Global spending on the Internet of Things (IoT) is with the coronavirus pandemic expected to slow to 8.2 percent year-on-year in 2020 to USD 742 billion, according to the latest study from IDC. This compares to the earlier forecast of an 14.9 percent increase. Normal levels of growth should return, at double-digit rates, in 2021, with a compound annual growth rate (CAGR) of 11.3 percent over 2020-2024. 

China, the US, and Western Europe will account for three quarters of all IoT spend until end 2024. Although the three regions will have similar spending totals initially, China's spending will grow at a faster rate than the other two regions, with its CAGR at 13.4 percent, against 9 percnet for the US and 11.4 percent for Europe. The fastest IoT spending growth will be in the Middle East & Africa (19.0% CAGR), Central & Eastern Europe (17.6% CAGR), and Latin America (15.8% CAGR) regions. 

Declines at personal, consumer services, gains at healthcare, education

Personal and consumer services, including hotels, theme parks, casinos, and movie theaters, will be the only industry with a decline in IoT spending this year, down 0.1 percent from last year. The next three industries with the slowest growth this year will be discrete manufacturing (+4.3%), resource industries including oil and gas (+5.0%), and transportation (+5.7%). Healthcare, insurance, and education will deliver the strongest industry gains in IoT spending this year, with growth rates of 14.5 percent, 12.3 percent, and 11.9 percent respectively. Consumer spending on IoT services and systems will lift 13.9 percent. 

Smart home spending will be large use case

By use case, air traffic monitoring and connected oil field exploration will experience a decline in spending this year. Slow growth will be seen at manufacturing operations (5.6%), production automation (5.2%), and freight monitoring (4.7%). The use cases with the fastest spending growth will be electric vehicle charging, bedside telemetry, and remote health monitoring. 

Consumer driven smart home spending will be the second largest use case in terms of overall spend, up 14.4 percent. 

IoT services, composed of the IT and Installation Services and Ongoing Service or Content as a Service categories, will be the largest technology group this year and until the end of 2024. Together, these two categories will account for around one third of all IoT spending. Hardware spending, dominated by module/sensor purchases, will be nearly as large as IoT services. Software will be the fastest growing tech category with a five-year CAGR of 13.5 percent and a focus on application and analytics software purchases.