GSMA Intelligence

IoT: the next wave

of connectivity and
services
March 2018

© GSMA Intelligence gsmaintelligence.com • info@gsmaintelligence.com • @GSMAi


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 2 |  previous next
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This report was authored by
Sylwia Kechiche, Lead Analyst, IoT
 1 EXECUTIVE SUMMARY

2 IoT CONNECTIONS OVERVIEW

3 ASSUMPTIONS

4 APPENDIX: METHODOLOGY

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 Understanding the Internet of Things

• The Internet of Things (IoT) describes the coordination of

machines, devices and appliances connected to the internet
through multiple networks.

• These connected devices include everyday objects and

machines from across vertical industries. Consumer electronics
devices, wearables, vehicles, monitors and sensors are
equipped with machine-to-machine (M2M) technology that
allows them to send and receive data.

• In the industrial context, IoT enables new business models,

which create value by connecting existing and new things
together to establish new business processes, increase
business efficiency, enable greater innovation and drive
improved visibility across an organisation.

• For consumers, the connectivity provided by IoT can enhance

quality of life. Examples include energy efficiency and security
at home, and monitoring fitness and wellbeing.

 4 | Executive summary previous next

 Scaling IoT: 25 billion connections by 2025
GSMA Intelligence forecasts that
IoT connections will reach 25 billion
globally in 2025, up from 6.3 billion in
2016. The market will almost quadruple
in size over the forecast period. The
business case for IoT is shifting from
just connecting devices to addressing
specific problems or needs with
solutions, aided by the emergence
of horizontal platforms that collect,
process and integrate data from multiple
data sources, and then analyse the
data to provide actionable insights.
The decline in hardware cost (price
of IoT chipsets and sensors) and
emergence of energy-efficient IoT
connectivity are also growth drivers.
TOTAL
2025 25.2bn
 5 | Executive summary
Industrial IoT connections will overtake
consumer IoT connections in 2023,
and will increase more than five-fold
between 2016 and 2025, from 2.4 billion
to 13.8 billion. The industrial segment
will account for just over half of all IoT
connections in 2025 as IoT solutions
are deployed within enterprises (e.g.
smart buildings) and for vertical-specific
applications – for example, in utilities,
retail and manufacturing.
INDUSTRIAL
13.8bn
We expect consumer IoT connections
to almost triple in number between
2016 and 2025, to 11.4 billion. Devices
increasingly include connectivity
built-in, and there are signs of greater
interoperability within the ecosystem.
Smart homes will be the largest source
of growth within the consumer segment,
driven by home security, energy
monitoring and enabling infrastructure.
CONSUMER
11.4bn
previous next
 IoT connections by region in 2025

Commonwealth of
Independent States
Europe
0.7bn
4.9bn
North America

5.9bn Middle East

& North Africa Asia-Pacific

Latin America

1.3bn
1.1bn
Sub-Saharan Africa

0.3bn
11.0bn
Source: GSMA Intelligence

 6 | Executive summary previous next

 1 EXECUTIVE SUMMARY

2 IoT CONNECTIONS OVERVIEW

3 ASSUMPTIONS

4 APPENDIX: METHODOLOGY

 7 |  previous next
 IoT connections will reach 25 billion by 2025

GSMA Intelligence forecasts that the total number of IoT While IoT is rapidly becoming a mainstream technology in
connections (cellular and non-cellular) globally will reach 25.2 consumer markets such as consumer electronics and smart
billion in 2025, up from 6.3 billion in 2017. The size of the market home, the industrial IoT segment will be the largest source of
will almost quadruple over the forecast period. connections growth going forward.

Global IoT connections, 2010–2025

30,000
Million

25,000
25,191

20,000

4×

15,000

10,000

6,310
3×
5,000

1,989
0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Source: GSMA Intelligence

 8 | IoT connections overview previous next

 Industrial IoT overtakes consumer in 2023

Global IoT connections, consumer versus industrial, 2016–2025

15,000

Million
GSMA Intelligence estimates there were
3.9 billion consumer IoT connections in
2016, accounting for two-thirds of all IoT
connections. We expect consumer IoT
12,000
connections to almost triple between 2016
and 2025 to 11.4 billion. Smart home will
be the largest source of growth within
the consumer segment, driven by home
security, energy monitoring and home 9,000
infrastructure (routers).

Industrial IoT connections will increase

almost six-fold between 2016 and 2025,
6,000
from 2.4 billion to 13.8 billion, and will
account for just over half of all IoT
connections in 2025. This is due to the
growing adoption of IoT solutions within
enterprises in addition to growth in 3,000
specific vertical industries – for example,
utilities and manufacturing-related
applications.

0
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Consumer Industrial
Source: GSMA Intelligence
Note: See Page 23 for definitions of consumer and industrial

 9 | IoT connections overview previous next

 More connected devices within buildings and homes will drive IoT connections growth

The majority of IoT connections growth will come from smart
buildings (5.5 billion net adds) due to the vast number of devices
and assets that businesses can connect within their premises,
including lighting, HVAC systems, security and automation.
This is followed by: smart home (4 billion), where in addition
to home network infrastructure devices, more home security
and energy monitoring devices will be connected; utilities (1.8
billion), driven by the need to monitor resources and reduce
wastage; enterprise others (1.7 billion), with an increasing
number of enterprises deploying fleet management solutions and
connecting assets across agriculture, oil & gas and other verticals;
and consumer electronics (1.6 billion), driven by growing video
consumption over set-top boxes and the proliferation of smart TVs.

Global IoT connections net additions, 2016–2025

30,000
Connected devices (million)

25,000

20,000

15,000

10,000

5,000

0
2016 Smart Consumer Wearables Smart Consumer Smart Smart Smart Smart Smart Health Enterprise 2025
Total home electronics vehicles others cities utilities retail buildings manufacturing others Total

Consumer Industrial
Source: GSMA Intelligence

 10 | IoT connections overview previous next

 Asia Pacific to lead IoT adoption; North America and Europe follow

Asia Pacific will continue to be the largest regional IoT market by
number of connections in 2025, off the back of strong industrial
IoT connections growth, which will be almost double that for
consumer. Northern America will hold second spot due to an
increasing proliferation of connected devices across multiple
industrial verticals.
IoT adoption across developing markets will continue to lag
behind, partly due to affordability. The World Bank estimated
around 11% of the global population were considered extremely
poor ($1.90 income per day per person) in 2017, which limits the
addressable base for device adoption.
(Source: The 2017 global poverty update from the World Bank).

Regional breakdown of global IoT connections

0.50

2016 GROWTH 2025

45%

40%
Asia Pacific 2.3bn 8.7 11.0bn
35%
Northern America 1.6bn 4.2 5.9bn
30%

25%
Europe 1.5bn 3.5 4.9bn

20% Latin America 0.4bn 0.9 1.3bn

15%
Middle East
& North Africa 0.3bn 0.8 1.1bn
10%

5% CIS 0.2bn 0.5 0.7bn

0%
Asia
Pacific
Northern
America
Europe Latin
America
MENA CIS SSA
Sub-Saharan
Africa 0.1bn 0.3 0.3bn
2010 2016 2025
Source: GSMA Intelligence
Note: Totals may not add up due to rounding

 11 | IoT connections overview previous next

 Short range accounts for majority of IoT device connections

The majority of IoT devices – typically in indoor environments – will be
connected by unlicensed radio technologies designed for short-range
connectivity such as Wi-Fi, Z-Wave and Zigbee.
IoT devices that require mobility, lower latency and ultra-reliability will primarily be
connected by cellular networks using licensed spectrum. Cellular networks address
the need for more secure, managed connectivity that can connect directly to the
cloud (as opposed to the gateway) and will be one of the key drivers of growth.
Mobile IoT* networks enable a slew of IoT devices to be connected that
require longer battery life and lower data throughputs. Currently, there are
42 commercial launches of mobile IoT across several countries, including
the US, China and across Europe. We forecast that in 2025, propelled by the
growth of NB-IoT and LTE-M, licensed cellular networks will serve 3.1 billion IoT
connections globally by 2025 or 12% of the total number of IoT connections.

IoT connections by technology, cellular share of total IoT

30,000
Connections (millions)

12%

25,000

20,000

15,000

10,000
7%

5,000
4%

0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Non-cellular Cellular
Source: GSMA Intelligence
*Mobile IoT refers to low power wide area (LPWA) 3GPP standardised secure operator managed IoT networks in licensed spectrum – in particular, LPWA networks designed
for IoT applications that are low cost, use low data rates, require long battery lives and often operate in remote, hard to reach locations.

 12 | IoT connections overview previous next

 Mobile IoT commercial launches

42
Mobile IoT
commercial
launches
as of March 2018

Both LTE-M
LTE-M NB-IoT and NB-IoT
Source: GSMA Intelligence

 13 | IoT connections overview previous next

 1 EXECUTIVE SUMMARY

2 IoT CONNECTIONS OVERVIEW

3 ASSUMPTIONS

4 APPENDIX: METHODOLOGY

 14 |  previous next

 Smart home is the largest source of growth within the consumer segment
00 11,430 Home security: more devices connected to
SMART HOME
security systems
Consumer IoT connections, 2016–2025
10,560
Energy monitoring: cost reduction drives
00 9,665 adoption

Home networking devices: growth

8,751 stimulated by growing broadband adoption

Home appliances: remain a niche market

00 7,833
throughout the forecast period
6,999 Smart TVs: already adopted by up to 50%
CONSUMER
of households in developed markets and
6,189 ELECTRONICS
adoption is set to increase
00 5,381 Home entertainment: connecting more
devices but portable entertainment in
4,608 decline
Million

3,922
00 Set-top boxes: adoption driven by growing
video consumption

Fitness trackers: new form factors can

WEARABLES reinvigorate the market
00 Smart watches: continue to receive a
positive response from the market

Connectivity becomes a standard part of

SMART
OEM offerings
0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
VEHICLES

Consumer Aftermarket solutions still important in

Smart home electronics Wearables Smart vehicles Other emerging markets
Source: GSMA Intelligence

 15 | Assumptions CONSUMER IoT previous next

 Smart home devices account for 1 in 4 connections throughout the forecast period

Smart home connections will number 5.4 billion globally in 2025,
up from 1.4 billion in 2016. While home infrastructure is currently
the largest application, home security devices will be the fastest
growing segment within smart home.
We expect the number of connected home security devices per
household to increase. Energy monitoring will increase six-fold,
reflecting the need to increase energy efficiency and strong
demand for smart plugs. Though increasing 13-fold throughout
the forecast period, home appliances will remain a niche market

SMART HOME
HOME SECURITY ENERGY MONITORING HOME INFRASTRUCTURE HOME APPLIANCES

Includes internet-enabled cameras, Excludes smart meters but includes Includes routers, extenders and Includes connected fridges, washing
security alarms, smoke alarms and smart plugs, lighting, air con and other home networking devices machines, and smaller home
locks thermostats appliances such as coffee machines

• The traditional home security (alarm
monitoring) segment is relatively
mature; now the focus in developed
countries has shifted to replacing
traditional systems with connected
ones.
• Our forecast assumes that there will be
multiple devices connected to a home
security system (e.g. locks, window
sensors).
• Smart plugs are still a relatively new
product and command a significant
price premium over standard devices
(e.g. c$20 each at the low end,
increasing to $65+) but they allow a
certain level of retro-fitting in that older
devices can become “smart”.
• The increasing adoption of home
hubs such as Amazon Alexa and the
integration with other devices in the
home (e.g. through the use of smart
plugs and lighting) results in multiple
devices per household.
• An increasing number of devices
requiring faster broadband result
in households installing extenders
to propagate the Wi-Fi signal. This
is particularly the case in larger
developed markets with high average
property sizes.
• In 2016, mesh networks, e.g. Google
WiFi, NetGear Orbi, came to market –
these are expected to decline in price.
• Niche market with connectivity limited
to high-end devices for major white
goods and some smaller devices (e.g.
coffee machines).
• Most of these devices have much
longer lifecycles than entertainment
devices or smartphones. We do
not expect connectivity to drive a
significant change in replacement rates.

 16 | Assumptions CONSUMER IoT CONSUMER IoT previous next

 Consumer electronics is currently the largest IoT segment

Consumer electronics devices increasingly have connectivity built in
by default, and we expect this segment to grow almost double by
2025. As witnessed at this year’s Mobile World Congress, connected
consumer devices are increasingly being integrated with AI‑based
voice assistants to increase accessibility and user engagement.
Smart TVs will remain the largest category, followed by set-top
boxes and home entertainment. The personal entertainment
segment is in decline due to the growing capabilities of
smartphones.

CONSUMER ELECTRONICS
SMART TV HOME ENTERTAINMENT PERSONAL ENTERTAINMENT SET-TOP BOX

Televisions that can connect directly
to the internet – i.e. independently
from any set-top box, games
console or accessory
Includes games consoles, audio/
HiFi systems, speakers, DVD/Blu-ray
players, printers, home hubs
Includes portable games consoles,
MP3 players/iPods, cameras
Includes devices that allow
downloading or streaming of
television content: set-top boxes and
streaming devices (Amazon Fire TV,
Apple TV, Roku etc)

• Smart TV adoption has increased as
part of existing replacement rates, with
some peaks as a result of major sporting
events.
• GSMA Intelligence’s Consumer Survey
data shows that in developed markets
up to 50% of households already have a
smart TV and more households are set
to replace their existing TVs with smart
ones. Developing markets will have a
much lower smart TV penetration (some
still below 10% in 2025).
• Survey data shows developed markets
are already at 50%+ household
penetration. Games consoles represent
a significant proportion of the existing
base but exhibit limited growth
potential as demand flattens.
• Penetration and number of devices
per household set to gradually rise as
existing home entertainment devices
are replaced with connected ones.
• Adoption of connected personal
entertainment devices increased until
2012, but shipments then declined as a
result of the increased functionality and
memory of smartphones.
• We expect this trend to continue as the
capability of smartphones (and even
high-end feature phones) increases,
resulting in less consumer interest in
standalone music and gaming devices.
• Most pay-TV providers provide a box
to decrypt the television signal that has
built-in internet connectivity.
• We expect set-top box adoption to
continue to increase as households
upgrade to those with enhanced
functionality, adopt multi-room services
(i.e. more than one box per household)
and/or purchase additional streaming
devices.

 17 | Assumptions CONSUMER IoT CONSUMER IoT previous next

 Connectivity on the move drives adoption of wearables and connected vehicles

We expect the adoption of wearables (smart watches and fitness
trackers) to continue to gain traction, increasing four-fold to
1 billion by 2025. New functionality will emerge, and the devices
will increasingly become part of health insurance schemes in
developed countries.
At the same time, connected vehicles will grow three-fold to
1.2 billion connections as embedded mobile connectivity is
installed at the point of manufacturing and many new vehicles
come with these features by default.

WEARABLES CONNECTED VEHICLES

SMART WATCH FITNESS TRACKER CONNECTED CAR CONNECTED BIKE

Includes devices with a touchscreen Includes devices that can be worn Includes built-in connectivity in cars Includes built-in connectivity in
display, designed to be worn on the and used for monitoring and tracking and related aftermarket telematics bikes and motorbikes and related
wrist (e.g. Apple Watch) fitness (e.g. Fitbit, Jawbone, Galaxy devices such as for personal aftermarket telematics devices such
Gear) navigation as for insurance

• We project smartwatch penetration to
continue to increase but not beyond
20% of population in developed
markets. While initial take-up has been
positive, the potential for additional
functionality seems limited; a rapid
move to mass adoption is not expected.
• We do not expect the average number
of devices per person to increase
significantly above one.
• Wrist-worn fitness/health trackers are
likely to gradually merge with the smart
watch category (Apple Watch can offer
much of the functionality of a Fitbit).
We do not expect this convergence to
cause a decline as we expect new form
factors to emerge – e.g. fitness trackers
as part of sports clothing.
• New form factors will be able to
measure different indicators
(e.g. posture, gait) and offer more
health-related functionality.
• A growing number of new cars are • Vehicle tracking is the main use
equipped with factory-fitted cellular case and will largely rely on cellular
connectivity designed to meet demand connectivity. Other connected features
among regulators and consumers and functionality will be centred on
for safety and security features, telematics / performance measurement.
infotainment and navigation services.
• Similar opportunity around insurance
• Insurance telematics (pay-as-you-drive and driving monitoring.
insurance) will continue to gain traction.
• Note: This does not include
• Across emerging markets, stolen infrastructure supporting rented bikes.
vehicle recovery continues to be an
important avenue of growth.
• Other connected features and
functionality will be centred on
telematics / performance measurement.

 18 | Assumptions CONSUMER IoT CONSUMER IoT previous next

 Smart buildings to account for almost half of industrial connections
00 Industrial IoT connections, 2016–2025
13,761

11,892 SMART Energy efficiency initiatives provide boost

00 BUILDINGS to adoption

10,106 SMART Steady growth driven by the need to

UTILITIES monitor resources and reduce wastage

00 8,451 ENTERPRISE Proliferation of connected devices driven by

OTHERS productivity gains

6,974
Adoption slows as emerging markets look
SMART RETAIL
to cheaper alternatives
00 5,701
Growing number of initiatives across the
4,602 SMART CITIES
globe but siloes remain
3,685
Implementation driven by productivity gains as
2,961 SMART
Million

00 2,388 MANUFACTURING enterprises pursue the fourth industrial revolution

Adoption hampered due to regulatory

HEALTH
approval requirements

0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Smart Smart Enterprise Smart Smart Smart
buildings utilities others retail cities manufacturing Health
Source: GSMA Intelligence

 19 | Assumptions INDUSTRIAL IoT previous next

 Smart city connections will increase seven-fold as deployments move away from trials to implementation

Smart buildings will be the largest industrial segment, accounting
for almost half of connections by 2025 as workplaces connect
more devices and the majority of new buildings adhere to energy
efficiency standards.
Smart city deployments continue to address particular city needs.
As seen at Mobile World Congress 2018, a number of vendors
and operators are providing real-life examples of how big data
analytics can positively impact the daily lives of citizens and
improve knowledge around air quality and levels of congestion.

SMART BUILDINGS SMART CITY SMART UTILITIES SMART RETAIL

Includes heating and air con, Includes public transport, street Includes energy, water and gas Includes points of sale, digital
security, lighting, office equipment lighting, parking, surveillance smart metering, smart grid signage, vending machines, ATMs

• Enterprises connect more devices and
assets within their buildings, including
lighting, HVAC systems, security and
automation. This includes smaller
enterprises, which occupy multitenant
offices retrofitted with connectivity.
• Connected luminaires represent the
largest and fastest growing segment,
driven by energy efficiency and cost
saving.
• Adoption increases as part of
existing efforts by governments and
municipalities to improve traffic flow,
increase safety and reduce costs.
• More cities are developing and
implementing smart city initiatives,
including China (part of the 13th Five
Year Plan), Singapore (Smart Nation),
India (100 Smart Cities Mission), Dubai
and Qatar.
• In terms of adopting M2M technologies,
the utility sector is relatively mature.
Utilities around the world continue to
install smart meters that can monitor
customers’ use of energy or water
in near real-time, cutting costs and
helping balance supply and demand.
• In emerging markets, the objective
is to connect the unconnected to
the electricity grid by utilising solar
technology, IoT and mobile money.
• Adoption of connected devices in
retail will continue to increase due to
the proliferation of credit cards and
cashless payments.
• Across developed countries, there is
a move away from passive screens
to digital signage for advertising and
connecting vending machines, allowing
for inventory management, trend
marketing and monitoring of user
preferences.

• Growth in traditional point-of-sale

devices will slow; some developing
markets – where the majority of growth
will come from – are leapfrogging
the card stage and moving to other
payment methods.

 20 | Assumptions INDUSTRIAL IoT INDUSTRIAL IoT previous next

 Manufacturing grows at the fastest rate in industrial IoT, boosted by the fourth industrial revolution

We expect manufacturing and other industrial verticals, captured
under Enterprise others, such as agriculture and asset tracking,
to be driven by falling hardware costs, improved battery life and
the emergence of low-power technologies. As such, we forecast
smart manufacturing to increase 12-fold while Enterprise others
will grow five-fold.
Industrial IoT was a key theme at Mobile World Congress
2018, with key players such as AT&T, Dell, Deutsche Telekom,
Ericsson, Huawei, IBM, Intel and Nokia demonstrating a range of
applications across various industrial verticals.

SMART MANUFACTURING HEALTH ENTERPRISE OTHERS

Includes inventory tracking, monitoring and Includes medical devices and those used for Includes fleet management and IoT applications
diagnostics, warehouse management chronic disease management but not fitness and that fall outside other verticals, such as
wellbeing monitoring devices agriculture, oil, mining and construction

• Supported by the fourth industrial revolution
movement, manufacturing companies are increasingly
adopting and applying advanced robotics, AI, sensors,
analytics and dedicated platforms for the operation
of manufacturing facilities, asset and inventory
management and maintenance, logistics and supply
chain. For example, in 2017 Verizon reported an 84%
year-on-year increase in IoT connections related to
manufacturing.
• A number of countries have strategies in place to drive
adoption of IoT in manufacturing – notably Germany,
the US, Japan, China, the Nordics and the UK.
• An ageing population, high costs associated with
health expenditure and medication adherence are
some of the driving forces behind the adoption of
remote health monitoring in developed markets.
• In emerging markets, IoT deployments can address the
lack of healthcare infrastructure and shortage of skills,
providing greater medical access.
• Many challenges still need to be resolved, such as
device certification, liability, compliance, and data
security and ownership.
• Enterprises have already adopted fleet management
to improve efficiency, proof of delivery and driver
productivity by using applications that streamline
dispatch, routing, tracking and reporting.
• Although small in size, IoT adoption across the oil &
gas sector has been on the rise due to operational
efficiency needs, safety and environmental concerns
and regulatory compliance.
• Adoption in agriculture remains limited but this
sector will grow as demand for precision agriculture
increases, especially across the Americas; e.g. in
the US, the agriculture and food industry deploy
sensors to monitor production conditions, delivery
time and additional metrics to conform to new
reporting requirements under the 2015 Food Safety
Modernization Act.

 21 | Assumptions INDUSTRIAL IoT INDUSTRIAL IoT previous next

 1 EXECUTIVE SUMMARY

2 IoT CONNECTIONS OVERVIEW

3 ASSUMPTIONS

4 APPENDIX: METHODOLOGY

 22 |  previous next

 IoT definition and segmentation

GSMA Intelligence defines Internet of Things (IoT) devices
as those capable of two-way data transmission (excluding
passive sensors and RFID tags). It includes connections using
multiple communication methods such as cellular, short range
and others. It excludes PCs, laptops, tablets, e-readers, data
terminals and smartphones.
GSMA Intelligence segments IoT into two broad categories:
consumer and industrial. Our distinction is primarily based on IoT
device ownership but we recognise that “consumer” is a loose
term as some devices, e.g. smart TVs, could be used in non-
residential environments.

Category Sub-category
Consumer electronics Smart TVs, home entertainment (games consoles, speakers), personal
Consumer IoT
entertainment (MP3 players, portable gaming devices), set-top boxes
Smart home Home appliances (fridges, washing machines), home infrastructure
(routers), home security (alarms), energy monitoring (thermostats)
Wearables Fitness trackers (including personal health trackers), smart watches
Smart vehicles Connected cars, connected bikes, insurance telematics
Consumer – others Trackers for children, the elderly and pets, as well as drones and robots
Smart city Public transport, surveillance, electric vehicle charging, street lighting,
Industrial IoT
parking, waste management
Smart utilities Energy, water and gas smart metering, smart grid
Smart retail PoS, digital signage, vending machines, ATMs
Smart manufacturing Inventory tracking, monitoring and diagnostics, warehouse management 
Smart buildings Heating and air con, security, lighting, hot desks, office equipment
Health Remote monitoring of medical devices, emergency vehicle infrastructure
Enterprise – others Fleet management, applications in agriculture, oil, mining, construction

 23 | Appendix: Methodology previous next

 Methodology 1

PURE TOP DOWN ANALYSIS

The GSMA Intelligence IoT connections dataset is based on a

proprietary forecasting methodology that combines multiple
approaches to market sizing.
SUPPLY SIDE ANALYSIS

DEMAND ANALYSIS
Inputs to the model include GSMA Intelligence datasets such
as cellular M2M connections, Consumer Survey data from
50 countries (representing 79% of the global population) in
developed and developing markets, and household, enterprise and
manufacturing enterprise numbers; as well as external datasets,
including population data and percentage splits of urban and rural
populations.

Our forecast assumptions were also informed by qualitative

information sourced from vendor reports, presentations,
ecosystem engagement and industry interviews.

FULL BOTTOM UP ANALYSIS

 24 | Appendix: Methodology previous next

 Methodology 2
Consumer IoT
The GSMA Intelligence Consumer Survey provides guidance on core
country adoption of smart devices per household (and number of
smart devices per household). The data from the survey was sanity
checked and cross-referenced with shipment estimates to allow for
a top-down view. GSMA Intelligence undertook a detailed analysis of
the sectors and their drivers to form guiding principles for forecasting
each sub-category (e.g. smart TV). We then used benchmarking and
indexes (Consumer IoT Readiness Index) to extrapolate from key
countries to the remaining countries. We undertook further sanity
checking to reconcile global estimates with top-down shipment data.
 25 | Appendix: Methodology
Industrial IoT
Adoption scenarios were created and applied to base data (number
of businesses, manufacturing enterprises, urban population etc.) for
core countries. We then established guiding principles for forecasting
each sub category (e.g. smart city) and extrapolated to non-core
markets using our proprietary Enterprise IoT Readiness Index. We
also conducted additional research to sanity check bottom-up,
country‑level estimates.
previous next
 IoT Readiness Index

The IoT Readiness Index is an input
index. It measures the performance of a
range of key metrics that we believe are
essential to creating an effective enabling
environment for IoT adoption, across
consumers, enterprises and governments.
Scores for each of these enablers are
combined to produce a single composite
measure for a given country of the
strength of the foundations to support
adoption of IoT. This in turn allows us to
rank countries to assess aptitude for IoT
services implementation.
We have created two indexes to inform
our forecasting: the Consumer IoT
Readiness Index and the Enterprise IoT
Readiness Index, which build on the
enablers highlighted below.

INFRASTRUCTURE AFFORDABILITY CONSUMER READINESS ENTERPRISE READINESS

• Enabling infrastructure • Income • Basic skills • Productivity

ENABLERS
• Telecommunication • Inequality • Digital literacy • Industry segment
infrastructure contribution to
• Tariffs and prices
economy
• Taxation

 26 | Appendix: Methodology previous next

GSMA Intelligence

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