Spending on the Internet of Things (IoT) will grow at a 17 percent compound annual growth rate (CAGR) to nearly $1.3 trillion in 2019 from $698.6 billion in 2015.
More than 40 percent of the worldwide IoT spending will be in Asia Pacific region in 2015. North America and Western Europe will be spending more than $250 billion in 2015, less than one third of the total IoT spending.
Latin America (26.5 percent CAGR), followed by Western Europe, and Central and Eastern Europe will record the fastest growth in IoT spending over the five-year forecast period.
Developing countries’ technology investment needs are not fully met with traditional IT, which is allowing IoT investments to accelerate.
“Government investments in infrastructure development and local business modernization, in China, India and the Philippines are incorporating IoT elements; and a burgeoning new consumer class is accelerating expenditures in goods and services, including those with IoT components,” said Marcus Torchia, research manager, Internet of Things at IDC.
Manufacturing sector will be spending $165.6 billion on IoT.
Transportation industry will be spending $78.7 billion on IoT.
Insurance (31.8 percent CAGR), Healthcare, and Consumer will have the fastest IoT spending growth over the next five years, while consumer IoT market will be the third largest IoT spending category by the end of the forecast period.
“Manufacturing and transportation industries have been connecting their supply chains, products, customers, and workers for some time now, and really embrace the value of business outcomes,” said Vernon Turner, senior vice president and IoT research fellow at IDC.
In Central & Eastern Europe and the Middle East & Africa (MEA), the fastest growing IoT category is smart buildings, where IoT technology that utilizes advanced automation and integration is being used to measure, monitor, control, and optimize building operations and maintenance.
In Latin America, the fastest growing IoT category is maintenance and field service, where service data is automatically measured, recorded, and transferred remotely from the field for monitoring and use by technicians.
In Asia Pacific, insurance telematics is being used to monitor driver behavior through a vehicle-mounted device and the data is rapidly being employed as a means of determining insurance policies and rates.
In North America, in-store contextual marketing is growing rapidly as retailers seek to capture continuous, real-time streams of data from mobile devices, online customer activity, in-store Wi-Fi routers/beacons, and video cameras in order to gain insight into customer behavior and desires.