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Industrial IoT Market Segmentation By Component (Solution, Services and Platform); By End User (Manufacturing, Healthcare, Energy & Power, Logistics & Transports, Oil & Gas and Others) – Industry Demand Analysis & Opportunity Outlook 2026

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Extensive insights into the Growth of Industrial Internet of Things Market amidst COVID-19

Before we witness the stabilization of economic growth in Europe and North America, Asia Pacific is estimated to bounce back progressively with countries such as China, India, South Korea and Japan witnessing more opportunities to recover from the losses sustained during COVID-19.

Being the biggest market in Eastern Europe, Russia is estimated to take the lowest hit, offering a sigh of relief to the businesses operating in the country. Whereas, GCC is estimated to observe low investments due to the sliding prices of crude oil.

We evaluate the strategies and commitment of the Giant Players in the market towards creating products and services that customers value and rely on.

In an attempt to control and eliminate the surge of coronavirus cases and meet the demand for required medical devices along with providing efficient medical services, there is a drastic shift of investments from authoritative bodies towards the healthcare sector. Where the aftermath of this pandemic may take years to be measured, Research Nester estimates notable expansion of e-health, gaming, and media and entertainment industries till the whole situation is contained and the plan of action for the recovery process is determined. There is an estimated probability of the growth in businesses going back a year if the condition is controlled in the next 2-3 months.                                                         Request Insights

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IN THE NEWS
  • In April 2019, ABB Ltd. announced that it had signed a Memorandum of Understanding (MoU) with Ericsson, a Swedish company, for the development of solutions that provide flexible production and wireless communication along with advanced automation.
  • April 2019: SAP SE (NYSE: SAP) announced a partnership with Uber Freight for the modernization of freight industry via intelligent process automation and better access to a network of connected and reliable drivers.
  • September 2018: NITI Aayog, the premier policy institute of the Government of India announced a collaboration with Oracle, Apollo Hospitals and Strides Pharma Sciences to steer a real drug supply chain using blockchain decentralized ledger and IoT software. The action taken is to fight against fake drug distribution.

Market Overview

According to statistics by the Organisation for Economic Co-operation and Development (OECD), labour productivity and utilization in the European Union decreased significantly from 3.06% in the year 2010 to 0.73% in the year 2018. Another statistics by the Federal Statistical Office of Germany stated that unit labour costs in Germany increased from (-)1.60% in the year 2014 to 2.40% in the year 2018

Labour Productivity and Utilisation GraphUnit Labour Costs GraphThe global industrial Internet of Things (IoT) market has been growing at a significantly high rate on account of growing concern for decreasing labour productivity and utilization along with increasing unit labour costs, which is raising the demand for automation of industrial processes. The increased applications of Internet of Things in the manufacturing and industrial sector are further anticipated to boost the market growth. The various advancements in technology, including artificial intelligence, robotics, cloud technologies and others can be attributed to the industrial IoT. This technology provides increased capabilities that allow the direct control of machines and devices used in industries and factories as well as the infrastructure which is responsible for creating a modern landscape. Industrial IoT is a key element of the Industry 4.0 revolution, which focuses on industrial automation by fusing cloud computing, AI and IoT with industrial applications and processes.

IOT Platform

The industrial IoT market is projected to observe a healthy CAGR of around 9% over the forecast period, i.e., 2019-2026. Moreover, the market held a market value of about USD 280 billion in 2018 which is anticipated to reach an estimated value of USD 525 billion by the end of 2026.CLICK TO DOWNLOAD SAMPLE REPORT

Growth Highlights based on Region during 2019-2026

The global industrial IoT (IIoT) market is segmented by region into North America, Latin America, Europe, Asia Pacific and Middle East and Africa. The market in North America is anticipated to hold the largest share during the forecast period. The region held the leading share of about 33% in 2018 in the global industrial IoT market. Further, the market in United States is predicted to account for the highest market revenue by 2026. The market in Asia Pacific is estimated to grow at the highest rate with an approximate CAGR of 10.1% over the forecast period. This can be attributed to the favourable initiatives introduced by the governments in this region for promoting the use of Internet of Things in various industries. 

Industrial IoT Market segmentation Graph

The study further incorporates Y-O-Y Growth, demand & supply and forecast future opportunity in North America (United States, Canada), Latin America (Brazil, Mexico, Argentina, Rest of LATAM), Europe (U.K., Germany, France, Italy, Spain, Hungary, BENELUX [Belgium, Netherlands, Luxembourg], NORDIC [Norway, Denmark, Sweden, Finland], Poland, Russia, Rest of Europe), Asia-Pacific (China, India, Japan, South Korea, Malaysia, Indonesia, Taiwan, Hong Kong, Australia, New Zealand, Rest of Asia-Pacific), Middle East and Africa (Israel, GCC [Saudi Arabia, UAE, Bahrain, Kuwait, Qatar, Oman], North Africa, South Africa, Rest of Middle East and Africa).

Market Segmentation Synopsis

By Component

On the basis of component, the industrial IoT market is segmented into solution, services and platform, out of which, the solution segment is anticipated to hold the leading share in the market. The IIoT solution providers have introduced various new information systems for a number of industries which is estimated to increase the market size of this segment in coming years. Further, the integration of systems and sensors, in order to enhance operational efficiency while improving the business models, is predicted to increase the use of industrial IoT solutions in the market. The segment for platform is projected to grow at the highest rate of about 9.5% during the forecast period.

Industrial IoT Market Share Graph

By End User

Based on end user, the market is segmented into manufacturing, healthcare, energy & power, logistics & transports, oil & gas and others. Out of these, the segment for manufacturing is anticipated to hold the leading share in the market on account of growing usage of IoT in the manufacturing industry. Growing application of IoT and cyber-physical systems for the operation of various processes at factories and to make data-centric automated decisions is a major growth driving factor for the manufacturing segment in the market. The manufacturing segmenet is anticipated to reach a market value of USD 150 billion by the end of 2026. Further, the manufacturing segment is projected to grow at the highest rate during the forecast period. In October 2019, Bosch announced to make an investment of USD 120 million in a project for developing smart factories for the production of automotive parts in Celaya, Mexico by implementing IoT technologies.

Market Drivers and Challenges

Growth Indicators

The main growth driving factor for industrial IoT market is the standardization of Internet Protocol version 6 (IPv6). The IPv6 is the latest Internet Protocol version which offers a location and identification system for computers on a network and directs traffic over the internet. Internet communication works by assigning every device that uses internet its own internet protocol address through which the device can then be identified. The rising demand for IPv6 technology in both private as well as government organizations is anticipated to result in the growth of industrial IoT market. Moreover, the increasing adoption of IPv6 in various sectors such as information technology, automotive, chemicals & electronics, production and manufacturing and others is estimated to be another growth driving factor. Various strategic initiatives taken by the governments of various nations, for instance, Plattform Industrie 4.0 (Germany), Made in China 2025 (China), Make in India (India), and others, coupled with the numerous consortia held by industry giants to address the growing need for industry collaboration and automation, for instance, Industrial Internet Consortium (IIC), AllSeen Alliance, Open Interconnect Consortium (OIC), IoT World Forum (hosted by Cisco) and others, are  actions that define the rising adoption of industrial internet.

Adoption

Additionally, the growing number of initiatives taken by governments across the world for increasing the adoption of Internet of Things by various industries is anticipated to further increase the market size.

Barriers

One of the major growth restricting barriers the industrial IoT market faces is lack of skilled workers in the industry. Currently, there is a shortage of labor with required skillset. The continuous development in the fields of artificial intelligence and robotics is raising the demand for employees having certain specific skills. The unavailability of skilled workers and increasing time and resources required to train them are factors estimated to hamper the market growth in the next few years. In addition to this, lack of security infrastructure for industrial IoT systems can create significant harm to the data privacy of the organization, which is estimated to become a restricting factor for the market growth as well.

Competitive Landscape

Some of the affluent industry leaders in the global industrial IoT market are General Electric Company, Intel Corporation, IBM Corporation, Siemens AG, Cisco, Rockwell Automation, ABB Ltd., Microsoft Corporation, Honeywell International Inc. and Huawei.


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