The Asia Pacific, excluding Japan (APEJ), region IoT market is expected to grow to $381.8 billion by 2022, predicts IDC.
According to the latest IDC Worldwide Semiannual Internet of Things Spending Guide, the APEJ region will be the leader in worldwide IoT spending with the region accounting for 36.9% of the total worldwide IoT global expenditure in 2019, followed by US and Western Europe.
In 2018, China spent $159.1 billion, making it the top spender in the region. Following suit were South Korea and India, which spent $22.6 billion and $19.6 billion, respectively.
“The per capita IoT spending among the APEJ countries is quite varied, it is primarily related to the demographics, broadband penetration, coverage and capacity of the nation’s infrastructure, including telecommunications, modernity of commercial buildings, firm demographics, highways, and electricity/gas/water distribution,” says IDC senior research manager Ashutosh Bisht.
“The key drivers of IoT penetration will include the proliferation of cloud-based back-end services for data acquisition and analytics, and 5G fixed wireless deployments that are expected in Australia, New Zealand, and the Philippines before 2020.”
The year 2018 also saw IoT services as the largest technology category with $83.5 billion spent on traditional IT and installation services as well as non-traditional device and operational services.
Hardware spending was close behind at $78.4 billion, led by more than $65.7 billion in module/sensor purchases.
IoT software spending totaled $43.3 billion and will see the fastest growth over the five-year forecast period (2017-22) with a CAGR of 15.8%. Services spending will also grow faster than overall IoT spending with a CAGR of 13.3%, IDC said.
In 2018, discrete manufacturing ($43.9 billion), process manufacturing ($33.2 billion), and utilities ($20.1 billion) were the top three industries spending most on IoT solutions.
IoT spending among manufacturers will be largely focused on solutions that support manufacturing operations and production asset management.
In utilities, more than half of IoT spending will go toward smart grid(electricity), followed by smart grid(gas).
IDC predicts that telecommunications (16.6%), construction (15.9%), and healthcare (15.6%) industries will see the fastest compound annual growth rates (CAGR) over the five-year forecast period.
"IoT across Asia/Pacific (excluding Japan) continues to grow steadily as government, municipalities, and enterprises move from proof of concept and tests to live deployments as part of a strategy to enhance productivity and efficiency, build smart city infrastructures, capitalize on new technologies (e.g., software-defined networking, next-generation industrial automation, deep learning, mobile edge and 5G mobile and 5G fixed wireless access), and embrace digital transformation," said Hugh Ujhazy, associate vice president for IoT and telecommunications at IDC Asia/Pacific.