Worldwide Spending on the Internet of Things Forecast to Reach Nearly $1.4 Trillion in 2021, According to New IDC Spending Guide
FRAMINGHAM, Mass., June 14, 2017 – A new update to
the International Data Corporation (IDC) Worldwide
Semiannual Internet of Things Spending Guide forecasts
worldwide spending on the Internet of Things (IoT) to
grow 16.7% year over year in 2017, reaching just over
$800 billion. By 2021, global IoT spending is expected to
total nearly $1.4 trillion as organizations continue to
invest in the hardware, software, services, and
connectivity that enable the IoT.
"The discussion about IoT has shifted away from the
number of devices connected," said Carrie MacGillivray,
vice president, Internet of Things and Mobility at IDC.
"The true value of IoT is being realized when the
software and services come together to enable the
capture, interpretation, and action on data produced by
IoT endpoints. With our Worldwide IoT Spending Guide,
IDC provides insight into key use cases where
investment is being made to achieve the business value
and transformation promised by the Internet of Things."
The IoT use cases that are expected to attract the
largest investments in 2017 include manufacturing
operations ($105 billion), freight monitoring ($50
billion), and production asset management ($45 billion).
Smart grid technologies for electricity, gas and water
and smart building technologies are also forecast to see
significant investments this year ($56 billion and $40
billion, respectively). While these use cases will remain
the largest areas of IoT spending in 2021, smart home
technologies are forecast to experience strong growth
(19.8% CAGR) over the five-year forecast. The use cases
that will see the fastest spending growth are airport
facilities automation (33.4% CAGR), electric vehicle
charging (21.1% CAGR), and in-store contextual
marketing (20.2% CAGR).
The industries making the largest IoT investments in
2017 are Manufacturing ($183 billion), Transportation
($85 billion), and Utilities ($66 billion). Cross-Industry
IoT investments, which represent use cases common to
all industries, such as connected vehicles and smart
buildings, will be $86 billion in 2017 and rank among the
top segments throughout the five-year forecast.
Consumer IoT purchases will be the fourth largest
market segment in 2017 at $62 billion, but will grow to
become the third largest segment in 2021. Meanwhile,
The industries that will see the fastest spending growth
are Insurance (20.2% CAGR), Consumer (19.4%), and
Cross-Industry (17.6%).
From a technology perspective, hardware will be the
largest spending category until the last year of the
forecast when it will be overtaken by the faster growing
services category. Hardware spending will be dominated
by modules and sensors that connect end points to
networks, while software spending will be similarly
dominated by applications software. Services spending
will be about evenly split between ongoing and content
services and IT and installation services. The fastest
growing areas of technology spending are in the
software category, where horizontal software and
analytics software will have five-year CAGRs of 29.0%
and 20.5%, respectively. Security hardware and software
will also see increased investment, growing at 15.1% and
16.6% CAGRs, respectively.
"As enterprises are adopting to new and innovative
services provided by different vendors a lot of new
threats are introduced, so it's very important to upgrade
existing security systems to ensure that an optimal
business outcome can be reached and ROI can be
justified," said Ashutosh Bisht, research manager for IT
Spending across APeJ.
Asia/Pacific (excluding Japan)(APeJ) will be the IoT
investment leader throughout the forecast with spending
expected to reach $455 billion in 2021. The second and
third largest regions will be the United States ($421
billion in 2021) and Western Europe ($274 billion).
Manufacturing will be the leading industry for IoT
investments in all three regions, followed by Utilities and
Transportation in APeJ and Western Europe, and
Transportation and Consumer in the United States.
Cross-Industry IoT spending will be among the leading
categories in all three regions as well. The regions that
will experience the fastest growth in IoT spending are
Latin America (21.7% CAGR), the Middle East and Africa
(21.6% CAGR), and Central and Eastern Europe (21.2%
CAGR).
The Worldwide Semiannual Internet of Things Spending
Guide forecasts IoT spending for 12 technologies and 54
use cases across 20 vertical industries in eight regions
and 52 countries. Unlike any other research in the
industry, the comprehensive spending guide was
designed to help vendors clearly understand the
industry-specific opportunity for IoT technologies today.
About IDC Spending Guides
IDC's Spending Guides provide a granular view of key
technology markets from a regional, vertical industry,
use case, buyer, and technology perspective. The
spending guides are delivered via pivot table format or
custom query tool, allowing the user to easily extract
meaningful information about each market by viewing
data trends and relationships.
For more information about IDC's Spending Guides,
please contact Monika Kumar at mkumar@idc.com.
About IDC
International Data Corporation (IDC) is the premier global
provider of market intelligence, advisory services, and
events for the information technology,
telecommunications, and consumer technology markets.
With more than 1,100 analysts worldwide, IDC offers
global, regional, and local expertise on technology and
industry opportunities and trends in over 110 countries.
IDC's analysis and insight helps IT professionals,
business executives, and the investment community to
make fact-based technology decisions and to achieve
their key business objectives. Founded in 1964, IDC is a
wholly-owned subsidiary of IDG, the world's leading
media, data and marketing services company that
activates and engages the most influential technology
buyers. To learn more about IDC, please visit
www.idc.com. Follow IDC on Twitter at and LinkedIn.
the International Data Corporation (IDC) Worldwide
Semiannual Internet of Things Spending Guide forecasts
worldwide spending on the Internet of Things (IoT) to
grow 16.7% year over year in 2017, reaching just over
$800 billion. By 2021, global IoT spending is expected to
total nearly $1.4 trillion as organizations continue to
invest in the hardware, software, services, and
connectivity that enable the IoT.
"The discussion about IoT has shifted away from the
number of devices connected," said Carrie MacGillivray,
vice president, Internet of Things and Mobility at IDC.
"The true value of IoT is being realized when the
software and services come together to enable the
capture, interpretation, and action on data produced by
IoT endpoints. With our Worldwide IoT Spending Guide,
IDC provides insight into key use cases where
investment is being made to achieve the business value
and transformation promised by the Internet of Things."
The IoT use cases that are expected to attract the
largest investments in 2017 include manufacturing
operations ($105 billion), freight monitoring ($50
billion), and production asset management ($45 billion).
Smart grid technologies for electricity, gas and water
and smart building technologies are also forecast to see
significant investments this year ($56 billion and $40
billion, respectively). While these use cases will remain
the largest areas of IoT spending in 2021, smart home
technologies are forecast to experience strong growth
(19.8% CAGR) over the five-year forecast. The use cases
that will see the fastest spending growth are airport
facilities automation (33.4% CAGR), electric vehicle
charging (21.1% CAGR), and in-store contextual
marketing (20.2% CAGR).
The industries making the largest IoT investments in
2017 are Manufacturing ($183 billion), Transportation
($85 billion), and Utilities ($66 billion). Cross-Industry
IoT investments, which represent use cases common to
all industries, such as connected vehicles and smart
buildings, will be $86 billion in 2017 and rank among the
top segments throughout the five-year forecast.
Consumer IoT purchases will be the fourth largest
market segment in 2017 at $62 billion, but will grow to
become the third largest segment in 2021. Meanwhile,
The industries that will see the fastest spending growth
are Insurance (20.2% CAGR), Consumer (19.4%), and
Cross-Industry (17.6%).
From a technology perspective, hardware will be the
largest spending category until the last year of the
forecast when it will be overtaken by the faster growing
services category. Hardware spending will be dominated
by modules and sensors that connect end points to
networks, while software spending will be similarly
dominated by applications software. Services spending
will be about evenly split between ongoing and content
services and IT and installation services. The fastest
growing areas of technology spending are in the
software category, where horizontal software and
analytics software will have five-year CAGRs of 29.0%
and 20.5%, respectively. Security hardware and software
will also see increased investment, growing at 15.1% and
16.6% CAGRs, respectively.
"As enterprises are adopting to new and innovative
services provided by different vendors a lot of new
threats are introduced, so it's very important to upgrade
existing security systems to ensure that an optimal
business outcome can be reached and ROI can be
justified," said Ashutosh Bisht, research manager for IT
Spending across APeJ.
Asia/Pacific (excluding Japan)(APeJ) will be the IoT
investment leader throughout the forecast with spending
expected to reach $455 billion in 2021. The second and
third largest regions will be the United States ($421
billion in 2021) and Western Europe ($274 billion).
Manufacturing will be the leading industry for IoT
investments in all three regions, followed by Utilities and
Transportation in APeJ and Western Europe, and
Transportation and Consumer in the United States.
Cross-Industry IoT spending will be among the leading
categories in all three regions as well. The regions that
will experience the fastest growth in IoT spending are
Latin America (21.7% CAGR), the Middle East and Africa
(21.6% CAGR), and Central and Eastern Europe (21.2%
CAGR).
The Worldwide Semiannual Internet of Things Spending
Guide forecasts IoT spending for 12 technologies and 54
use cases across 20 vertical industries in eight regions
and 52 countries. Unlike any other research in the
industry, the comprehensive spending guide was
designed to help vendors clearly understand the
industry-specific opportunity for IoT technologies today.
About IDC Spending Guides
IDC's Spending Guides provide a granular view of key
technology markets from a regional, vertical industry,
use case, buyer, and technology perspective. The
spending guides are delivered via pivot table format or
custom query tool, allowing the user to easily extract
meaningful information about each market by viewing
data trends and relationships.
For more information about IDC's Spending Guides,
please contact Monika Kumar at mkumar@idc.com.
About IDC
International Data Corporation (IDC) is the premier global
provider of market intelligence, advisory services, and
events for the information technology,
telecommunications, and consumer technology markets.
With more than 1,100 analysts worldwide, IDC offers
global, regional, and local expertise on technology and
industry opportunities and trends in over 110 countries.
IDC's analysis and insight helps IT professionals,
business executives, and the investment community to
make fact-based technology decisions and to achieve
their key business objectives. Founded in 1964, IDC is a
wholly-owned subsidiary of IDG, the world's leading
media, data and marketing services company that
activates and engages the most influential technology
buyers. To learn more about IDC, please visit
www.idc.com. Follow IDC on Twitter at and LinkedIn.
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