Miovision Technologies, a Canadian infrastructure company, is developing a data network using a grid of internet-connected traffic signals to link infrastructure wirelessly. This data is being used to optimize the traffic flow. Moreover, Rogers Communication, a Canadian communication and media company, signed an agreement with blueRover, a Canadian technology company. This agreement was signed to offer solutions for food and farm monitoring. The sensors were installed for monitoring of equipment throughout the food production chain and the real-time information led to waste reduction and process optimization.

Market Dynamics

Driver: Development of wireless networking technologies

Over the years, wireless technologies have advanced from hypothetical observations to a readily applied science that plays a major role in many aspects of modern life. These technologies include Wi-Fi, Bluetooth, ZigBee, Z-Wave, Insteon, and Digital Enhanced Cordless Telecommunications (DECT). Peer-to-peer solutions such as AllSeen, DLNA, and UPnP are also witnessing accelerated development, and allow direct device-to-device communication. A growing number of wireless technologies now enable communication among devices. This increase in connectivity will lead to a larger base of individuals interested in purchasing IoT devices. High-speed network connectivity has created many new options in organizations across industry verticals. The advancement in high-speed wireless network technology and the number of devices enabled with this technology are increasing rapidly. LTE is the modern high-speed wireless communications standard for mobile phones and data terminals, which support 4G services. It is easily deployed and optimizes network connectivity by using separate radio links for the device-to-tower uplink and tower-to-device downlink. LTE is important because it enables more efficient use of the ever-limited spectrum available to connect low-power IoT devices with back-end systems. Additionally, the introduction and evolution of IPv6 is driving the demand for connected technologies in organizations. The deployment of the IPv6 addresses will have a positive impact on IoT connected devices. Moreover, an additional feature that IPv6 has is that the IPv6 makes the management of networks easier due to auto-pattern capabilities and provides advanced security and privacy measures.

Restraint: Data security and privacy concerns

As the IoT becomes more widespread, enterprises demand better security and privacy protections that do not leave them vulnerable to corporate surveillance and data breaches. With the increase in the number of IoT-enabled systems, a number of security and privacy issues will arise and every endpoint, gateway, sensor, and smartphone will become a potential target for hackers. The most dangerous part of the IoT ecosystem is that enterprises are surrendering their privacy, bit by bit, without realizing it, because they are unaware of what data is being collected and how it is being used. In many enterprises business processes, IoT devices measure variables such as speed, pressure, consumption, and temperature and actuators control physical systems, such as brakes, valves, lights, power circuits, or automated drug dispensers. What makes these applications interesting from a security and privacy perspective is that they all affect the physical world, sometimes controlling critical infrastructure and sometimes gathering very private information about different operations and smart equipment. Clearly, there is a need for IoT security and privacy protection in the enterprise as some of the devices used in the IoT have extremely limited memory, processing capacity, and battery power; consequently, classical IT security mechanisms are often inadequate to cope with the unique security situations that arise. Privacy protection, on the other hand, depends largely on individual users to understand and configure security settings. This often requires a high level of IT security competence and is therefore likely to fail more often. Addressing this issue would greatly improve the public acceptance of IoT consumer products. Enterprises can self-regulate by developing and adopting industry-wide best practices on cybersecurity and data minimization. When organizations collect user data, they must take responsibility for protecting their users; if they do not want to be responsible for the data, they should refrain from collecting it in the first place.

Opportunity: Potential growth opportunities for system integrators

A lucrative opportunity for IoT vendors exists in the form of creating an integrated and embedded IoT solution that encompasses hardware, software platforms, security needs, and cloud platform within a single console. Currently, every solution needs to be installed, managed, and maintained differently by system integrators. The IoT market is quite fragmented and involves various intermediaries, starting from traditional chip makers to system integrators. Consolidated IoT solutions would solve a majority of these issues, where opportunities exist for manufacturers and system integrators to design flexible platforms by minimizing complexities that arise around various sensors, processors, and software to deliver simpler user experience to the end-users. System integrators bind all component subsystems into a whole and deliver to the retailers. Moreover, 30% of the value in this market is driven by services that have huge opportunities for all types of systems integrators, such as major IT vendors, infrastructure vendors, IT consultants and integrators, and various independent local integrators. As the adoption rate of IoT increases, their role in the IoT value chain increases, thereby opening lucrative opportunities for them.

Challenge: Data migration from legacy systems

Migrating any company�s critical business data to new storage technology or a new location can be a complex, time-consuming, and risky undertaking. Data migration is a key component to consider when adopting any new system, either through integrating with new system or new development. Migrating data from legacy source systems to new systems and the resources consumed in this migrations process increase the operational cost of an organization. In order to avoid a big migration problem, all data is divided in several logically separated groups called data groups that can be processed serially. In migration environment, the data is processed in such a manner that it could be almost without any change moved to the new application database. During migration analysis, all validations and transformations are identified and uniquely ordered for each data group. All migration is done in PL/SQL packages. Generally, one package is created for each data group and one procedure for one or more validation and transformation. Data migration causes serious issues if system design and process collaboration is not carried out properly, business rules are interpreted incorrectly, and data standardization is not followed. It is difficult to transfer unstructured data, as it has to be cleaned and reviewed before processing. The main issue that arises during the migration of data is the implementation process that should be completed within specified deadline, and proper care should be taken to eliminate the risks associated with it. It is surveyed that most of the data migration projects suffer from implementation delay. Maintaining data quality is also an important issue in data migration, hence a lot of planning is involved before commencing the data migration process.

Scope of the Report

Report Metric Details Market size available for years 2015�2022 Base year considered 2016 Forecast period 2017�2022 Forecast units Billion (USD) Segments covered Software Solution (Real-time streaming analytics, Security solution, Data management, Remote monitoring, and Network bandwidth management), Professional Services (Consulting, Deployment, & Support), Managed Services, Platform (Device Management, Application Management and Network Management), Application Area (Building and home automation, smart energy and utilities, smart manufacturing, connected logistics, smart retail, connected health, smart mobility and transportation, Others) and Region Geographies covered North America, Europe, APAC, MEA, and Latin America Companies covered Intel Corporation (US), SAP SE (Walldorf, Germany), Cisco Systems, Inc. (US), Microsoft Corporation (US), Oracle Corporation (US), International Business Machine (IBM) Corporation (US), PTC Inc. (US), Google Inc. (US), Hewlett-Packard Enterprise (US), Amazon Web Services Inc. (US), Bosch Software Innovation GmbH (Stuttgart, Germany), and General Electric (US).

The IoT market considers software solution, service, platform, application area and regions to arrive at the global market size of the IoT market during the forecast period.

By Software Solution

Real- time Streaming Analytics

Security solution

Data management

Remote monitoring system

Network bandwidth management

By Platform

Device management

Application management

Network management

By Service

Professional service

Deployment and integration

Support and maintenance

Consulting service

Managed service

By Application Area

Building and home automation

Smart energy and utilities

Smart manufacturing

Connected logistics

Smart retail

Smart mobility and transportation

Others

By Region

North America

Europe

Asia Pacific (APAC)

Middle East and Africa (MEA)

Latin America

Key Market Players

Intel Corporation (US), SAP SE (Walldorf, Germany), Cisco Systems, Inc. (US), Microsoft Corporation (US), Oracle Corporation (US), International Business Machine (IBM) Corporation (US), PTC Inc. (US), Google Inc. (US), Hewlett-Packard Enterprise (US), Amazon Web Services Inc. (US), Bosch Software Innovation GmbH (Stuttgart, Germany), and General Electric (US).

The IoT market segment of Intel is expanding significantly with growing adoption of smart and connected devices by the commercial clientele. The IoT segment is a dense market in terms of competitors. Hence, the company focuses on client requirements by offering a broad range of connectivity and wireless solutions, such as cellular, Wi-Fi, and Bluetooth. A broad portfolio of solutions and services also differentiate the company�s strategy. Since Intel is expanding vertically, the inorganic strategy has evolved its business model and IoT platform computing solutions. Intel invests heavily in developing innovative solutions through its R&D and therefore, involves capitalizing on its core businesses in which it has competitive advantage and domain expertise. During 2014, 2015, and 2016, Intel invested approximately 20.6%, 21.9%, and 21.5%, respectively, of the total revenue in R&D. Intel data center and IoT businesses make 40% of its total revenue and have become Intel�s primary growth engines, since it helped the company to create USD 2.2 billion in revenue growth in 2015, in spite of the decline in the PC market.

Microsoft offers products as business solutions for resource and financial management, customer relationship management, logistics and supply chain management, and analytics applications for SMEs and medium enterprise businesses, across the global. The company has built its strategy with a focus on intelligent cloud platform, more personal computing, and enhancing productivity service and business process. The productivity services aim to offer �mobile-first and cloud-first world� which would make technology interaction with organizations and individuals easy. Microsoft offers Azure IoT Suite, which uses Microsoft cloud platform with computing, networking, storage, database, and management. Along with advanced analytics services, it allows businesses to run through a secure, fast, less expensive solution and gain the benefits of IoT for their business. Furthermore, Microsoft dominates the OS and office suite market as it offers a series of Windows OS, Internet Explorer, and Microsoft Office suite. Therefore, it makes commercial licensing an important segment for Microsoft, which generates a large chunk of revenue for the company. However, it has become a challenge for the company to secure its intellectual property rights and proprietary information. Microsoft has 57,000 patents registered in the US and internationally, and around 35,000 patents are still pending for clearance.

Recent Developments

In April 2017, Microsoft announced the launch of Azure IoT suite for connected factory preconfigured availability. This Azure suite is a 6-step framework solution, designed to help businesses operate at their maximum efficiency. Azure IoT suite for Industrie 4.0 has cloud-enabled equipment for industry, which could be seamlessly integrated with the existing machine. The suite offers the ability to manage equipment remotely and without disturbing operations.

In February 2017, Oracle partnered with Huawei to form a "Power IoT Ecosystem." According to the agreement, Oracle's Utilities Meter Data Management (MDM), Utilities Smart Grid Gateway (SGG), and other Utilities products, along with Huawei's AMI solution, would be cooperating in marketing and sales operation. This would allow both companies access to each other�s client base, which would help in further R&D process.

In February 2017, IBM Corporation partnered with Visa, an American multinational financial services corporation. This partnership enabled IBM to combine its Watson IoT platform with the token technology of Visa, which allows devices to conduct commerce on customer�s behalf. Visa and IBM have deployed a token sharing architecture through a device that is managed by Big Blue's cloud infrastructure.

In September 2016 Microsoft launched Azure services in India, becoming the first public cloud provider in the country by establishing 3 data centers in Mumbai, Pune, and Chennai. These local data centers would be responsible for increasing flexibility and scalability and reducing the time-to-market for partners and customers.

Critical questions the report answers:

Where will all these developments take the industry in the long term?

What are the upcoming trends for the Internet of Things market?

Which segment provides the most opportunity for growth?

Who are the leading vendors operating in this market?

What are the opportunities for new market entrants?

To speak to our analyst for a discussion on the above findings, click Speak to Analyst