Global Internet of Things (IoT) Market in Manufacturing - Segmented by Software (Application Security Software, Data Management and Analytics Software, Monitoring Software, Network Management), Connectivity (Satellite Network, Cellular Network, RFID, NFC, Wi-Fi), Services (Professional Services, System Integration and Deployment Services, Managed Services), Application(Process Optimization, Predictive Maintenance, Asset Management) and Region - Growth, Trends and Forecasts (2018 - 2023)
The global Internet of Things (IoT) market in manufacturing was valued at USD 165.27 billion in 2017, and is expected to reach USD 350.51 by 2023, witnessing a CAGR of 13.15% during the forecast period of 2018-2023. The scope of the report includes the spending on IoT hardware, software, and services, by the manufacturing industry.
IoT device manufacturers are creating market opportunities, by creating proprietary ecosystem standards for IoT devices, which fall within their brand line, and then increasing switching costs, to eliminate threat from substitutes. The importance of global standards in the IoT environment is evident in the case of proprietary data formats. Data collection and analysis through IoT devices is a market worth billions of dollars by itself. The design of several IoT devices is such that, it is either incredibly hard to upgrade at a later stage, or the upgrade process is highly inconvenient to the users, leaving them perpetually vulnerable to cyber security threats. The lack of visibility into the internal workings of an IoT device, or the precise data streams they produce, create security vulnerability, where a user believes that a device is performing certain functions, when in reality, it might be performing unwanted functions or collecting more data than the user would prefer. Data-driven companies are already using IoT generated data, feeding them into their existing analytical pipeline and improving operational management and efficiencies, in addition to reducing costs. The major challenges involved in implementing a Big Data solution primarily dependent on IoT devices are - storing the colossal amounts of data being produced, running analytical queries among such huge amount of data stored using highly complex storage technologies, and performing advanced data analysis involving data mining and machine learning technologies to gain insights.
Improved Cost and Operational Efficiency Driving the Market
Advancements in IoT are leading to the continuous monitoring of almost every step in the value and supply chains of an enterprise. The primary value that IoT generates, is a result of the data captured from ‘Connected’ things, and the resulting insights that drive business and operational transformation. Data that is analyzed to trigger transactions and business administrative activities, come from Machine-to-Machine data, devices, and sensors. It helps companies understand and utilize IoT data available with them, and focus on improving business operations, thus reducing maintenance costs and avoiding equipment failures. IoT technology offers automated mechanisms for pulling machine data into data warehouses or Hadoop clusters and other big data platforms, for analysis. With the emergence of Big Data technologies, collecting, storing, and analyzing data from industrial sensors, network logs, and other machinery connected to IoT has become more feasible, thus increasing the rate at which these processes are being adopted.
Logistics and Supply Chain Management Application to Accelerate the Market Landscape
There has been a substantial change in the supply chain, with the adoption of mobile devices and sensors which include RFID and GPS, to track inventory and assets in warehouses. By 2018, it is expected that manufacturers will explore the importance of micro-logistics networks, in order to accelerate the delivery of selected products to customers. Improved inventory management due to the availability of real-time visibility of items and the ability to track and keep a count of inventory, is a very important outcome of the implementation of IoT in manufacturing industries. The collection of manufacturing information, expiry date, manufacturing date, after sales status, and warranty period, using tracking devices like RFID tags, will improve efficiency in supply chain monitoring in the manufacturing process. Access to real-time data analysis results is expected to help manufacturers deal with a problem before it occurs and will significantly help reduce the inventory costs.
North America to Dominate the Market
The market for IoT in manufacturing is mainly dominated by North America. This region has developed economies like the United States and Canada, which are heavily investing in the research and development (R&D) activities related to the market, thus contributing to the development of new technologies. With the early adoption of trending technologies, such as Mobility, Big Data, IoT, and DevOps, manufacturers are eager to integrate IoT technologies into their processes.
Connected devices and data flows already finding their applications in manufacturing. Therefore, it is now possible to expected accelerated deliveries, as the cost of infrastructure is reduced. To stay competitive, manufacturers are leveraging IoT and analytics, to run and improve businesses. In the United States, about 35% manufacturers collect and use data generated from smart sensors, to enhance manufacturing processes. According to a study, around 34% of the manufacturers believe it is extremely necessary that US manufacturers adopt IoT in operations. For manufacturers, IoT has become an ecosystem where software, cloud computing, and analytics tools are combined, to turn raw data from different sources into meaningful predictions and present them in easy-to-use interfaces. By 2025, the number of connected devices in the automation sector is expected to increase by a factor of 50.
Key Developments in the market
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