iot investment analysis: 2017 - compass intelligence · 2019-03-17 · driven market intelligence...

IoT Investment Analysis: 2017:A Bird’s Eye View in Key IoT Investment Opportunities

COMPASS INTELLIGENCE, LLC | www.compassintelligence.com

2017

Date Created: March 2017Report Created by Compass Intelligence and CXOguide

©2017 Compass Intelligence and CXOguide Page 1

Table of Contents

About Compass Intelligence .........................................................................................................................9

Report Scope and Objective .......................................................................................................................10

Background .........................................................................................................................................10

Scope of the report .............................................................................................................................10

Market Introduction and Size .............................................................................................................12

Key Takeaways ....................................................................................................................................13

Executive Summary.....................................................................................................................................14

In 2017, investments in easy to measure and quick to assess applications will be high....................14

In 2017, Investments in IoT will be of agenda oriented than strategic ..............................................15

In 2017, customers with long-term vision will invest in pre-IoT infrastructure upgrades .................15

IoT investments are greatly dependent on user demographics, industry dynamics, and technologyliteracy.................................................................................................................................................16

Industries such as retail, cargo and fleet management, automotive and manufacturing arepromising investment areas for 2017 .................................................................................................16

Global IoT Investments Overview ...............................................................................................................17

IoT Investment Overview....................................................................................................................17

Investment Breakout by IoT Applications 2017......................................................................................18

Automation will lead IoT investments in 2017 ...................................................................................20

IoT Investment Breakout by Industry Sectors 2017................................................................................23

Retail Industry will be the Biggest Investor for 2017..........................................................................25

IoT Investment Breakout by Regions 2017 .............................................................................................28

North America will be the highest investor in IoT Applications in 2017.............................................30


Looking Forward to 2018 ........................................................................................................................32

The Automotive Industry will be the big investment for future Research and development of IoTApplications.........................................................................................................................................32

2017 IoT Investments by Application..........................................................................................................33

IoT Investments in Automation by Regions and Industry sectors 2017 .............................................33

IoT Investments in Location Tracking by Regions and Industry sectors 2017 ....................................37

IoT Investments in Applications for Sending Alerts by Regions and Industry sectors 2017 ...............41

IoT Investments in Applications for Targeted Promotions by Regions and Industry sectors 2017 ....44

Investments in IoT Applications for Leveraging Customer Experience ..............................................47

IoT Investments by Industry 2017...............................................................................................................51

IoT Investments in Retail Industry by Regions and Applications 2017 ...............................................51

IoT Investments in Cargo and Fleet Management by Regions and Applications 2017.......................54

IoT Investments in Automotive Industry by Regions and Applications 2017 .....................................57

IoT Investments in Manufacturing Sector by Regions and Applications 2017 ...................................60

IoT Investments in Consumer Electronics Sector by Regions and Applications 2017 ........................63

IoT Investments in Healthcare by Regions and Applications 2017 .....................................................66

IoT Investments in Utilities by Regions and Applications 2017 ..........................................................69

IoT Investments in Homes by Regions and Applications 2017 ...........................................................72

IoT Investments in Hospitality by Regions and Applications 2017 .....................................................75

IoT Investments in Equipment Rental Industry by Regions and Applications 2017 ...........................77

IoT Investments in Digital Promotion Agency by Regions and Applications 2017 .............................80

IoT Investments in Commercial Buildings and Offices by Regions and Applications 2017.................83

IoT Investments in Oil & Gas Exploration / Mining by Regions and Applications 2017......................85


2017 IoT investments by Regions ...............................................................................................................88

IoT Investments in North America by Industry and Applications 2017 ..............................................88

IoT Investments in Europe by Industry and Applications 2017 ..........................................................91

IoT Investments in Asia-Pacific by Industry and Applications 2017....................................................94

IoT Investments in Rest of the World by Industry and Applications 2017 .........................................97

Conclusion.................................................................................................................................................100


List of Executive Summary Figures

ES Figure 1. Snapshot of Applications and IoT Areas of Investment ..........................................................10

ES Figure 2: US Business & Consumer IoT Revenues, 2014-2020...............................................................12

List of Figures

Figure 1: IoT Investment Breakout by Applications 2017...........................................................................19

Figure 2: IoT Investments Breakout by Industry Sector 2017.....................................................................24

Figure 3: IoT Investments Breakout by Regions 2017.................................................................................29

Figure 4: IoT Investments in Automation by Regions 2017 ........................................................................34

Figure 5: IoT Investments in Automation by Industry Sectors 2017...........................................................36

Figure 6: IoT Investments in Location Tracking by Regions 2017 ...............................................................38

Figure 7: IoT Investments in Location Tracking by Industry Sector 2017 ...................................................40

Figure 8: IoT Investments in Sending Alerts by Regions 2017 ....................................................................41

Figure 9: IoT Investments in Sending Alerts by Industry Sector 2017 ........................................................43

Figure 10: IoT Investments in Conducting Targeted Promotions by Regions 2017....................................44

Figure 11: IoT Investments in Conducting Targeted Promotions by Industry Sector 2017 .......................46

Figure 12: IoT Investments in Leveraging Customer Experience by Regions 2017 ....................................48

Figure 13: IoT Investments in Leveraging Customer Experience by Industry Sector 2017........................49

Figure 14: IoT Investments in Retail Sector by Region 2017 ......................................................................52

Figure 15: IoT Investments in Retail Sector by Applications 2017..............................................................53

Figure 16: IoT Investments in Cargo and Fleet Management Sector by Region 2017................................55

Figure 17: IoT Investments in Cargo and Fleet Management Sector by Applications 2017.......................56


Figure 18: IoT Investments in Automotive Sector by Region 2017.............................................................58

Figure 19: IoT Investments in Automotive Sector by Applications 2017....................................................59

Figure 20: IoT Investments in Manufacturing Sector by Region 2017........................................................61

Figure 21: IoT Investments in Manufacturing Sector by Applications 2017...............................................62

Figure 22: IoT Investments in Consumer Electronics Sector by Region 2017.............................................64

Figure 23: IoT Investments in Consumer Electronics Sector by Applications 2017 ....................................65

Figure 24: IoT Investments in Healthcare Sector by Region 2017 ..............................................................67

Figure 25: IoT Investments in Healthcare Sector by Applications 2017 ....................................................68

Figure 26: IoT Investments in Utility Sector by Region 2017 ......................................................................70

Figure 27: IoT Investments in Utility Sector by Applications 2017 .............................................................71

Figure 28: IoT Investments in Homes by Region 2017................................................................................73

Figure 29: IoT Investments in Homes Sector by Applications 2017............................................................74

Figure 30: IoT Investments in Hospitality Sector by Region 2017 .............................................................75

Figure 31: IoT Investments in Hospitality Sector by Applications 2017.....................................................76

Figure 32: IoT Investments in Equipment Rental Industry Sector by Region 2017 ....................................78

Figure 33: IoT Investments in Equipment Rental Industry Sector by Applications 2017............................79

Figure 34: IoT Investments in Digital Promotion Agency by Region 2017..................................................81

Figure 35: IoT Investments in Digital Promotion Agency by Applications 2017 .........................................82

Figure 36: IoT Investments in Commercial Buildings and Offices by Region 2017.....................................83

Figure 37: IoT Investments in Commercial Buildings and Offices Sector by Applications 2017.................84

Figure 38: IoT Investments in Oil & Gas Exploration / Mining Sector by Region 2017...............................86

Figure 39: IoT Investments in Oil & Gas Exploration / Mining Sector by Applications 2017 ......................87

Figure 40: IoT Investments in North America by Applications 2017 ..........................................................89


Figure 41: IoT Investments in North America by Industry Sector 2017......................................................90

Figure 42: IoT Investments in Europe by Applications 2017.......................................................................92

Figure 43: IoT Investments in Europe by Industry Sector 2017..................................................................93

Figure 44: IoT Investments in APAC by Applications 2017 .........................................................................95

Figure 45: IoT Investments in APAC by Industry Sector 2017.....................................................................96

Figure 46: IoT Investments in RoW by Applications 2017 ..........................................................................98

Figure 47: IoT Investments in RoW Industry Sector 2017 ..........................................................................99

List of Tables

Table 1: IoT Investments by Applications 2017 ..........................................................................................18

Table 2: IoT Investments by Industry Sector 2017......................................................................................23

Table 3: IoT Investments by Regions 2017 .................................................................................................28

Table 4: IoT Investments in Automation by Regions 2017 .........................................................................33

Table 5: IoT Investments in Automation by Industry Sectors 2017............................................................35

Table 6: IoT Investments in Location Tracking by Regions 2017 ................................................................37

Table 7: IoT Investments in Location Tracking by Industry Sector 2017 ....................................................39

Table 8: IoT Investments in Sending Alerts by Regions 2017 .....................................................................41

Table 9: IoT Investments in Sending Alerts by Industry Sector 2017.........................................................42

Table 10: IoT Investments in Conducting Targeted Promotions by Regions 2017 .....................................44

Table 11: IoT Investments in Conducting Targeted Promotions by Industry Sector 2017 .........................45

Table 12: IoT Investments in Leveraging Customer Experience by Regions 2017......................................47

Table 13: IoT Investments in Leveraging Customer Experience by Industry Sector 2017 ..........................49

Table 14: IoT Investments in Retail Sector by Region 2017........................................................................51


Table 15: IoT Investments in Retail Sector by Applications 2017 ...............................................................53

Table 16: IoT Investments in Cargo and Fleet Management Sector by Region 2017 ................................55

Table 17: IoT Investments in Cargo and Fleet Management Sector by Applications 2017 ........................56

Table 18: IoT Investments in Automotive Sector by Region 2017..............................................................58

Table 19: IoT Investments in Automotive Sector by Applications 2017 ....................................................59

Table 20: IoT Investments in Manufacturing Sector by Region 2017 .........................................................61

Table 21: IoT Investments in Manufacturing Sector by Applications 2017 ................................................62

Table 22: IoT Investments in Consumer Electronics Sector by Region 2017 ..............................................64

Table 23: IoT Investments in Consumer Electronics Sector by Applications 2017 .....................................65

Table 24: IoT Investments in Healthcare Sector by Region 2017 ...............................................................66

Table 25: IoT Investments in Healthcare Sector by Applications 2017.......................................................67

Table 26: IoT Investments in Utility Sector by Region 2017 .......................................................................69

Table 27: IoT Investments in Utility Sector by Applications 2017 ..............................................................71

Table 28: IoT Investments in Homes by Region 2017.................................................................................72

Table 29: IoT Investments in Homes Sector by Applications 2017.............................................................73

Table 30: IoT Investments in Hospitality Sector by Region 2017................................................................75

Table 31: IoT Investments in Hospitality Sector by Applications 2017.......................................................76

Table 32: IoT Investments in Equipment Rental Industry Sector by Region 2017.....................................77

Table 33: IoT Investments in Equipment Rental Industry Sector by Applications 2017 .............................78

Table 34: IoT Investments in Digital Promotion Agency by Region 2017 ...................................................80

Table 35: IoT Investments in Digital Promotion Agency by Applications 2017 ..........................................81

Table 36: IoT Investments in Commercial Buildings and Offices by Region 2017 ......................................83

Table 37: IoT Investments in Commercial Buildings and Offices Sector by Applications 2017 ..................84


Table 38: IoT Investments in Oil & Gas Exploration / Mining Sector by Region 2017 ................................86

Table 39: IoT Investments in Oil & Gas Exploration / Mining Sector by Applications 2017 .......................87

Table 40: IoT Investments in North America by Applications 2017............................................................88

Table 41: IoT Investments in North America by Industry Sector 2017 ......................................................90

Table 42: IoT Investments in Europe by Applications 2017........................................................................91

Table 43: IoT Investments in Europe by Industry Sector 2017 ...................................................................93

Table 44: IoT Investments in APAC by Applications 2017...........................................................................94

Table 45: IoT Investments in APAC by Industry Sector 2017 ......................................................................96

Table 46: IoT Investments in RoW by Applications 2017...........................................................................97

Table 47: IoT Investments in RoW Industry Sector 2017...........................................................................98


About Compass Intelligence

© 2017 by Compass Intelligence, LLC. All rights reserved. No part of this publication may be reproducedor transmitted in any form or by any means, electronic or mechanical, including photocopy, recording,or any information storage or retrieval system, without permission in writing from the publisher.

This report was prepared by Compass Intelligence, LLC and CXOguide.

About Compass IntelligenceCompass Intelligence is one of the leading market analytics and consulting firms specializing in metrics-driven market intelligence and consulting focused on the entire mobile ecosystem, device recommerceand recycling, IoT, and emerging technology markets. Compass Intelligence provides a number of keyservices including strategic advisory, market sizing/modeling, competitive benchmarking, executive-levelconsulting, and turn-key survey services. Providing quality services over 11 years, many of the toptechnology vendors rely on Compass Intelligence’s expertise and insights to make better and moreinformed planning, strategy, and development decisions. Visit us athttp://www.compassintelligence.com to learn more.

About CXOguideCXOguide is an up and coming information resource producing high-quality information and strategicinsight reports. CXOguide provides the latest information on driving trends, technology disruptions,competitive dynamics, markets forecasts and industry estimates, opinions of key industry leaders andtechnology updates for ‘C’ level executives to help make ‘Informed Decisions’.

DisclaimerThis publication provides informative material of a professional nature. It does not constitutemanagerial, legal or accounting advice, nor should it serve as a corporate policy guide, laboratorymanual or an endorsement of any product. This information is intended to be as accurate as possible atthe time of publication, and Compass Intelligence and CXOguide assumes no responsibility for any lossesor damages that might result because of reliance on this material.

Reproduction of any material in this report is strictly forbidden without express permission of thePublisher.


Report Scope and Objective

Background

Internet of Things (IoT) is a buzzword today and one of the most focused areas of technologydevelopment worldwide. The industry involves various small and large stakeholders across the globewho supply hardware, software and such services for IoT applications, platforms, connectivity, andenablement. The industry is evolving from its infancy stage into a burgeoning complex market ofmarkets, and this a crucial time for both vendors as well as the customers to gauge where the industrywill go and how will it be beneficial.

There are ongoing, daily speculations regarding the benefits of IoT for government, businesses andconsumers, and the number of things that are and will be connected to the Internet by 2020. Previousprojections were inflated, and have been pulled back by some of the larger vendors in the market. It hasbecome vital for all the stakeholders in the industry to really get to the basics and bring out where themarkets for IoT ever stand.

You can observe that big players in strategic consulting are getting their numbers down, the high-valueforecasts of trillions of dollars are fallen to billions and in some cases to millions. Now the question isdoes anyone have real numbers. The frank answer is no one…

You have to understand the fact that the IoT industry is facing various challenges including no standarddefinition (which makes any technology or application or product that connects to the Internet claim forIoT), no standardization (leading to monopolistic approach or vendor lock-in) and too many players ofsmall to large capacity, providing for a diverse and complex market ecosystem.

ES Figure 1. Snapshot of Applications and IoT Areas of Investment

Source: CXOguide and Compass Intelligence 2017


Scope of the report

Compass Intelligence and CXOguide in their latest report on IoT investments in the year 2017 – 2018provides ‘Bird’s Eye view’ of how the market will be in the year 2017. We have designed our research ina way that it will bring out a frank and clear view on investments in IoT during 2017. The report willprovide practical viewpoints based on past investment portfolios of IoT in various industry sectors,regions and applications.

While estimating the investment projections we have developed a model as close to realistic activity(past and expected) and estimate projections in a unique and validated manner. Our model continues tobe improved, benchmarked, and validated on an ongoing basis to further refine and provide value to ourclientele.


Market Introduction and Size

According to Compass Intelligence, the U.S. market alone will reach $924M in IoT revenues in 2017, andgrow to reach $2.3B by 2020. Revenues includes all monies received by both businesses and consumersfor technology applications, connectivity, hardware, software, and services related to IoT. IoT includesthe full solution of connecting machines, things/objects, equipment, devices, wearables, and othergoods for business, government, and consumer use. Annual growth will remain in the double-digits overthe next 5 years, with larger opportunities residing in IoT investments by business and governmententities.

ES Figure 2: US Business & Consumer IoT Revenues, 2014-2020

Source: CXOguide and Compass Intelligence 2017


Key Takeaways

Investments by Industries: Understand which industries are investing and how much during2017

Investments by IoT-enabled Applications: Which IoT-enabled applications will be bought, bywhich industries in 2017and why will they buy these applications

Investments by Regions: Regional Breakout of investments by industries and IoT-enabledapplications through 2017

Along with this core information, we are adding investments by products and services as well ascorrelating tables between various investments. Overall, this report is going to be very informative…

We are also placing qualitative analysis with trend analysis and need-gap analysis that will help tofurther understand the investment scenarios and the reason for the investments in various applicationsand products.

How customers measure RoI in IoT investments. Focus on this area is also included in the report that willhelp understand the math behind investments in IoT.

What we are not including is descriptions about IoT and its enabling technologies, company profiles, andcompetitive analysis. The report will not have information regarding the evolution of the IoT industryand a future course in terms of technology development.

This report by Compass Intelligence and CXOguide focuses on investment in IoT and its related keymetrics.


Executive Summary

In 2017, investments in easy to measure and quick to assess applications will be high

IoT is still a new and evolving concept for many from supply-side and purchasing areas of the enterprise.And, therefore understanding the concept for both types of stakeholder is more or less on similargrounds. And it will take the time to gauge the full potential of IoT applications.

This is why; we will see more of experiments, trials, tests, and smaller implementations rather than full-scale implementations. The industry is in a growth phase with newer companies of small to large scalefrom various sectors worldwide planning and executing pilots or restricted IoT projects during 2017.

The second half of 2017 will be more promising for IoT vendors where there are possibilities of scaling-up of earlier projects to larger capacities where results are good for the pilot implementations.However, to make this happen consistently and on a larger scale, IoT vendors will need to clear all typesof doubts from the customer’s mind before scaling-up, especially projects that are B2B2C meaning theyare developed to be client facing or to make business money but the interface is consumers.

Therefore, in 2017 most of the investments will be based at the application level rather than going forall-inclusive deployments or full operations. For example, automation will become a key application areafor many industrial sectors whether they are small scale or have multi-national operations. Automationfor many is a known area and therefore both IoT vendors and purchasers are able to visualize thebroader picture of the outcomes and benefits of IoT-enabled automation quite clearly. Industrialautomation is actually in a mature phase, yet IoT technology is taking many aspects of the operations toan even-more automated level than every performed before.

In 2017, investments in easy to measure and quick to assess applications will be quite high. These willinclude Automation (including industrial, building, operational automation), Leveraging CustomerExperience, Location Tracking, Targeted Promotions, Alerts and such other applications.


In 2017, Investments in IoT will be more agenda oriented than strategic

Increasing customer satisfaction levels, reduction in costs of operations, optimization of availableresources and building long-term business engagements are some of the quick expectations of IoTapplication customers.

IoT investments are incremental and highly dependent on the results of earlier deployments and the‘Returns on Investments’ (RoI) on investments made will gain new orders of deployments.Demonstrating RoI varies due to numerous factors such as the size of the company, applicationsinstalled, current complexities in company infrastructure, operations and technologies used, budgetsand government compliances and compliance with the industry standards. Therefore, there will not bethe holistic realization of RoI but rather it will be a systematic process and will be a natural progressionaccording to the nature of the company, its management and industry category.

In 2017, customers with long-term vision will invest in pre-IoT infrastructure upgrades

This year, these pre-IoT infrastructure investments to upgrade and prepare the network andconnectivity include the following key activities:

Integrating operational technology with information technology Digitization of processes and applications Centralizing data from various functions and developing data segregation processes Identification of roadblocks such as present implementations of multi-vendor, multi-standard

devices and applications such as ERP, CRM, MES built as per the need of each function,department or location

Streamlining these processes and applications to bring all under synchronized and with seamlessintegration and in a centrally operated manner

Breaking down the silos and making company navigation seamless Taking care of data privacy policies, access controls and security policies

In 2017, most of the IoT investments will be in building basic infrastructures such as adding smartsensors to the system, adding big data analytic tools and platforms, edge computing, etc. Investments inIoT implementations that require mere modifications in existing infrastructure will be higher during2017. For example in cargo and fleet management adding IoT-enabled implants to RFID tags andtrackers and adding real-time data analytics to the process is easy up-gradation of existing infrastructureor adding IoT-enabled beacons and Wi-Fi hub-spots in a store with the addition of real-time analyticsplatforms for the retail industry are just the beginning. These IoT investments will be major drivers for2017 investment spending.


IoT investments are greatly dependent on user demographics, industry dynamics, andtechnology literacy

Investments in IoT during 2017 will be highly dynamic and diversified in terms of demographics,industries, and applications. Other than physical deployments of IoT, investments will flow in mappingIoT needs, consultation and training for IoT.

The investments in IoT are greatly dependent on the culture of a location, user demographics,technology awareness, technology penetration and technology literacy.

IoT investments are highly dependent on management characteristics, dynamics of the location such asindustry zone, tourism zone or agricultural zone, connectivity options and availability of bandwidth, datarequirements, and availability of IoT expertise on board or through third party consultants and advisors.

Industries such as retail, cargo and fleet management, automotive and manufacturing arepromising investment areas for 2017

Industries such as retail, cargo and fleet management, automotive and manufacturing are promisinginvestment areas for IoT in 2017. Healthcare, utility, consumer electronics, and home automation willfollow and be in the middle range of investment levels. The slower adopters and lowest investmentareas will lie in hospitality, equipment rental service providers, digital promotion agencies, commercialbuildings and offices, and oil & gas exploration and mining industries.

iot investment analysis: 2017 - compass intelligence · 2019-03-17 · driven market intelligence...

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