The IoT market is growing at an unstoppable rate. People are getting drones, buying virtual reality headsets and converting their homes into smart homes. Not long ago, the greatest potential for the Internet of Things was seen especially in the industrial sector but the market has recently turned to focus on consumers. IoT is becoming mainstream and captures our hearts and minds: People want to connect everything in their lives.
The IoT market is not just growing; it is literally multiplying every year. While around 5 billion networked electronic devices are currently in use, Gartner says that this figure is expected to reach 14 billion by 2020. At the same time, analysts are coming up with new IoT forecasts every day – the rate of innovation is on the rise and in the end it could result in even more networked devices connecting every aspect of our daily lives.
Consumer IoT Market Surpasses Smartphone Market by More Than Double
You can get a feel for the enormous dimensions of the consumer IoT market by relating the figures to a type of device that is already well-known to us today, namely the smartphone. There should be around 6 billion of these worldwide by 2020. Yet, the IoT market surpasses the absolutely huge smartphone market by more than double. After many years of hype and mainly theoretical promises from the tech industry, IoT applications are emerging that offer consumers noticeable added value. Connected monitoring systems for the home and garden increase the feeling of security; virtual reality glasses offer an unprecedented entertainment experience; drones record the downhill ride in deep snow or a sailing trip around the Atlantic: IoT is finally bound for the mass market.
Former IoT Niche Products Turn into Applications for the Mass Market
The results of our new global study Smartphone and IoT Consumer Trends 2017 confirm that the purchase of IoT devices is growing in the triple-digit percentage range in some cases. The largest growth potential is recorded as up to 250 percent for virtual reality glasses and up to 500 percent for drones, followed by smart home automation with a growth potential of 330 percent and smart security systems with a potential of 275 percent. “People want to connect everything in their lives. They want to automate their home, experience virtual reality and use smart digital assistants. And it’s all happening now,” comments Prof. Dr. Thomas Hess, Director of the Institute for Information Systems and New Media at the Ludwig-Maximilian University of Munich that conducted the study in cooperation with B2X.
It may be surprising that rather specialized IoT device types such as drones are high on the consumer popularity scale. Until recently, drones were mainly used in the industrial field such as for professional safety applications or in scientific research. However, since China’s tech industry invested heavily in the consumerization of key features, brands like DJI, Yuneec and Zerotech remain no longer unknown to consumers. This trend can be applied to the entire IoT industry since services suitable for the masses are coming from former niche applications such as smart home and virtual reality, leading to an exploding demand for connected devices.
Smartphone as the Remote Control to People’s Personal IoT Networks
This is accompanied by the trend towards higher-quality smartphones. Linking to connected IoT devices and demanding applications require more computing power because the smartphone is being used increasingly as the remote control to people’s personal IoT networks. The assumption is that although cheap smartphone models may be suitable for calling, messaging and mobile Internet, they quickly reach their limits for more complex IoT solutions. So it is not surprising that nearly 10 percent of global consumers are already planning to spend more than $750 on their next smartphone. 26 percent plan to spend at least $500 while just 9 percent spent that much on their current device. People are prepared to invest more, worldwide and in a universally connected everyday life with a wide range of applications and with the smartphone as the heart and brain of their IoT network.
Summary: With 14 billion IoT devices and 6 billion smartphones, universal connectivity will eventually affect every moment of our everyday life. Many IoT applications, which until recently were niche, are bound for the mass market. You can read about the impact of this development on our daily lives in our current study Smartphone and IoT Consumer Trends 2017. All results, exciting video interviews with B2X CEO Rainer Koppitz, Prof. Dr. Anton Meyer and Prof. Dr. Thomas Hess from the Ludwig-Maximilian University of Munich, as well as comprehensive Infographics for free download can be found on our micro-page.
Kimberly Meyer is Head of Global Marketing & Communication at B2X.