Understanding IoT industry impact and use cases

The top industries respondents see being most impacted by 5G and AI-enabled IoT solutions by 2025 are led by automotive and transport, energy and utilities, and manufacturing.

Which industries will see the biggest impact from 5G and AI-enabled IoT?

Note: n=170. Chart shows % of respondent companies ranking the option in the top 5. Source: Omdia/IoT World Today.

The automotive and transport sector was by far the highest ranked in terms of expected impact, with nearly twice as many respondents choosing this vertical compared to telecoms and media, and healthcare and pharma. The promise of autonomous transport is clearly a part of what’s driving this expectation. Energy and utilities, and the manufacturing sector, are also expected to see very significant impact, with significant opportunities for 5G’s network slicing and edge capabilities as well as potential for AI to support significant automation and efficiency in areas like smart grid.

Respondents also highlighted these three verticals as being likely to deliver the most IoT revenues over the coming 5 years.

The top ranked IoT applications being deployed now, and expected to show the highest take-up over the coming 12-24 months, focus on monitoring and efficiency/productivity. Asset monitoring, tracking and management was by far the most popular IoT application group cited by both providers and enterprise end users, reflecting the high level of commercialization and the relatively quick RoI that can be achieved. Predictive maintenance also comes up high on the list, selected by 44% of respondents. End users and providers are attracted by the promise of greater cost savings, higher efficiency and improved product quality and performance that predictive maintenance can deliver. There is a significant ‘long tail’ of other applications, indicating the diversity of IoT requirements.

Top 10 IoT Applications

Note: n=169. Multiple response question. Chart shows % of respondent companies identifying the application as one of those most widely-adopted by the market, or which they themselves have deployed or are planning for the coming 24 months. Source: Omdia/IoT World Today.

Security is a key priority – and a key concern – for IoT providers and enterprise end users

IoT security continues to be a significant concern for enterprises deploying IoT, and it’s also high on the agenda for IoT solutions providers. In total, over half of enterprises surveyed identify IoT security as one of their top barriers to successful IoT deployments, and 42% of IoT providers agreed.

Biggest challenge for enterprises in deploying or scaling IoT projects - % of respondents selecting 'Security concerns'

Note: n=29 enterprises and 141 IoT providers. Chart shows % of respondent companies selecting the ranking shown for ‘security concerns’, when asked to identify top IoT challenges. Source: Omdia/IoT World Today.

Reflecting this concern, incorporating end-to-end security in their IoT solutions roadmap or adoption plans is a high short-term strategic priority for respondents. 64% of technology providers we surveyed identify this as their main short-term priority, while 45% of enterprises say it is a short-term priority for adoption (or already underway). IoT security has become an increasingly important area of focus and discussion for the past years, and providers are clearly starting to fully appreciate the critical nature of security for their enterprise and consumer customers. Enterprises are already using a number of different strategies enterprises to ensure IoT security, and IoT providers are offering multiple security approaches as part of their IoT solutions. End users report using 3 to 4 different IoT security methods on average, underlining the complexity they face in protecting their IoT deployments and data as well as their existing communications networks. As shown below, end-to-end data encryption, regular firmware and software update policies, and checking on physical security of devices are the main methods being offered by providers and employed by enterprise end users.

How are you currently building security into your/your clients' IoT plan? (% of companies using each option)

Note: n=170. Chart shows % of respondent companies stating they are using or offering the option shown. Source: Omdia/IoT World Today

Sustainability is emerging as an important IoT driver

Sustainability is increasingly coming up on the radar as an IoT benefit for many companies. When asked about future IoT evolutions, two-thirds of respondents (66%) agree that sustainability will be a top-3 driver for IoT innovation over the coming five years.

Note: n=170. Chart shows % of respondent companies in each category: green indicates highest percentage while red indicates lowest percentage. Source: Omdia/IoT World Today.

As discussed above, 5G and AI also came up as significant technologies having future impact on IoT. Respondents were more on-the-fence about prospects for blockchain in IoT, with more than half saying they weren’t sure or disagreed that it would be a key technology for IoT solutions.

At the same time, 85% agree that security concerns will be a major barrier to IoT adoption, echoing the results discussed in the previous section.