Middle East, Africa IoT investments to top $6.6bn in 2016; IDC
IDC reveals manufacturing, freight monitoring and smart grid applications are the three IoT verticals driving MEA organisations
International Data Corporation (IDC) forecasts that organisations in the Middle East and Africa (MEA) will invest more than $6.6bn in Internet of Things (IoT) hardware, software, services, and connectivity in 2016.
Manufacturing and transportation are the vertical industries leading the way in terms of IoT investment in MEA, with both expected to spend an estimated $1.1bn each in 2016 and the next largest industry is utilities, which is expected to see IoT investments of almost $800m this year.
Across the MEA region, manufacturing operations, which supports digitally executed manufacturing, or how manufacturers use intelligent and interconnected tools, such as sensors, to enable different components in the industry to autonomously exchange information, trigger actions, and control each other independently.
Another vertical, is freight monitoring, which uses RFID, GPS and GIS technologies to create an intelligent, Internet-connected transportation system. This system carries out the intelligent recognition, location, tracking, and monitoring of freight and cargo by exchanging information and real-time communications via wireless, satellite, or other channels.
Lastly, the smart grid industry is growing in the region. Non-smart field devices owned by the electric utility are used to control and optimise power flow to ensure efficient, safe, and reliable service.
Wale Babalola, a research analyst for telecommunications, IoT, and digital media at IDC Middle East, Africa, and Turkey, said: "IoT solution deployments across MEA will continue to see increased adoption rates, both in the public and private sectors, as stakeholders begin to realise an immediate return on their investments. In addition, the growing development of purpose-built IoT platforms and the continuing proliferation of smart devices will serve as catalysts for IoT adoption across the region's industry spectrum."
While manufacturing and transportation will lead the way in terms of overall IoT investments in the MEA region, six industries will see IoT spending levels increase by more than 100% over the 2016-2020 forecast period - construction, consumer, insurance, manufacturing, retail, and telecommunications. Cross-industry investments, which represent use cases common to all industries, are also forecast to see revenues more than double during this period.
Marcus Torchia, research manager for IoT within IDC's Customer Insights and Analysis team, added: "A use case represents a detailed composition of a technology investment that is made to produce a set of end-user benefits. The long-term opportunity for IoT vendors is helping to identify and create immediate and residual benefits for end users through their technologies.
"We see strong opportunities across many industries. For example, in highly instrumented verticals like manufacturing and transportation, large data sets are used to optimise operational processes and extend the life of high-capital cost assets. In other sectors like healthcare and consumer, IoT technology is being used to produce benefits that improve quality of life."