One problem with estimating the size of the internet of things market is that it is built out of existing parts of existing markets. Semiconductor content, software, appliances and devices, implementation and consulting services already enumerated elsewhere conceivably could also be counted as part of IoT spending.
For that matter, so can the cost of many enterprise information technology projects, when labor costs are allocated.
The bottom line is that all present IoT forecasts, and likely all forecasts for some time, will be subject to huge variations based on assumptions which must be made to separate out IoT spending, now or in five years.
The global IoT market will grow to $457 billion by 2020, at a compound annual growth rate of 28.5 percent, by some estimates, but is quite a bit larger if consumer wearables are included. In that case, current IoT spending exceeds $3 trillion, reaching $9 trillion by perhaps 2020.
Looking only at enterprise markets, and excluding consumer IoT, the enterprise IoT market might reach $6.7 trillion in 2020, if those projections are close to reality.
Discrete manufacturing, transportation and logistics and utilities will lead all industries in IoT spending by 2020, averaging $40 billion each, some predict.
Separately, Bain predicts business-to-business IoT segments will represent $300 billion annually by 2020, including about $85 billion in the industrial sector. For its part, Boston Consulting Group predicts the IoT market will reach $267 billion by 2020.
But by some estimates, IoT endpoints alone might represent nearly $3 trillion in annual sales by 2020, including consumer devices. Looking only at enterprise spending, possibly $1.5 trillion worth of enterprise IoT endpoints might be acquired in 2020.
IoT Endpoint Spending by Category (Millions of Dollars)
Category
|
2016
|
2017
|
2018
|
2020
|
Consumer
|
532,515
|
725,696
|
985,348
|
1,494,466
|
Business: Cross-Industry
|
212,069
|
280,059
|
372,989
|
567,659
|
Business: Vertical-Specific
|
634,921
|
683,817
|
736,543
|
863,662
|
Grand Total
|
1,379,505
|
1,689,572
|
2,094,881
|
2,925,787
|
Right now, our estimates are pretty rough.
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