According to a new report by telecommunications consultants STL Partners, by the end of the decade, approximately 3.3 billion Internet-connected devices (IoT devices) will trade money and data directly.
That’s more than 88 million devices next year, an increase of 3,750% in about six years, or “blind growth,” as the authors of the report put it.
This practice is called the economy of things (EoT). Researchers say this IoT subset will account for more than 10% of the total IoT market and will record a compound annual growth rate (CAGR) of 68%.
Cars and charging stations trade data and money
While all kinds of internet-connected devices will constitute EoT, most of the data is expected to come from connected vehicles, the report goes on to say.
The logic of the forecast is that vehicle telematics is already “relatively mature” and the data connected by vehicles is valuable to others in the ecosystem. Explaining how EoT could work in the automotive industry, researchers say connected vehicles can communicate and coordinate with charging points, parking space sensors and traffic lights directly via EoT.
In addition, STL Partners predicts over 1.2 billion EoT-enabled smart network devices by 2030, representing 40% of the total capacity forecast, as well as 700 million supply chain devices. In this industry segment, AI-based tools can analyze IoT-generated data to anticipate spikes in power demand and sell spare capacity back to the grid.
Vodafone is one of the organizations that anticipate the growth of the EoT market and to this end it built an EoT platform called Digital Asset Broker last year.
Other companies keeping an eye on the burgeoning EoT sector include banks and financial organizations. Mark Williamson, Global Head of FX Partnerships & Propositions, HSBC, said: “EoT offers so many opportunities that it is important to think about where it will grow rapidly in its early stages. There is a lot of interest and penetration in the automotive and EV world and this will be a key starting point.”