The incredible inflating Internet of Things. Overview of current market research on IoT.

Ever wondered how big the Internet of Things? What will the market size of the Internet of Things be in 10 years? What research is worth reading? What research is worth paying for? The Internet of Things has got to a point now where more reports are being produced about the market size than there are companies being created. Panic not. This is normal in any emerging industry sector. Here are some of the most notable we have seen. Is paid research’ a la Garner, IDC etc the only source of useful information? Absolutely not, in fact, most of the really useful content is being produced and distributed online, for free. You could spend over $10,000 on this lot but you would probably be wasting money.

Here are some of the most notable efforts on the Internet of Things. A quick overview of some of the information out there with an arbitrary *-***** rating for usefulness and content. A wide range of useful and hopeless, paid and free. Any we missed? Any worth paying for?

* Business Insider. Here comes the IoT.

Register for ‘FREE’ Trial ($499), download report, cancel ‘FREE trial’. Read generic report derived from lots of other obvious sources of information cobbled together. Don’t waste your time unless you want a quick and generic overview and are happy to pay for it.

**** Economist Intelligence Unit and ARM.

Considers applications, attitudes of corporate players. Extensively researched (almost 800 interviews) and wisely avoids a ridiculous headline splashing, ‘the market will be worth X $Gazillion next year’. Hype.

**** Cisco. Embracing the Internet of Everything To Capture Your Share of $14.4 Trillion

Cisco reckon as much as “$14.4 Trillion of Economic Value is at stake”. While they insist on calling the Internet of Things, the Internet of Everything, presumably because they want to own the name. The Cisco report breaks this down into five areas:

“The five main factors that fuel IoE Value at Stake are: 1) asset utilization (reduced costs) of $2.5 trillion; 2) employee productivity (greater labor efficiencies) of $2.5 trillion; 3) supply chain and logistics (eliminating waste) of $2.7 trillion; 4) customer experience (addition of more customers) of $3.7 trillion; and 5) innovation (reducing time to market) of $3.0 trillion.”

Pretty good overview of strategic drivers behind IoT.

**** GE Industrial Internet. Pushing the boundaries of minds and machines.

Global IoT opportunity is approximately $32 Trillion (Global GDP is approximately $70 trillion). Some good analysis of drivers, high level opportunities etc. Similar in feel to Cisco report though different charts. (also suggest IoT could add about $10 trillion of value to the world economy).

** Gartner. Paid reports though some public numbers.

“Gartner predicts that the total economic value add for the Internet of Things will be $1.9 trillion dollars in 2020, benefiting a wide range of industries, such as , healthcare, retail, and transportation.”

“Digital changes the IT market in a big way through the Internet of Things,” Mr. Sondergaard said. “In the technology and telecom sectors, revenue associated with the Internet of Things will exceed $309 billion per year by 2020.”

(Reasonably well researched though very high level). Scores low as very expensive reporting. Almost nothing available that isn’t out in public already.

** IDC. Internet of Things (IoT) 2013 to 2020 Market Analysis: Billions of Things, Trillions of Dollars

Another report from one of the big research houses. Typically generic and expensive. $4,500.

**** Big Data in M2M: Tipping Points and Subnets of Things

Noticeably less flashy than some of the big research house reports, Machina are the source of probably the best research on IoT issues out there. Very analytical but with a deep understanding of the space, they seem to understand what is driving the industry from the bottom up. Seem like they know what they are talking about and we wish they would produce an industry overview and distribute it for free…

The reason that the numbers keep going up in this type of research is usually very simple – research reports were historically produced by analysts – Gartner, Forrester etc – who make money by selling access to the research. Any emerging sector gets increasing amounts of ever more excited coverage from analyst firms pick on ever wider definitions of the subject to come up with a bigger number in their report that is supposed to be taken as market validation by potential investors etc. In the last Internet bubble, research coverage of B2B marketplaces went from a potential value of $1bn in 5 years to $60 trillion over a period of about 18 months. The research had long since become irrelevant or to broad to be of any value to anyone. I guess that while the primary producers of IoT research at the moment are corporates a similar dynamic exists as people go through the process of persuading their organisations to take the new thing seriously.

Regardless of the overall numbers, and they are likely to be big, the only meaningful analysis of the opportunity has to cover Total Addressable Market, not the overall market size.