In the not so rosy Italian ICT landscape, there's a glimmer of hope coming from the Internet of Things (IoT) sector, which last year showed a double-digit growth, according to a newly-published report by the School of Management of the Politecnico of Milan.
While Italy's ICT market declined by 4.3 percent in 2013, the country's IoT sector grew 11 percent in value, with the number of mobile-connected objects reaching six million.
The market for objects that communicate through a cellular network, the study says, is now worth €900m compared to €810m in 2012, with a positive outlook for the near future thanks to the growing popularity of connected cars and smart home products.
The Italian IoT market could be set to grow larger still. The Politecnico's figures cover a single part (albeit the biggest one) of the whole local IoT market.
"We are focusing only on objects connected through cellular networks because that's the only part we are able to evaluate with a high degree of confidence," Giovanni Miragliotta, a researcher at Politecnico of Milan and coordinator of the report, told ZDNet.
What's left out, he said, are around 1 million more things that don't use SIM cards to communicate with the environment relying upon different technologies such as wi-fi.
The evolution of the car
The largest chunk of mobile-connected objects, the report states, is made of cars which account for 47 percent of the objects and 31 percent of the total market value. It's also the fastest-growing segment: more than 35 percent year-on-year.
Right now, according to the report, most of the applications for this market involve location-based services for private vehicles and the recording of driving metrics through in-car GPS or GPRS boxes for insurance purposes.
More sophisticated products, though, are slowly gaining ground along as the popularity of connected vehicles grows.
"Right now the market is being driven by consumers who are willing to let insurance companies collect data on their driving through a connected box in exchange for a discount on their insurance," Miragliotta said.
In the next few years, he said, manufacturers will bring IoT products so far only found on high-end vehicles to more affordable cars. The market will get a further fillip from the EUs eCall initiative, which mandates that, starting from October 2015, each new vehicle should be able to automatically place a call to the emergency services.
All these factors combined will make 'smart' cars more common: according to the Politecnico's research, they should grow from eight percent of all cars today to 20 percent in 2016, meaning more than 7.5 million 'intelligent' automobiles will be driving on Italy's roads.
Home sweet (smart) home
If cars, a traditional Italian passion, are driving the country's IoT's growth, good news come also from homes, which Italians own at levels not seen elsewhere on the continent.
The so called 'smart home and building' segment now accounts for 21 percent of the value of the mobile-based IoT market, and the Politecnico's report predicts more than three million connected objects will be found in Italian homes by 2016.
This surge is large part due (and conditional) to the spread Bluetooth Low Energy (BLE) technology, a standard that allows for less energy consumption now supported both by both iOS and Android.
BLE will be crucial, the report hints, to the spread of IoT applications since smartphones will be the "gateway of a big and varied set of smart objects, from wearable devices to proximity sensors and devices used for indoor location-based services and communication (such as [Apple's] iBeacon) for personal and business applications". In 2013, the study states, there were 8.3 million BLE-enabled smartphones in Italy.
Not so fast
Even though the Italian IoT market is alive and well, the road to maturity is still long, particularly on the consumer front, the report cautions.
While there's an increasing interest in sensors technology, smart gadgets and wearables, the adoption of new technologies by Italians have traditionally been slow.
"Smart homes is a segment to watch, but the speed at which it will develop is still uncertain: the whole ecosystem is just small compared to other countries," Miragliotta said. "If Nest Labs had been Italian I doubt that it would have reached a $3.2bn valuation."
In this scenario, it is no surprise that some promising Italian IoT startups have concentrated on B2B. Like W.I.N, a Tuscany based company that has already raised €800.000 in funding, which develops health monitoring devices for hospitals. Or Smart-I, based in Rome, which produces optical sensors that make street lighting more intelligent and efficient and was financed by Enel, Italy's largest power company.