The analyst company IDC has predicted that worldwide spending on the Internet of Things will pass $1 trillion in just three years. It has predicted that the spending will stand at $805.7 billion this year, 10.6% above 2022. Between now and 2027, IDC expects to see a compound annual growth rate of 10.4%.
Commenting on the prediction, Carlos Gonzalez, a research manager of IoT at IDC, said:
“The last few years have shown that connecting with a digital infrastructure is no longer a luxury, but a necessity. For organizations to excel in data-driven operations, investing in IoT projects is essential. Connecting devices to data networks to gather insight, expand operations, and increase performance are the hallmarks of executing an IoT ecosystem.”
While the home uses of IoT technology may spring to mind for many readers, a lot of the spending will come from the business markets. Discrete and Process Manufacturing are the industries that will invest the most in IoT solutions through 2027, making up a third of all the spending.
Professional Services, Utilities, and Retail are the next biggest group making up 25% of the worldwide total. The sectors with the fastest spending growth over the coming years will be state and local governments and Telecommunications. By investing in IoT, organizations can solve business goals, make cost savings, and improve supply chain efficiency.
Broken down, IoT services will account for most IoT spending throughout the period while hardware spending will come in second. Software spending will be the fastest-growing category. In terms of geography, Western Europe, the US, and China will account for more than half of all IoT spending.
With interest rates rising in the developed world and some businesses at risk, it’ll be interesting to see how this prediction holds up. Analysts like IDC are known to revise estimates periodically as situations change.