The Strategist

Bain & Company: IoT market will double in the next three years

08/09/2018 - 05:44

Bain & Company expects that by 2021 the world IoT (Internet of Things) market will double the current volume and reach $ 520 billion. According to experts, the Internet of things will be most in demand in the industrial and corporate segments.

ITU Pictures via flickr
ITU Pictures via flickr
Bain & Company’s report " Unlocking Opportunities in the Internet of Things", presented yesterday, is based on a survey of more than 600 executives of companies from different sectors of the market. The majority of the respondents believe that corporate clients are most enthusiastic about the immediate prospects of the Internet of Things. Back in 2016, only about 40% of corporate clients planned to start using technologies related to the Internet of things. In 2018, 60% of them are already IoT users.

However, the respondents believe that their enthusiasm is not always supported by technology companies that are "insufficiently active in lowering the three most significant barriers to the development of the Internet of Things."

One of the main obstacles is considered to be concerns of customers regarding the security of data transmission and storage. 22% of corporate customers are ready to buy new Internet technologies of things, or pay more for development of existing ones if it helps to enhance security.

The second obstacle is potential complexity of integrating new solutions with existing technologies. Bain & Company experts note that not all IoT vendors have made the process of such integration easy for their customers, and they do not users’ concerns with this problem. If vendors invest more funds and resources in integrating their solutions into existing technologies, they will be able to offer more turn-key solutions. Another obstacle to a more active dissemination of IoT technologies are concerns about whether such innovations will pay back.

At the same time, the report notes that technology companies and their cloud services, like Amazon Web Services or Microsoft Azure, have leveraged penetration of IoT into the market. Cloud services providers actively support such innovations, help make them easier and faster using the already existing developments.

To sum it up, the next few years will be decisive in the development of the Internet of Things market as its leaders are extending their lead and expanding the range.

Those who cannot keep pace with the market’s development and satisfy the needs of customers, run the risk of falling behind competitors. So, for example, vendors of devices are at risk of falling behind software developers, who are more actively using the Internet of Things technologies. This may result in a decrease in profitability of products for manufacturers of devices. The report provides several examples of companies that show how to successfully and timely adapt the Internet of Things technology for the needs of customers and the market. For example, the IBM Watson project develops models to determine the degree of customer satisfaction with a specific product of a company. IBM Watson cooperates with Samsung and Kone industrial company, which produces elevators and escalators. In 2016, IBM Watson and Kone created a joint project, in which the cloud platform of the Internet of things can monitor operation of Kone systems, including creation of projects of smart houses with intelligent elevators, escalators, automatic doors, etc.