Asia Pacific accounts for more than 40% of the global IoT spend of $698.6 billion in 2015, according to IDC.
The analyst firm says Asia Pacific was a clear leader in IoT spend for the year, well ahead of North America and Western Europe, which were second and third with a combined spend of $250 billion in 2015.
IDC says widespread initiatives and outlays across Asia Pacific boosted the spend this year.
IDC is predicting IoT spend to grow at 17.0% compound annual growth rate, reaching nearly $1.3 trillion in 2019. However, moving forward, Latin America, Western Europe and Central and Eastern Europe are expected to experience the fastest growth in IoT spend over the five-year forecast period.
Marcus Torchia, IDC Internet of things research manager, says Asia Pacific’s ‘robust’ IoT spending outlook builds on three dynamics.
“Developing countries’ technology investments needs are not fully met with traditional IT, which is allowing IoT investments to accelerate; government investments in infrastructure development and local business modernisation – in China, India and the Philippines for example – are incorporating more and more IoT elements; and a burgeoning new consumer class is accelerating expenditures in goods and services, including those with IoT components,” Torchia says.
Unsurprisingly, manufacturing and transportation have led the way in worldwide IoT spending, at $165.6 billion and $78.7 billion respectively.
Vernon Turner, IDC senior vice president and IoT research fellow, says manufacturing and transportation are both a good fit for IoT deployments and have been connecting their supply chains, products, customers, and even workers, for some time now.
IDC says over the next five years insurance (31.8% CAGR), healthcare and consumer are expected to have the fastest IoT spending growth. The company predicts the fast expanding consumer IoT market will be the third largest IoT spending category by 2019.
IDC says the fastest growing use cases for IoT vary from region to region.
In Asia Pacific, IDC cites the example of insurance telematics being used to monitor driver behaviour through a vehicle-mounted device with the data being rapidly employed as a means of determining insurance policies and rates.
In North America, in-store contextual marketing is growing rapidly as retailers seek to capture continuious real-time streams of data from mobile devices, online customer activity, in-store Wi-Fi routers/beacons and video cameras to gain insight into customer behaviour and desires.
Meanwhile, in Central and Eastern Europe and the Middle East and Africa, smart buildings are the fastest IoT category.
IDC says connected vehicles, which includes emergency, infotainment, security, vehicle-to-vehicle and vehicle-to-infrastructure applications – was among the fastest growing use cases across five of six geographic regions.