It’s going to be a robust year for the internet of things (IoT) with the interplay of fifth generation cellular communication (5G) and artificial intelligence (AI).
At a symposium in Barcelona, Spain in November 2018, research and advisory firm Gartner forecast 14.2 billion connected things to be in use in 2019, rising to 25 billion by 2021 and “producing immense volume of data.”
Nick Jones, research vice president at Gartner, said that with this growth and with continued innovation, IoT will deliver new opportunities for digital business innovation not just this year, but in the next decade.
“CIOs who master innovative IoT trends have the opportunity to lead digital innovation in their business,” he said.
CIOs were also advised to ensure they have the necessary skills and partners to support key emerging IoT trends as, by 2023, the “average CIO will be responsible for more than three times as many endpoints as this year.”
Attendant to the increased use of connected devices is the projected rise in global spending for IoT. Research firm IDC expects a double-digit annual growth rates through 2022, but for this year the projection is $745 billion, up 15.4 percent from the global spend of $646 billion in 2016.
US and China in the lead
IDC predicts the United States and China to be the global leaders for IoT spending in 2019 at $194 billion and $182 billion, respectively.
The ongoing trade spat between the two giants, notwithstanding, is making the world nervous. As talks between the two nations wrapped up this week with no clear way forward, Bloomberg reported that the US-China “speed dating” may not be enough to tame headwinds.
According to IDC, the US and China will be followed by these countries in IoT-led innovations and R&D spending — Japan ($65.4 billion), Germany ($35.5 billion), Korea ($25.7 billion), France ($25.6 billion), and the United Kingdom ($25.5 billion).
5G will make a difference
5G, which succeeds the 4G, 3G and 2G systems, is an expected boon for IoT.
With an estimated 20 Gbps download speed, according to an International Telecommunications Union (ITU) draft specification, 5G will be a big factor in realizing the potential of IoT.
Paolo Collela, former head of India Region at Ericsson, said in a corporate blog post that “5G is the foundation for realizing the full potential of IoT,” with an estimated 550 million 5G subscriptions in 2022, Asia-Pacific being the second-fastest growing region with 10 percent of all subscriptions.
5G, however, is much more than just fast downloads.
“5G will enable us to control more devices remotely in applications where real-time network performance is critical, such as remote control of heavy machinery in hazardous environments, thereby improving worker safety, and even remote surgery,” he said.
On the consumer side, Ericsson’s prediction is that around 20 percent of smartphone users will better connect to IoT devices such as household appliances and smart meters.
“We have already entered the age when humans and intelligent machines are interacting and working together. So far, we’ve only taken small steps into the future. Most of the zero-touch future is yet to be developed – and how we create that future is still in our hands,” said Dr. Pernilla Jonsson, Head of Consumer & IndustryLab. Data used by Ericsson is based primarily an online survey conducted during October 2018 of advanced internet users in 10 influential cities across the world.
ABI research believe that mobile service providers (MSPs) have a role to play in driving the growth of the consumer IoT market, which it said is a $6.6 billion opportunity.
Pablo Tomasi, senior analyst at ABI Research, said MSPs have all the technology and expertise needed at their disposal from NB-IoT and LTE-M to eSIM and should act quickly to shape the direction of the market.
“For instance, by launching consumer IoT products with flexible business models, possibly bundled with current smartphones and data plans, MSPs can help to generate customer demand, which in turn will attract more OEM to produce consumer IoT devices,” he added.
With the proliferation of these device, it is also expected that data growth will be immense.
“Data is the fuel that powers the IoT and the organization’s ability to derive meaning from it will define their long term success,” said Gartner’s Nick Jones.
Hence, he said “AI will be applied to a wide range of IoT information, including video, still images, speech, network traffic activity and sensor data.”
Gartner admits that the technology landscape for AI is complex and will remain so through 2023. However, it is also optimistic that “it will be possible to achieve good results with AI in a wide range of IoT situations.”
IoT for Industries
According to IDC’s prediction, manufacturing operations and production asset management will be the biggest spenders in IoT this year, with up to $100 billion and $41.7 billion in projected spending, respectively.
IoT use cases would spur the fastest spending growth in airport facility automation (transportation), electric vehicle charging (utilities), agriculture field monitoring (resource), bedside telemetry (healthcare), and in-store contextualized marketing (retail).
A separate report from Juniper Research reveals that the industry is expecting 775 million consumer vehicles to connected via telematics or by in-vehicle apps by 2023, posting average annual growth rate of of 18.7 percent over the next 5 years from 330 million vehicles in 2018.
This year, only over 1.1 million are equipped with vehicle-to-vehicle communications (V2V), but by 2023, there would be about 62 million vehicles with this kind of capability.
Meanwhile, IDC predicts that worldwide spending on robotics systems and drones will total $115.7 billion in 2019, an increase of 17.6% over 2018.
Robotics systems will be the larger of the two categories, with hardware purchases dominating spending, nearly two-thirds of which will be going toward spending on robotic systems, after-market robotics hardware, and system hardware.
“Purchases of industrial robots and service robots will deliver nearly 30% of the category total in 2019. Robotics-related software spending will largely go toward purchases of command and control applications and robotics-specific applications,” IDC said.
Investments in drones will total $12.3 billion in 2019, with hardware purchases and after-market drone software also dominating spending.