IoT investments in APAC are expected to reach $435 billion in 2027
Internet of Things (IoT) spending in the Asia Pacific (APAC) region is forecasted to reach $277.5 billion in 2023, an increase of 11% compared to the previous year, according to IDC’s latest Worldwide Semiannual Internet of Things Spending Guide.
The study revealed that the growing adoption of IoT in the region is chiefly due to a rising demand for remote operations, supply chain efficiency, deployment of commercial 5G and increasing digital footprint. IoT investments in APAC are expected to reach $435 billion in 2027, growing at a compound annual growth rate (CAGR) of 11.7% between 2023 and 2027, according to the study.
“IoT connectivity technology both fixed and wireless continues to improve and play an increasingly important role in IoT adoption. Power-saving IoT devices built with 5G enhanced Machine Type Communications technologies such as 5G Reduced Capacity (RedCap) will start to be introduced into the market to gradually replace LTE Cat 3/4 devices. The result will be more video-enabled endpoints and advanced analytics. 5G Non-Terrestrial Network satellite connectivity is expected to be introduced to the market during the forecast period further extending the reach of IoT to remote areas”, said Bill Rojas, adjunct research director for IDC Asia/Pacific.
Rojas highlighted that some of the main use cases for IoT in the APAC region include disaster recovery and response, oil and gas as well as mining and resources monitoring. “5G-enabled mobile private networks in manufacturing, transportation and utilities will take advantage of mid-band and mmWave IoT device connectivity enabling 4K video cameras and ultra-low latency for automated mobile robots. Fiber connected smart sensors for many applications including monitoring of bridges and highways, and control of smart elevators, traffic lights, and street lights are starting to gain traction and be combined with wireless technologies to provide robust scalable solutions,” he added.
The IDC study also stated that discrete and process manufacturing will see the largest investment in IoT solutions this year and throughout the forecast period, accounting for more than one-third of all IoT spending in the APAC region. State and local Government and Telecommunications will deliver the fastest spending growth over the five-year forecast with CAGRs of 15.1% and 14% respectively, IDC said.
Meanwhile, the IoT use cases with the higher level of spending this year are manufacturing operations, production asset management, supply chain resilience, inventory intelligence and public safety and emergency response. Together these use cases will make more than one-third of the overall IoT spending in APAC.
“Organizations are more focused on data-driven operations to address specific business goals and customer challenges, and investing in the IoT ecosystem is crucial. The majority of the enterprises indicated in an IDC survey that they are collecting or plan to collect biometric, video, and transactional data to achieve the above goals,” said Sharad Kotagi, market analyst of the Customer Insights and Analysis Group of IDC.
China continues to hold the largest share in terms of IoT spending in the region, with more than 60% in 2023, followed by South Korea and India. Countries with the fastest IoT spending in 2023 are China, Singapore and Hong Kong.
