Apac set for 11.3% CAGR growth in IoT
August 21, 2018
The Asia-Pacific IoT market is expected to grow at a compounded annual growth rate of 11.3% between 2017 and 2022 to reach a market size of $95.7bn, according to Research & Markets.
The study has sized the spending across the entire IoT value chain comprising chips, modules and sensing, connectivity, enablement platform, system integration, and applications.
While the hardware and connectivity components are becoming increasingly commoditised and mature, industry players are seeking growth opportunities in system integration, application enablement platforms and application services.
While technology companies generally do not bring domain knowledge, they have been acquiring capabilities in vertical areas to provide vertical-specific services. Although acquisitions provide the greatest degree of control, it brings risk. Hence collaborations in the form of partnerships are the most common form of arrangement to gain expertise within a short period.
Government agencies in the Apac region are accelerating the deployment of large-scale IoT adoption via investments channelled towards IoT infrastructure, platforms and initiatives including standardisation. In the private sector, the transport, logistics and manufacturing sectors are key drivers of IoT spending.
Standalone internet-connected devices using cloud-based software via subscription models are increasingly popular to track and trace critical assets from a remote location. While the level of interest is high among the consumer and enterprise sectors, there is a general lack of willingness to spend on revamping the back-end infrastructure. To achieve higher RoI, SMEs are waiting for the technology to mature before they start to implement.
While all industries have been investing in IoT, certain industries are critical in driving adoption. In particular, sectors in transport and logistics, public safety, and power and utilities. While the use of technology is not a new phenomenon, the growth in adoption trend is driven by the increase in computing power over the past ten years. With cloud computing becoming more powerful, enterprises are able to capture a lot more data than before to get insights that were not possible in the past.
However, decision makers today still prefer to make decisions based on their past experience instead of using data. There is a fear that technology will render their skills and experience obsolete. Nevertheless, more and more decision makers are coming to terms that leveraging on the exponential increase in data is the way forward for enterprises to gain a competitive edge.