The global internet of things (IoT) managed services market is forecast to more than triple by 2025 to reach US$166.7 billion.
This is according to analyst firm Frost & Sullivan, which claimed the five-year outlook for the market would be more than triple that of 2020's value, which reached US$53.6 billion.
Broadly, growth in the managed services market will rise due to increased IoT adoption by companies looking for services related to assistance across connectivity, cyber security, data management, device management and infrastructure management, the firm claimed.
“While the recent pandemic adversely affected expansion across verticals, the impact is expected to be short to medium term, and businesses will recover," said Deepali Sathe, senior industry analyst at Frost & Sullivan.
"Technology adoption across verticals has been increasing as the benefits of IoT are quantified for companies to move from pilot and proof-of-concept stage to implementation. Almost all verticals, such as manufacturing, retail, healthcare, utilities, and energy, are expected to regain strong growth trajectories,” she said.
The research — which covered Asia Pacific (APAC), North America, Latin America, Europe, the Middle East and Africa — found that APAC is expected to be the fastest growing region for the market, followed by North America.
Meanwhile, infrastructure development and regulations face regional disparities, which is a challenge for mobile network operators — an important role within paid IoT connectivity, the research noted.
Sathe said while some APAC countries are ahead due to governments promoting infrastructure development, parts of Asia, Latin America and Africa lag behind, as 2G and 3G form the bulk of connectivity infrastructure in these regions.
North America and Europe however lead the pack in relation to 5G, LTE-M and Narrowband-IoT deployment, but high spectrum costs will result in higher cost of services, in turn affecting providers.
Also impacting the IoT industry, the firm claimed, is the lack of standardisation, resulting in an “extremely” fragmented ecosystem, with users having trouble with finding interoperable solutions and devices that are compatible with existing systems.
To tackle that ecosystem as well as capitalising on the growth prospects in the market, Frost & Sullivan proposed that IoT managed services providers should consider private mobile networks, eSIMs and iSIMs, as well as intelligent edge.
For example, the firm suggested that vendors looking to deploy private mobile networks have the potential to provide growth opportunities, as they would be seeking out partners that offer relevant connectivity solutions.
Meanwhile, providers of eSIMs and iSIMs will be able to leverage the growth opportunity of digitial-first devices being launched into the market. Additionally, intelligent edge has the potential to reduce costs, latency and security risks, Frost & Sullivan claimed.