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Industrial IoT Applications will Blossom in Asia-Pacific

The Internet of Things (IoT) and the manufacturing sector are destined to collide, as more companies with factories explore the benefits of new technologies. This year we're going to witness how forward-thinking manufacturers innovate and grow.

Though industrial manufacturers are somewhat slow in their adoption of cloud-based services and connecting their legacy systems to digital networks, the vision for a vast IoT market is finally starting to take shape.

Industrial manufacturing applications will generate more than $138 million this year from cellular and satellite connectivity fees, according to the latest market study by ABI Research.

Industrial IoT Market Development

The industrial IoT (IIoT) market will add more than 13 million new wireline and wireless connections worldwide in 2017 to an installed base exceeding 53 million connections.

"The costs for data storage and compute processing dropped significantly in the past few years making the digitization of industrial equipment now possible for nearly every manufacturing business," said Jeff Orr, research director at ABI Research.

According to the research findings, new commercial applications are now possible -- including predictive analytics, digital twin simulation modeling, and gaining insight that enables new business models and sources of revenue.

Most IIoT connections are made using fixed line (DSL, cable modem, Ethernet, and PSTN) deployments. However, wireless connections will account for approximately 25 percent of new IIoT connections in 2017.

Mobile network operators across the globe continue to shift their networks away from 2G technologies toward 4G LTE. Within the industrial manufacturing sector, connections are also increasing their use of low-power wide area (LPWA) technologies, which will see the most growth over the next four years for all IIoT connection types.

The Asia-Pacific region has the largest concentration of new IIoT connections with more than five million additional expected in 2017. Moreover, the global opportunity will continue to grow during the next four years with a forecast of 18 million new IIoT connections annually by 2021.

Although some compression is expected for connection-related revenues during the forecast period, which will decline to $122 million in 2021, according to the ABI Research assessment.

Outlook for IIoT Application Growth

"Manufacturers historically isolated their factories, plants, sites, and facilities from data connections, but significant opportunity remains for these organizations to leverage the benefits of a digital network and enable first-time connections," concludes Orr.

As IIoT connections increase, manufacturers will be able to extract data for use in analytics software applications and ultimately provide better machine-level communications to improve workflow. The cognitive era of manufacturing will also create new opportunities for the forward-looking vendors.

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