The Internet of Things (IoT) will be a $150 billion market this year, growing to $550 billion in 2025, according to research firm Strategy Analytics (SA).
By SA’s count, IoT will represent a $3.5 trillion market cumulatively from 2016 to 2025. The total IT market is currently worth about $4 trillion, which is expected to grow to $41 trillion by 2025 with the introduction of IoT to the market, according to SA’s report. However, SA says that it is skeptical of some analysts’ projections that IoT will create trillions of dollars of new spending.
SA defines IoT as a system for collecting sensor-based information, transporting it over the Internet, storing the information in a database, and potentially using the analytics to yield valuable information. This definition excludes machines that don’t use sensor data or the Internet.
Mobile phones are currently the largest category of connected devices but will be surpassed by IoT in 2018, according to Ericsson’s latest Mobility Report. The report says that by 2021, more than half of connected devices will pertain to IoT.
Interestingly, Ericsson defines two major markets within IoT: Massive IoT connections and Critical IoT connections.
Massive IoT connections are distinguished by high connection volumes, low cost, low energy, and small data traffic volumes. This will improve the presence, security, and management of of cellular networks.
On the other hand, Critical IoT connections are characterized by ultra-reliability and availability with high proficiency. Lower cost LTE modules will allow for an increase in new, very low latency applications.
SA also expects IoT to have a positive impact on total corporate IT spending by cutting costs and adding value over time. Much of the IoT market potential may already be captured in other projections for the cloud, big data analytics, and system integration activities.