Internet of Things component market set for rapid growth

According to Gartner, the Internet of Things (IoT) market is set to grow rapidly -- especially within the processor, sensor and communications segments.

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Credit: Tesla

Gartner says the Internet of Things (IoT) processor, sensor and communications markets are set to grow by 36.2 percent next year.

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The research firm said Monday the processing, sensing and communications semiconductor device arenas are set to grow at a rapid pace over the coming years, growing 36.2 percent in 2015, compared with overall semiconductor market growth of 5.7 percent. Processing will be the largest revenue contributor, at $7.58 billion in 2015, while sensors will see the strongest growth, with 47.5 percent growth in 2015.

It is expected that the automotive and household consumer markets will drive this growth, as companies continue to research and develop Internet of Things-based products — including smart lighting and vehicle infotainment systems — as well as create ever-more sophisticated mobile devices that take advantage of sensors and perform power-heavy tasks.

Gartner says demand for new semiconductors in the automotive industry is based around modern safety regulations and convenience — such as autonomous driving — and sensors can be used for "predictive maintenance," in which a car alerts the driver to necessary fixes. LED lighting is a cheap way to enable sensors, and consumers are likely to add to IoT device demand thanks to wearable technology, such as smart glasses, watches and fitness bands.

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Dean Freeman, research vice president at Gartner commented:

Gartner forecasts almost 30 percent growth through 2020 for IoT semiconductor revenue. This revenue spans every conceivable industry and is driven by the immense scale of low-cost devices. Some in the industry believe this growth will transform the semiconductor industry. However, further investigation shows that the majority of IoT devices are commodity offerings. The truth is that inexpensive devices are one of the biggest enablers of IoT.

Read on: In the world of innovation

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