Australia's Internet of Things at home market grew 55 percent in 2017 to reach AU$583 million, according to Telsyte, driven by a rapid uptake of smart speakers and increasing internet connectivity for appliances such as air conditioners and security cameras.
The Telsyte Australian IoT@Home Market Study 2018 revealed that the average Australian household now has 17.1 connected devices in 2018, up from 13.7 in 2017. Telsyte said an "internet-connected device explosion" will drive this number to 37, or 381 million devices nationally, by 2022.
"Building connectivity into consumer products will allow manufacturers to develop new business models and provide intelligent services that not only change consumers' lifestyles, but disrupt a number of traditional industries," said Telsyte managing director Foad Fadaghi.
Growth is expected to be seen in the categories of smart energy, smart security, smart lifestyle, and smart hub devices. Smart speakers, which fall into the latter category, are particularly seeing a sales boom; half a million Australian households own a smart speaker, up from less than 10,000 in 2016, and the firm estimates this figure to hit 3 million by 2022.
Google Home and Google Home mini were the market leaders, Telsyte said, predicting Apple and Amazon's smart speaker offerings to catch up with Google's "as their products become more widely available" in 2018.
Telsyte also said it believes Apple's loyal user base presents opportunities for third-party manufacturers.
"Lock-in and ripple effects of Apple's ecosystem amongst Australian families are too big for IoT@Home manufacturers to ignore," Telsyte senior analyst Alvin Lee said.
Telsyte also predicts smart speaker adoption to "lay the foundation" for consumer demand for other smart home devices.
However, privacy and security concerns are impacting consumer decisions to purchase IoT devices. 41 percent of Australians are more concerned about cybersecurity than last year, Telsyte said, and 61 percent are concerned about their private information being exposed online.
The most important factor for consumers when purchasing an IoT device for the home, however, is ease of use, which includes being easy to set up and not requiring human monitoring.
Last year, Telsyte said that IoT adoption in the enterprise is gaining momentum in Australia, with nearly a quarter of Aussie organisations in the test, development, or production phase of IoT.
According to the Telsyte Australian Emerging Enterprise Technology Study 2017, 59 percent of early adopters claimed cost savings from using IoT, while 30 percent claimed increased customer satisfaction.
The firm previously predicted there will be 300 million connected devices in Australian homes by 2021.
Gartner had predicted that globally there would be 8.4 billion connected devices by the end of 2017, outnumbering the world's population.
Global IoT spending will reach nearly $1.4 trillion, according to IDC, led by enterprise investments IoT hardware, software, services, and connectivity.
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