Global IoT Market to surpass €1.5 trillion by 2028

The global Internet of Things (IoT) market shows every sign of maintaining its remarkable growth, projected to reach a staggering €1.53 trillion by 2028. This represents a very robust CAGR of 13.5% from recent valuations of just over €815 billion, fuelled by broadened adoption and integration of 5G and AI technologies.

Enterprise IoT solutions are forefront of this expansion, with forecasts indicating they will account for 72% of the market revenue by 2028, up from 70% in 2023.

This trend highlights a clear shift towards business-driven IoT adoption across diverse markets, with the Asian-Pacific manufacturing sector being the most vigorous, holding the largest market share at 25% in 2023.

This dominance is attributed to the region's rapid economic expansion, aging workforce, and increasing use of mobile devices in the workplace. It’s not a surprise to most market-watchers that China continues to be the region's fastest-growing manufacturer and is projected to have the greatest CAGR.

However, the regional industry faces challenges in standardizing IoT protocols, which can hinder seamless communication and interoperability between devices from different manufacturers. This also holds true for the global market, but with the Chinese market’s heavy regulation of technologies like eSIM, the issues are expected to become more pronounced.

5G's role in IoT market expansion

5G networks offer significant advantages over previous generations of wireless technology, including: 

• High bandwidth: Data speeds up to 100 times faster than 4G, enabling real-time data transmission and processing for IoT devices. 

• Low latency: Ultra-low latency, as low as 1 millisecond, enables near-instantaneous communication between devices, crucial for time-critical applications. 

• Parallel connectivity: 5G can support up to 1 million devices per square kilometre, enabling massive IoT deployments. 

• Network slicing: The creation of multiple virtual networks on a single physical infrastructure enables custom connectivity solutions for different IoT applications.

These capabilities make 5G a critical enabler of advanced IoT applications, supporting real-time data processing, massive device deployments, and enhanced connectivity. As 5G becomes more universally available, analysts have seen regional market IoT value increase in almost exact correlation to coverage. 

Emerging trends & future outlook

The IoT landscape is constantly evolving, with new trends and technologies emerging that will further shape its future.

Predictive maintenance 

Predictive maintenance, powered by AI for IoT (AIoT), is letting manufacturers anticipate equipment failures, minimizing downtime and maintenance costs through proactive scheduling. For example, General Motors uses AIoT to boost its Overall Equipment Effectiveness (OEE) by monitoring the health of assembly line robots, reducing their average maintenance costs by 19%. In a case study published by GM, their AI cameras were able to detect 72 separate component failures on an automated assembly line just by watching it work, demonstrating the tech’s effectiveness in identifying and preventing defects.  

Data Centers

The rising number of data centers is playing a crucial role in supporting this current surge of growth of IoT in manufacturing. Data centers that can handle the huge volumes of unstructured data generated by smart devices, enabling efficient collection, collation, analysis, and storage. However, the lingering effects of the 2020 – 2023 semiconductor shortage crisis is still being felt in the IoT device market, impacting production and supply chains.

Edge computing

Edge computing is a network architecture technique where data is processed close to its source, rather than by geographically distant hubs, thus reducing latency and improving real-time decision-making in IoT applications. This is particularly beneficial for applications that require immediate response, such as autonomous vehicles and industrial automation. By bringing computation closer to the edge devices, edge computing minimizes the need to transmit large amounts of data to the cloud, reducing latency and improving real-time performance.

Blockchain

Blockchain technology, familiar to most people as the tech that underpins cryptocurrency, can also be used to enhance security and transparency in IoT ecosystems by creating secure and tamper-proof data sharing mechanisms. This is particularly relevant for applications that require secure data exchange, such as supply chain management and healthcare. By providing a decentralized and immutable ledger, blockchain can ensure the integrity and authenticity of data shared between IoT devices, enhancing trust and security. There is also tremendous potential in the development of IoT devices that can securely and independently execute financial transactions.

Civil operation

Enterprise business and manufacturing aren’t the only sectors driving the IoT market up towards the $2 trillion mark. There’s particularly rapid growth in civil infrastructure systems including smart cities, where IoT sensors and devices are being used to optimize traffic flow, manage energy consumption, and improve public safety in smart cities. Outside the cities, precision agriculture systems with edge computing architecture are using environmental sensors and drones to monitor crop health, optimize irrigation, and improve yields. 

The future

The future of the IoT market is bright, with continued growth expected across various industries. However, challenges such as security concerns, interoperability issues, and data privacy regulations need to be addressed to maintain adoption and prevent an imminent bottleneck.

However, security challenges remain a significant concern. The inherent vulnerabilities in IoT devices necessitate the implementation of robust security measures, such as strong authentication, encryption, regular security updates, and network segmentation. As fleets grow in scale and sophistication, so does the overall vulnerable surface.

Organizations should prioritize security best practices and proactively address vulnerabilities to mitigate risks and ensure the safe and reliable operation of their IoT ecosystems. This is why it’s essential to partner with the most trusted names in the IoT connectivity field, such as 1GLOBAL.

1GLOBAL provides cost-effective global eSIM & SIM connectivity for device fleets via the only worldwide IoT network with fully redundant failover reliability, agile provider switching, SGP.32 support and single-surface worldwide connectivity management.

The future of IoT remains promising, with emergent trends like edge computing and blockchain tech further shaping its evolution. Edge computing enables real-time data processing and decision-making at the edge, while blockchain enhances security and transparency in data sharing. These advancements will continue to unlock new possibilities and drive further growth in the IoT market.