Internet of Things (IoT) Predictions for 2016

This year, nearly every major intelligence gatherer/analyst is jumping on the IoT bandwagon making forecasts about where IoT is heading in 2016 including Gartner, IDC, Forrester, WEF and Machina Research. We did the same thing to bring to you what we think are the best-of-the-best predictions for IoT trends on 2016.

IoT Enterprise Adoption Reaches a Tipping Point

The major thrust for IoT continues to come from the enterprise side versus the consumer side of the markets. According to Forrester, over half of businesses are already utilizing IoT or will within the coming year. Most of these enterprises are leveraging IoT to optimize use of company assets or as part of a transition from discrete products to product-based services. Further accelerating this trend will be the emergence this year of end-to-end IoT platforms that will go a long way to reducing the potential complexity of creating IoT apps and services.

Consumer Awareness Is on the Rise

On the other hand, 2016 is a marker year in IoT consumer awareness as most customers are now explicitly inquiring about the number and types of sensor/communication technologies that are embedded in new products from kitchen appliances to home security systems to automobiles. Companies this year are more than ever touting their products’ “connectedness” and home insurers are offering discounts to smart house homeowners.

Semiconductor Companies Are Jumping In

Intel especially has come to recognize that IoT is a hugely expanding market for them that could offset their shrinking sales in the PC market. IoT was a major consideration in their acquisition of semiconductor company Altera last year. This year they are developing complete IoT devices including sensors, embedded CPUs and communications. They are putting strong focus on applying their newly-found IoT expertise in the retail sector as evidenced by recent partnerships with SATO and RetailNext.

IoT Player Consolidation

Other big-tech companies are positioning themselves for IoT growth by acquiring smaller players, and that will accelerate in 2016. Cisco bought out IoT analytics company Parstream in late 2015. More recently, they acquired the largest IoT platform provider in the world, Jasper. Sony is acquiring chip company Altair Semiconductors, which is a leader in modern chip processes and cellular technology.

Keep your eye out for several rumored acquisitions coming this year including FireEye, Proofpoint, Fortinet and CyberArk.

The Numbers Continue to Astound

If the previous predictions seem a disputable, here are some hard numbers predicted by Gartner for the coming year:

  • 2016 will see 6.4B “things” connected worldwide
  • Over 5 million of these “things” will be connected every single day
  • Between consumers and enterprises, IoT hardware spending will exceed $1.4B
  • IoT service spending will be 22 percent higher than last year and total $235B
  • The downers are that there will be a multi-billion black market spawned that sells fake IoT data, personal privacy breaches will increase and the vast majority of IoT projects will take far longer than planned.

Public Sector IoT Accelerates

Smart Cities, Smart Grids, Smart Buildings are all areas that are accelerating this year, especially in Germany and Scandinavia. Finland, for example, uses trash can sensors to reduce the costs of garbage pickup by 30 percent. Although the trend in public sector IoT began in Europe, it is accelerating in the Asia/Pacific region as well as in North America.

This year governments across the globe are starting to implement IoT rather than just talk about it. They are connecting motion sensors to streetlight to save energy, distributing smart parking apps that monitor when spaces free up and are employing IoT to optimize the use of and to share public services assets such as road equipment and transportation.


Underlying mega-trends continue to pump juice into IoT, such as cheaper sensors, processors, bandwidth, the long-awaited move to IPV6 and various types of wireless coverage in every nook and cranny.

A few holdouts still see IoT as nothing more than an already flat fad given that the IoT equivalent of “flying cars” is still not on the horizon. However, in the face of the numbers and moves by some of the biggest tech companies, it is hard to take these critics too seriously.

So far, the reports of IoT’s demise are supremely exaggerated and many past predictions have been exceeded already. IoT will surely experience bumps and jolts along the way to the prediction by IDC that IoT spending will surpass $1.7 trillion by 2020, but for this year and beyond it appears to be an unstoppable wave that is far from cresting.