Which IoT Verticals are Most Promising?

By some estimates, about 10 percent of the value and revenue generated by a single IoT sensor comes in the form of the sensor connection. All the rest of the value generated by use of sensor comes elsewhere.

In fact, some argue, only about two percent of the complete value of insights gleaned from the use of sensors comes from spending on the connectivity for the sensor.

Other analyses suggest connectivity could generate as much as 30 percent of total value, but few seem to believe that is likely.

Most would likely agree that the actual solution itself will provide the most value, and generate the largest single share of revenue within the ecosystem. Services related to installing and operating such applications generally are viewed as important revenue streams as well.

source: Analysys Mason

So, as hard as it might be, it makes sense for connectivity providers to seek additional roles, to provide greater value, in IoT. That is not to discount the traditional horizontal business model (sell SIMs, or connections, rather than vertical solutions).

No single telco can be a value-added supplier in every vertical, so horizontal sales of basic connectivity still will make sense in many, if not most cases. But at least some larger telcos will seek to add more value, to increase value and revenue opportunities.

source: Bain

So far, industrial internet of things and connected vehicles have emerged as early areas of interest. Industrial IoT is widely acknowledged to be among the largest market opportunities, so the interest in that vertical is clear. The automotive vertical might not stand out in terms of its potential size.

What the automotive IoT opportunity does represent is the purest and strongest case for use of the mobile platform, compared to all others.

Satellite is the only choice for ocean-based applications and other really-remote settings. In-home and in-office or in-factory applications can be addressed by several different platforms, including local wireless platforms such as Wi-Fi.

source: Bain

But the mobile network is the obvious choice for vehicle IoT, which will require support for outdoor, moving vehicles as well as edge computing (both onboard the vehicle--device edge-- as well as network edge).