Total IoT spending in APAC to reach US$58bil by 2020
Malaysia, Thailand and Indonesia among fastest growing from 2014-2017
FROST & Sullivan’s latest report, Analysis of The Internet of Things Market in Asia Pacific, expects The Internet of Things (IoT) market to be one of the fastest growing segments in the Asia Pacific technology industry.
Total Asia Pacific spending on Internet of Things is forecast to be US$9.96 billion in 2014 and will continue to grow at a CAGR (compound annual growth rate) of 34.1% to reach US$57.96 billion by 2020.
Countries that have adopted Internet of Things technologies early include Japan, Singapore, China, Australia and South Korea.
However other countries in like India, Malaysia, Thailand and Indonesia are expected to be some of the fastest growing Internet of Things markets in Asia Pacific between 2014 and 2017, the market and research firm said in a statement.
Andrew Milroy, vice president of the Asia Pacific ICT Practice at Frost & Sullivan, said that there are several factors driving the adoption of IoT in the region, such as regional government efforts to improve competitiveness in their economies and city planners’ efforts to address social demographic challenges in their cities.
“From a technology perspective, the continued efforts to miniaturise and reduce the cost of sensors mean that sensors are expected to be integrated at the chip level and will be found in almost every device and home appliance.
“Furthermore the improved communication infrastructure in the region, coupled with the ready availability of cost-effective compute and storage (cloud computing) will help drive development and adoption of Internet of Things.
“The Asia Pacific region is characterised by a large presence of manufacturing economies and has one of the largest production networks in the world. This is expected to drive spending on IoT applications in telematics and supply chain visibility.
“IoT spending in the manufacturing industry is expected to be one of the fastest growing markets in Asia Pacific, growing at a rapid CAGR of 52.7% between 2014 and 2020,” he added.
Milroy also said that whilst IoT spending in logistics and transportation currently contributes to the bulk of IoT spending (and is expected to remain the largest IoT segment in Asia Pacific for the foreseeable future), IoT spending in the consumer technology segment is expected to experience phenomenal growth between 2014 and 2017.
The IoT market is however not without its challenges, as there are several factors that could prevent it from achieving rapid adoption, Frost & Sullivan said.
Security and information privacy are some of the largest hurdles to the adoption of IoT. With smart and connected devices embedded in business processes and tied to critical functions, the ability to negatively affect enterprises and individuals is increased significantly.
The lack of standardisation and data sharing frameworks will also inhibit IoT adoption, as this results in fragmented and closed IoT ecosystems, reducing the justification and benefits of investing in IoT solutions.
Lastly, the challenge of providing sustainable and cost effective power supply to millions (and in the future billions) of connected devices is likely to affect the feasibility of IoT implementations in specific industries.
Nonetheless, the market is expected to continue to grow strongly and develop on multiple fronts, as large industry specific enterprises continue to invest heavily in industrial IoT technologies in their respective industries, and nimble small enterprises leverage cloud and open source technology to develop innovative business solutions and services, Frost & Sullivan said.
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