The Internet of Things (IoT) market in the Middle East and Africa region is set to grow 15 percent year-on-year in 2018 to reach $6.99 billion, according to a recent report.
The International Data Corporation’s (IDC) Worldwide Semiannual Internet of Things Spending Guide latest study highlighted that MEA spending on IoT will expand further to reach $12.62 billion by 2021 as organisations ramp up their investments in the hardware, software, services, and connectivity that enable IoT solutions.
“IoT adoption in the MEA region is expected to accelerate over the coming year as organisations from both the public and private sectors increasingly digitalise their businesses in a bid to automate their operations and ramp up productivity,” said Wale Babalola, a research analyst for telecommunications and IoT at IDC MEA. “And as organisations increasingly realise the added value that is provided by IoT, we can expect to see further development of innovative industry-specific solutions.”
Totaling $2.48 billion, IoT services is forecast to be the market’s largest technology category in 2018, with the majority of this total going towards ongoing services, IT services, and installation services.
The study also noted that hardware will be the second-largest technology category, followed by software and then connectivity. The vast majority of hardware spend (85 percent) will go towards modules and sensors. Meanwhile, software will be market’s fastest growing category over the coming years, with spending in this area increasing at a compound annual growth rate (CAGR) of 21.3 percent over the 2016–2021 forecast period.
The industries that are expected to spend the most on IoT solutions in 2018 are manufacturing ($1.07 billion), transportation ($0.85 billion), cross industries ($0.76 billion), utilities ($0.75 billion), and consumer ($0.68 billion).
According to the report, manufacturers will direct most of their IoT spending over the coming 12 months towards solutions that support manufacturing operations and production asset management. Over in the transportation sector, fleet management and freight monitoring will account for up to 78 percent of IoT spending in 2018.
“The growing implementation of initiatives that leverage digital solutions will continue to fuel IoT adoption over the coming 12 months, particularly in Saudi Arabia and the UAE, ” said Babalola. “As such, these two countries combined are expected to contribute $1.57 billion of the MEA region’s total IoT spending of $6.99 billion in 2018.”
