The Internet of Things (IoT), which excludes PCs, tablets and smartphones, will grow to 26 billion units installed in 2020 from 0.9 billion in 2009, representing an almost 30x increase, according to IT research and analysis firm Gartner Inc.
IoT is the network of physical objects that contain embedded technology to sense, communicate or interact with their internal states or the external environment. It encompasses hardware, embedded software, communications services and information services associated with the things.
According to Gartner, the IoT product and service suppliers (companies that provide the hardware, software and services) will generate incremental revenue exceeding $300 billion (mostly in services) in 2020. This will result in $1.9 trillion in global economic value-add through sales into diverse end markets.
"The growth in IoT will far exceed that of other connected devices. By 2020, the number of smartphones, tablets and PCs in use will reach about 7.3 billion units," said Peter Middleton, research director at Gartner. "In contrast, IoT will have expanded at a much faster rate, resulting in a population of about 26 billion units at that time."
In addition, enterprises will make extensive use of IoT technology, and there will be a wide range of products sold into various markets, such as advanced medical devices; factory automation sensors and applications in industrial robotics; sensor motes for increased agricultural yield; and automotive sensors and infrastructure integrity monitoring systems for diverse areas, such as road and railway transportation, water distribution and electrical transmission.
"By 2020, component costs will have come down to the point that connectivity will become a standard feature, even for processors costing less than $1. This opens up the possibility of connecting just about anything, from the very simple to the very complex, to offer remote control, monitoring and sensing," said Middleton.
According to the research firm, emerging areas will witness rapid growth of connected things, which will lead to improved safety, security and loss prevention in the insurance industry. IoT will also facilitate new business models, such as usage-based insurance- calculated based on real-time driving data. The banking and securities industry will continue to innovate around mobile and micropayment technology using convenient point-of-sale (POS) terminals and will invest in improved physical security systems.
IoT will also support a large range of health and fitness devices and services, combined with medical advances, leading to significant benefit to the healthcare sector. Emerging connected sensor technology will lead to value creation in utilities, transportation and agriculture. Most industries will also benefit from the generic technologies, since their facilities will operate more efficiently through the use of smart building technology.
(Edited by Joby Puthuparampil Johnson)