Global IoT Market Projected to Hit 40 Billion Connections by 2033

Transforma Insights recently released its ‘Global IoT Forecast Report, 2023-2033,’ offering a comprehensive overview of the global Internet of Things (IoT) market. The report highlighted that by the end of 2023, there were 16.1 billion active IoT devices, a number expected to reach 39.9 billion by 2033, representing a compound annual growth rate (CAGR) of 10%. Annual device sales are projected to rise from 4.1 billion in 2023 to 8.7 billion in 2033, with a CAGR of 8%.

The report revealed that short-range technologies will continue to dominate IoT connections, accounting for 73% by 2033, down slightly from 79% in 2023. Cellular connections are set to grow from 1.9 billion to 7.5 billion over the same period. Notably, by 2033, 5.5 billion of these will be 5G connections, although only 1.1 billion will be ‘full’ 5G New Radio (NR), with the rest comprising mMTC technologies such as NB-IoT and LTE-M. Vehicle head units will be the largest non-mMTC 5G use case, making up 41% of connections in 2033.

Other Low Power Wide Area (LPWA) technologies like LoRaWAN are also expected to grow significantly, from 360 million in 2023 to just over 2 billion in 2033. In revenue terms, the IoT market, including connectivity modules, value-added connectivity, and core applications, was valued at USD 335 billion in 2023, a figure projected to rise to USD 934 billion by 2033. Value-added connectivity will constitute 10% of spending, with connectivity modules accounting for an additional 4%.

The consumer sector will dominate the IoT landscape, representing 61% of all connections by 2033. In the enterprise segment, cross-vertical use cases like generic track-and-trace and office equipment will make up 35% of devices, utilities 24%, retail/wholesale 22%, government 7%, transport and logistics 4%, and agriculture 3%. Geographically, China, North America, and Europe will lead the market, comprising 32%, 21%, and 19% of the total value, respectively.

Commenting on the findings, Principal Analyst Matt Arnott said: “The growth in adoption IoT continues at a steady pace, reflecting the diversity of use cases encapsulated within the concept. It’s not a hockey stick and never has been, but a series of micro-markets that each have their own dynamics, with some growing faster and others slower. There are micro-level factors that can massively accelerate growth such as the requirement in Spain to adopt breakdown beacons, and there are notable macro-level trends which will also have knock on effects on growth, such as populations aging even faster than expected. To forecast the IoT market you need to understand both, and much more besides.”

Matt Hatton, Founding Partner at Transforma Insights noted: “Transforma Insights analysts have been forecasting the Internet of Things market opportunity for over a decade. Back in 2011 our analysts’ expectation of 12 billion IoT devices by 2020 was close to the bottom of the league table of predictions but proved to be easily the most accurate. Today as Transforma Insights our team continues to provide the most extensive and deeply researched forecasts of the IoT, making ours the benchmark against which all predictions of IoT market growth should be compared.”

See the full Global IoT Forecast Report, 2023-2033 report here.