IDC is forecasting the number of things connected to the Internet in Asia Pacific excluding Japan will increase from 3.1 billion to 8.6 billion by 2020 and that the value of the market will increase from $US250 billion to $US583 billion. However it has not indicated exactly which components of this market of ‘things’ are covered by these figures.
Charles Reed Anderson, associated VP, head of mobility and Internet of Things at IDC Asia/Pacific, said: “The Internet of Things industry has matured considerably over the past year, with a number of large government initiatives across APeJ, and China in particular, driving demand. This increase in market demand has led to an increased focus on IoT from leading ICT vendors, as well as start-ups – with each keen to grab their share of the growing IoT market.”
He added: “While high level IoT market forecast information by region or country can be useful to certain audiences, it adds little value to those functional areas with more specific requirements. Sales and marketing, for instance, require IoT forecasts aligned to industry verticals so they can effectively set targets and tailor their go-to-market messaging; while product management requires IoT forecasts aligned to use cases (eg digital signage) so they can understand the addressable market for their solution portfolio across multiple industries.”
IDC says China will continue to dominate the Asia/Pacific region, accounting for 59 percent of the APeJ market opportunity by 2020, but will also be one of the leading markets globally with nearly one out of every five units connected by 2020 being in China.
Market magnitude v market maturity
However, according to Anderson, market size should not be confused with market maturity. “To assess the maturity of a market, we compare the total number of things connected to the overall population to get a connections per capita figure. Based on this calculation, we discovered the top three most mature markets were South Korea, Australia and New Zealand, with China coming in sixth out of the 13 APeJ Countries.”
IDC has also compared industry uptake of IoT. “Not surprisingly, the Government industry leads the way, as national, regional and city governments aggressively try to leverage IoT solutions to drive new revenue streams, reduce costs and enhance citizen services as part of their smart government initiatives,” it says. “Other leading industries include utilities, discrete manufacturing, healthcare and retail.
Anderson adds: “For the vendors looking at IoT, it is vital they understand which industries are driving the markets they are targeting as each country has its own unique drivers. Singapore’s leading industries, for instance, are telecoms, consumer and transport, none of which are ranked in the APeJ top five industries for market opportunity. Having this level of market knowledge will allow the vendor community to tailor their go-to-market messaging for each market and increase their chances of success.”
IDC APeJ market forecast webinar
IDC will conduct an IoT Market Forecast l webinar on 28 April 11:00 – 12:00 Singapore time during which it promises to “further explain which countries, industries and use cases are driving the Asia/Pacific IoT market.” Details here, registration here.