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Manufacturing driving IoT spending in Asia Pacific
China is the biggest spender in IoT across the region.
As the adoption of Internet of Things (IoT) gathers steam in Asia Pacific, a recent study projected more than half of the investments this year will be poured into discrete and process manufacturing.
Research firm IDC forecasted IoT spending in the region will reach $435b by 2027 from an estimated $277.5b this year, rising at a compound annual growth rate of 11.7% within five years.
Of which, manufacturing will see the largest investment with 38.2% or about $106b of the estimated investments in 2023 likely to be deployed in discrete manufacturing –which creates distinct products involving parts and systems.
Process manufacturing, where products are produced in bulk using formulas, is also expected to make up for 13.7% of all the investments this year. Together, the two types of manufacturing are projected to account for about 52% of the entire IoT spending in the region this year alone, or around one-third of all expenditures between 2023 and 2027.
Following closely behind is utilities which will eat up less than a quarter of all investments this year, while expenditures by governments and firms’ budget for professional services are expected to make up 9.3% and 8.5% of total spending, respectively.
IoT is a network of connected devices and the technology that facilitates communication between the devices, such as home security systems, fitness trackers and smart gadgets.
Organisations are pouring in more resources in the sector to improve quality, efficacy, and customer experience of their products and services, according to IDC.
“Organizations are more focused on data-driven operations to address specific business goals and customer challenges, and investing in the IoT ecosystem is crucial,” said Sharad Kotagi, a market analyst at the research outfit.
Across the region, mainland China remained the biggest IoT spender accounting for over 60% of total spending in 2023, followed by South Korea and India. Countries with the fastest IoT spending this year were China, Singapore and Hong Kong.
The emergence of smart factories and Industry 4.0, together with government-backed IoT programs, were the major drivers of IoT adoption in Asia Pacific according to the study.
