- Opportunity for revenue growth biggest factor driving IoT adoption.
- Data monetization cited as top IoT revenue growth driver, but only 8% of businesses are using more than 25% of their IoT data.
- Consumers expect their smartphones to do more in an IoT-enabled world
- Simplified tools for developers and pending regulatory changes drive IoT
New York – With an addressable market that includes more than 150 million cars that are not currently connected, over 300 million utility meters, nearly 1 million vineyard acres and 45 million people sharing goods and services* in the US alone, the Internet of Things (IoT) is now mainstream according to a new report released today by Verizon. Titled “State of the Market: Internet of Things 2016,” the report includes insights from an Oxford Economics study commissioned by Verizon among other new findings.
Throughout 2016 and beyond, Verizon’s experts say that IoT will continue to be a revenue driver for businesses both large and small due to the confluence of five macrotrends:
- Consumers appreciate their smartphones, but in an IoT-enabled world, they are starting to understand and expect that their phones can do more. In 3 to 5 years, average consumers will experience a much higher level of automation in their daily lives thanks largely to the ability to engage with IoT applications through a more simplified interface. In fact, today, 81 percent of IoT adopters in the public sector believe that their citizens increasingly expect them to offer enhanced services from data and IoT.
- Data monetization will become a required competency. Nearly 50 percent of businesses expect to be using more than 25 percent of their data over the next 2 to 3 years. Data analytics will evolve from descriptive data collection to a more sophisticated model of predictive and prescriptive data analytics and as industries seek to derive meaningful insights to benefit their customers, there will be a paradigm shift from “big data” to domain experts.
- Changes in the regulatory landscape will continue to bring the right ecosystem partners together to help establish industry standards more quickly.
- Consider the Drug Supply Chain Act, which gives drug manufacturers until late 2017 to implement systems to electronically transfer and store transaction histories for their prescription drugs including shipment information across their distribution and supply chain. The law is designed to thwart counterfeit drugs which cost the industry $75 billion annually according to the World Health Organization.
- Network connectivity, low power devices and IoT platforms will democratize innovation by creating more tools for developers and enabling businesses to scale their IoT deployments from millions to billions of connections more cost-efficiently.
- 5G, the next-generation of wireless technology, not only promises to make autonomous solutions such as cars and robotics a reality, but will also usher in new categories of uses cases, such as virtual and augmented reality for IoT deployments.
- Security experts are keeping up with the development of technology by looking to arising threat vectors – some old, some new – that will impact IoT deployments and ongoing operations.
The report also highlights that enterprises are turning to startups to help accelerate their IoT growth. In 2015, enterprise IoT startup companies outpaced funding for consumer startup companies by 75 percent. Verizon’s experts say that enterprise IoT startup companies will raise two to three more times in capital in 2016 compared to their consumer IoT counterparts.
“The view has been that IoT is a mashup of complex technologies used only by early adopters,” said Mike Lanman, senior vice president IoT and Enterprise Products at Verizon. “In the past year, we’ve seen compelling examples of how IoT is being deployed by a wide-range of enterprises, entrepreneurs, municipalities and developers to address relevant business, consumer and public needs. Meanwhile, consumers are more willing to try new technologies and apps that introduce a better way of life. The end result will not only give rise to thousands of new use cases over the next two years, but will also create an accelerated pipeline for innovation and a new economy.”