​IoT devices will outnumber the world's population this year for the first time

But analyst firm Gartner has slashed its 2020 forecast for Internet of Things devices by 20 percent, or five billion units.

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The 2020 total of IoT devices installed across the world will be more than twice this year's figure, says Gartner.

Image: Gartner

There will be 8.4 billion connected things in 2017, setting the stage for 20.4 billion Internet of Things (IoT) devices to be deployed by 2020, according to analyst firm Gartner.

The installed base of hard-to-secure smart things, such as TVs, fridges, and security cameras, is expected to grow 31 percent this year to reach 8.4 billion devices, or around a billion more than the world's total population. That figure compares with last year's total installed base of 6.38 billion devices.

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Gartner expects that spending on IoT devices and services will reach $2 trillion in 2017, with China, North America, and Western Europe accounting for 67 percent of all devices.

Consumer devices are the main driver today and will account for 5.2 billion units in 2017, or 63 percent of the total. Businesses meanwhile are set to use 3.1 billion connected devices this year.

For consumers, the main types of connected devices will be vehicles, smart TVs, and digital set-top boxes, according to Gartner, while business use will be dominated by smart electric meters and commercial security cameras.

Gartner is forecasting that the total number of connected devices will grow to 11.19 billion by 2018, at which point deployments will accelerate due to a rise in adoption of cross-industry devices, such as LED lighting, HVAC systems, and physical security systems. In 2017, this category of device will reach 1.5 billion units, rising to 4.38 billion units in three years' time.

The analyst still expects consumer IoT to dominate in 2020 with 12.86 billion units installed, while vertical-specific business devices will rise from 1.64 billion in 2017 to 3.17 billion in 2020. These include manufacturing field devices, process sensors for electrical generating plants, and real-time location devices for healthcare.

Although connected devices are increasing rapidly, today's growth is slower than Gartner expected in 2014, when it forecast 25 billion connected things by 2020. However, now its analysts think spending on IoT services will be nearly $3 trillion in 2020 rather than the $2 trillion predicted back then.

According to the analyst firm, consumers and business spent $1.4 trillion on devices and will spend $1.7 trillion in 2017, with business accounting for 57 percent of all spending this year. By 2020, spending will reach $2.9 trillion. Gartner says spending on IoT services in 2017, covering professional, consumer and connective services, will reach $273bn.

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IoT endpoint spending will reach almost $3 trillion by 2020, shown here by category in billions of dollars.

Image: Gartner

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