Third-Party IoT Platforms a Key Driver in Global Markets for IoT Platforms, Reports BCC Research
WELLESLEY, Massachusetts, July 7, 2016 /PRNewswire/ --
Although IoT (Internet of Things) is a nascent market, it shows great promise as a game changer in the connected Internet world. BCC Research reveals in its new report that businesses exploring the IoT ecosystem should understand the market for third-party IoT platforms and the different technology trends shaping future platforms.
The IoT defines a network of interconnected things and devices which are embedded with or connected through sensors, software, network connectivity and the necessary electronics that enable them to collect and exchange data over the Internet, making them remotely accessible and automated.
The global market for IoT platforms should grow from $629 million in 2016 to over $2.3 billion by 2021, reflecting a five-year compound annual growth rate (CAGR) of 30%. As a segment, the cloud (Software as a Service [SaaS]/Platform as a Service [PaaS]) market should reach $2.1 billion in 2021, up from $528.4 million in 2016 on a projected five-year CAGR of 31.5%. The On-premise market as a segment is expected to reach $100.6 million and $256.7 million in 2016 and 2021, respectively, on a five-year CAGR of 20.6%.
The global IoT platform market is expected to see a widr adoption of pure cloud-based SaaS and PaaS solutions, barring industries where on-premise or private network-based deployments are necessary and preferred over cloud-based solutions. This trend will also benefit the revenue structure of these vendors with a higher long-term return compared to a one-time sale provided by the license-based revenue model.
An interesting trend shaping this segment is the growing interest of many of the larger IT solutions/service providers who view IoT platforms as high margin solutions that will generate a steady revenue stream through cloud-based, subscription revenue models. This has spurred a number of high value acquisitions in the past three years, and the recent Cisco-Jasper acquisition is expected to be a game changer for the IoT platforms market in 2017 and beyond.
Also, this segment of the IoT industry is seeing increased activity from many global mobile network operators for connectivity management platforms, as well as IT solution developers for application enablement platforms. The market has benefitted from the combined effects of a strong lineup of new IoT platforms, a marketing push to educate IT decision makers on the scope of their platforms and a sustained demand for platforms in the enterprise and consumer applications segment. The growth potential, however, is highest for industrial IoT applications and platforms.
"In the past two years, the third-party IoT software platforms market has seen a strong thrust and wider adoption," says BCC Research analyst Nandita Bhotika. "Vendors agree that the market for wireless IoT solutions has strong long-term growth prospects. They anticipate significant growth in the number and type of devices being wirelessly connected, driven by a number of enablers, such as lower wireless connectivity costs, faster wireless connection speeds, new devices and tools to simplify the development of IoT applications as well as increased focus and investment by large co-system players."
Technology Platforms for the Internet of Things (IoT) (IFT129A) analyzes technologies and applications in an array of IT products and services in five major global regions. Analyses of market drivers and trends, with data from 2014, 2015, and projections of CAGRs through 2020 also are provided.
Editors and reporters who wish to speak with the analyst should contact Steven Cumming at [email protected].
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