According to Gartner, the Internet of Things (IoT) concept, which excludes PCs, tablets and smartphones, will reach 26 billion installed units in 2020 witnessing a 30-fold increase from 0.9 billion installed units in 2009.
IoT product and service suppliers will generate incremental revenue of over $300 billion in 2020. This will contribute to $1.9 trillion in global economic value-add through sales into diverse end markets. The growth in IoT will far exceed that of other connected devices. By 2020, the number of smartphones, tablets and PCs in use will reach about 7.3 billion units. In contrast, the IoT will have expanded at a much faster rate, resulting in a customer base of about 26 billion at the end of the forecast period.
Due to the low cost of adding IoT capability to consumer products, Gartner expects that ‘ghost’ devices with unused connectivity will become common. This will be a combination of products that have the capability built in but require software to ‘activate’ it and products with IoT functionality that customers do not actively leverage. In addition, enterprises will make extensive use of IoT technology, and a wide range of products will be sold in various markets, such as advanced medical devices; factory automation sensors and applications in industrial robotics; sensor motes for increased agricultural yield; and automotive sensors and infrastructure integrity monitoring systems for diverse areas, such as road and railway transportation, water distribution and electrical transmission.
Gartner states that by 2020, component costs will have come down to the point that connectivity will become a standard feature, even for processors costing less than $1. This further opens up the possibility of connecting any devices to offer remote control, monitoring and sensing.
The IoT encompasses hardware (the things themselves), embedded software, communications services and information services associated with the things. Gartner refers to the companies that provide the hardware, software and services as IoT suppliers. The incremental IoT supplier revenue contribution from IoT in 2020 is estimated at $309 billion. The verticals leading the adoption of IoT include manufacturing (15 per cent), healthcare (15 per cent) and insurance (11 per cent).
Increasing adoption of IoT will lead to improved safety, security and loss prevention in the insurance industry. IoT will also facilitate new business models, such as usage-based insurance calculated based on real-time driving data. The banking and securities industry will continue to innovate around mobile and micropayment technology using convenient point-of-sale terminals and will invest in improved physical security systems. IoT will also support a large range of health and fitness devices and services, combined with medical advances, leading to significant benefit to the healthcare sector. Emerging connected sensor technology will lead to value creation in utilities, transportation and agriculture.
Most industries will also benefit from the generic technologies, in that their facilities will operate more efficiently through the use of smart building technology.
