Italy of Things: Smart home projects propelling €1.55bn Italian IoT market

Italy's Internet of Things market is set to reach €1.55bn this year, with smart home products driving it forward.
Written by Federico Guerrini, Contributor

The Internet of Things sector market may be worth trillions of dollars, and Italy's no slouch when it comes to spending on connected objects.

According to recent research from the Polytechnic of Milan, the IoT market in the country was worth €1.55bn last year.

"We estimate that in 2014 there were more than eight million 'smart objects' connected to mobile networks in Italy, which is an increase of 33 percent increase over the previous year, accounting for €1.15bn of market value," head of research at the Polytechnic of Milan's Internet of Things Observatory Giovanni Miragliotta told ZDNet. "To this, we added another €400m coming from machines that use other protocols to connect: like Wireless M-Bus, Bluetooth Low Energy, or wi-fi."

The University built a model to evaluate the economic impact of IoT in Italy based on data from several sources: surveys of the main companies operating in the field such as software firms, system integrators, and installers; interviews; case studies; and sending out questionnaires on specific subjects like smart homes and smart cities to consumers, local government organisations, and other stakeholders.

It's also worth mentioning that the researchers' term "market value" refers to the revenue generated by projects started in 2014, by those that started before but were carried out during the year, and to earnings from maintenance work on existing projects.

IoT's growth areas

"There are basically three fields which we see growing exponentially," Miragliotta said. "First of all, smart car applications: the GPS and GPRS boxes used by insurance companies to locate and keep track of vehicles' usage. There are currently almost 4.5 million connected cars on the road, or 12 percent of all cars out there."

Another sector with lots of potential, albeit one which currently represents only a small fraction of Internet of Things applications, is 'smart homes'. A survey of 1,000 homeowners found that 46 percent of respondents are willing to buy 'intelligent' products or services for their home in the near future.

"One in four respondents already has an 'intelligent' object in their home, the most valued applications being those related to monitoring and security and to managing heating and lighting consumption," the Observatory says.

According to the researchers, the 'smart home' will become the main interface for connecting individuals to industrial IoT applications. Smart metering, above all, will allow the measurement of energy consumption, cutting costs and encouraging sustainability..

Italy has been pioneering the use of smart electricity meters since 2001 (first country in the world).

Soon, smart metering is likely to be extended to water and gas monitoring. An early trial, promoted by the Italian Energy Authority, is currently taking place in nine cities - Turin, Reggio Emilia, Parma, Modena, Genoa, Verona, Bari, Salerno and Catania.

Last, but not least, many cities have launched projects to connect and remotely manage parts of the public infrastructure, using sensors to collect data on citizens' behaviour and make more effective use of taxpayers' resources.

"Out of the 200 municipalities that we have analysed, around half of them have implemented some kind of pilot in the last three years, and 75 percent of them say they are going to start at least one trial in 2015," Miragliotta says.

However, smart city applications are still the subject of a lot of hype. As far as Italy is concerned, smart cities products still represent a very small part of the whole IoT ecosystem (around four percent of the market) and there are huge differences from town to town.

"Generally speaking, in small [population] centers, the focus is restricted to making existing services more efficient, while larger cities are taking a more holistic approach," Miragliottasays. Having little or no public funding is the main obstacle discouraging a more widespread adoption of Internet of Thing in Italian cities, followed by the lack of adequate skills inside government agencies.

There are, however, some interesting case studies. Trento, in the north east, for instance, has gained international recognition for its efforts in using telehealth (monitoring patients' conditions remotely and reducing therefore the time spent in hospitals) and sustainable mobility, ending up being included - as the only European member - in the Institute of Electrical and Electronic Engineers' Smart Cities Initiative.

On a smaller scale, another interesting example is that of Grottamare, a small municipality in the Marche region, which has installed sensors on the lampposts along the beaches, as well as in the town. Initially, they will be used to monitor the noise level in the more touristy areas while later on other functionality, such as traffic monitoring and improving accessibility for residents, will be added.

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