FRAMINGHAM, MA – Worldwide spending on the Internet of Things will grow at a 17% CAGR from 2015 to 2019, IDC said.

The research firm expects sales to rise from $698.6 billion in 2015 to nearly $1.3 trillion in 2019.

On a geographic basis, Asia/Pacific is the clear leader when it comes to IoT spending, with more than 40% of the worldwide total coming from this region in 2015, the firm says. North America and Western Europe are the second and third largest regions, respectively, with combined spending of more than $250 billion this year. The regions that will experience the fastest growth in IoT spending over the five-year forecast period are Latin America (26.5% CAGR), followed by Western Europe and Central and Eastern Europe.

"The Asia/Pacific region’s robust IoT spending outlook builds on three dynamics,” said Marcus Torchia, research manager, Internet of Things. “Developing countries’ technology investment needs are not fully met with traditional IT, which is allowing IoT investments to accelerate; government investments in infrastructure development and local business modernization, in China, India and the Philippines for example, are incorporating more and more IoT elements; and a burgeoning new consumer class is accelerating expenditures in goods and services, including those with IoT components."

From a vertical industry perspective, manufacturing and transportation led the way in worldwide IoT spending, with 2015 totals of $165.6 billion and $78.7 billion, respectively. Over the next five years, the industries expected to have the fastest IoT spending growth will be insurance (31.8% CAGR), healthcare, and consumer. The fast expanding consumer IoT market will be the third largest IoT spending category by the end of the forecast period, says the IDC.

"Manufacturing and transportation are both a good fit for IoT deployments," said Vernon Turner, senior vice president and IoT research fellow. "Both industries have been connecting their supply chains, products, customers, and even workers for some time now and really embrace the value of business outcomes."

In Central and Eastern Europe (CEE) and the Middle East and Africa (MEA), the fastest growing IoT category is smart buildings, where IoT technology that utilizes advanced automation and integration is being used to measure, monitor, control, and optimize building operations and maintenance.

In Latin America, the fastest growing IoT category is maintenance and field service, where service data are automatically measured, recorded, and transferred remotely from the field for monitoring and use by technicians.

In Asia/Pacific, insurance telematics is being used to monitor driver behavior through a vehicle-mounted device, and the data are being employed as a means of determining insurance policies and rates.

In North America, in-store contextual marketing is growing, as retailers seek to capture continuous, real-time streams of data from mobile devices, online customer activity, in-store Wi-Fi routers/beacons, and video cameras to gain insight into customer behavior and desires.

In addition to the IoT use cases identified above, connected vehicles was among the fastest growing use cases across five of the six geographic regions.

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