Asia Pacific's spending on internet of things (IoT) increased by almost 10 per cent in 2021, reaching US$437 billion by 2025 at its current growth rate.
Marking a rise of 8 per cent between 2020's growth rate and that of 2021, analyst firm IDC claimed the APAC region's IoT spending should maintain a compound annual growth rate of 12.1 per cent between 2020 and 2025.
Last year, spending hit around US$270 billion after growing by 9.6 per cent between 2020 and 2021. This in itself marked a stark increase from its 2019-2020 growth rate of 1.5 per cent.
According to the firm's Worldwide Semiannual Internet of Things Spending Guide, this growth is driven by increased adoption of location tracking, facial recognition, remote working, cold chain logistics and tracking of vaccines, video-centric application and deployment of 5G in the region.
"IoT in the Asia Pacific excluding Japan (APEJ) markets continues to grow steadily across multiple industries including transportation, retail, manufacturing, resources and utilities driven by the increased capacity and reliability of fibre and cellular network infrastructure," said Bill Rojas, adjunct research Director at IDC Asia/Pacific.
"In many Phase I projects, enterprises focused on a single use case and on acquiring the data streams from single sources but as the organisations gain a deeper data-driven understanding of their operations, they can start to use other data sources (such as geolocation, machine maintenance data, weather, transactions activity, vehicular telemetric traffic data and so on) to improve their analytics and expand beyond the original use case," he added.
For the channel, service providers can expect to clean up in the IoT space, according to IDC, as services became the largest technology group in 2021 and is set to keep this trend through to the end of 2025.
Australia was the fourth biggest spender in the market within the APAC region, trailing China, South Korea and India, and was followed by Indonesia.
Meanwhile, countries that will see the fastest IoT spending over the period are Hong Kong, Singapore and Malaysia.
Driving national IoT adoption are initiatives like building smart infrastructures, such as wider connectivity coverage, 5G deployment, public wi-fi zones, smart grid, smart cities and special economic zones.
According to IDC, discrete and process manufacturing will be the largest source of IoT spending in APAC, with one-third of the shares in 2021, followed by consumer and government, respectively.
Accelerating technology investments, especially in manufacturing, retail, transportation, construction and consumer sectors will be a focus, IDC added.
The firm claimed industries that experienced the fastest growth in 2021 were predicted to be construction and retail, with rises of 13.1 per cent and 13 per cent, respectively.
IDC's forecast is more optimistic than that of fellow analyst Frost & Sullivan, released last April, which claimed APAC would reach the US$436.8 billion figure by 2026.
The firm claimed the IoT market is rapidly being transformed by mega trends, including the integration of edge-computing networks into IoT systems and new narrow-band (NB) IoT deployments.