Global IoT Market to Reach $318 Billion by 2023: GlobalData

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The major verticals to dominate IoT market are government, manufacturing and utilities, with an overall 58 per cent of the opportunity in 2018

The global Internet of Things (IoT) technology market is likely to reach US$ 318 billion by 2023 and would grow at a compound annual growth rate (CAGR) of 20 per cent, according to a leading data and analytics company – GlobalData.

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The global market for IoT technology, which comprises software, devices, connectivity and services, reached US$ 130 billion in 2018, said the analytics company.

According to forecast by GlobalData, the major verticals to dominate IoT market are government, manufacturing and utilities, with an overall 58 per cent of the opportunity in 2018. The share would be little smaller in 2023 with 55 per cent of the market.

Transportation and energy are other key verticals, with a total 15% of the market in 2018 as well as 2023, it stated.

While IoT connectivity and devices get a lot of exposure from operators and vendors, services and software clearly consist of the largest opportunity. The vertical includes engineering, maintenance, installation and project management. In addition, the category includes IoT platforms, application development software and services.

Devices and connectivity to lead in growth

While services and software still leading in revenue by the end of the period, the rate of growth from 2018 to 2023 is little higher for devices and connectivity, as the new 5G services and LPWAN and growth of edge computing, will drive higher growth in revenues, said GlobalData.

Commenting on the findings, Kathryn Weldon, Technology Analyst at GlobalData, said, “The diverse ecosystem of providers offering software and services makes this segment especially competitive. Operators are vying to offer value-added services beyond connectivity, while network and infrastructure vendors are branching out into IoT platforms and applications.”

Weldon further said, “IT service providers, systems integrators and consultants are providing a wealth of consulting and integration services, while business software vendors and vertical VARs and specialists are providing IoT application development and ‘pre-shrunk’ applications. It is too soon to say whether there is room for all of the different vendors chasing many of the same verticals, with, in many cases, overlapping capabilities.”

“What is clear is that IoT remains a highly strategic growth market in the eyes of all of these vendors; in spite of the fact that some form of IoT has been around for over twenty years, the real high growth cycle for this market is just beginning,” she added.

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