IoT profits
13 Key Facts the Channel Should Know About IoT
Forget the hype. The internet of things offers significant money-making opportunities for the channel.
Big Opportunities in IoT
The number of things connected to the Internet will reach 34.8 billion in 2016 and 50.1 billion by 2020, according to CompTIA. Total services spending for the IoT sector is expected to reach $235 billion by 2016, up 22 percent from 2015, according to Gartner.
IoT Initiatives Under Way
60% of end-user organizations have some type of IoT initiative under way. Funding will come from new budget allocation (45%), existing IT budget (36%), budget repurposed from cost savings (10%) and a combination of sources (7%).
Signs of Interest in IoT
Channel firms believe that 10% of their clients are heavily integrating IoT components, 23% are pursuing initial implementation of IoT components, 44% are in the early exploration and education stage, and 22% show no interest.
Where the IoT Profits Will Be
Channel firms believe IT solution providers/MSPs will profit the most from IoT initiatives (36%), followed by data analytics/big data companies (35%), networking equipment/software firms (34%), device companies (33%) and app developers (30%).
Gaining Traction in IoT
39% of channel firms report a significantly more positive view of IoT, 36% have a slightly more positive view and 21% have not changed their views, compared to one year ago.
IoT Money Makers in the Channel
A little more than a third (36%) of large channel firms are already making money from the IoT, compared with 15% of midsize channel companies and 15% of small channel companies. Looking ahead, 39%, 40% and 25%, respectively, expect to make money in the next 12 months.
Popular IoT Channel Offerings
The two most popular IoT channel offerings are consulting (40%) and security (36%) services. Others include analytics, managed services, custom apps, reselling and infrastructure services.
IoT Benefits for the Enterprise
49% of channel companies said the biggest use potential for IoT is creating new opportunities from connected systems, followed by controlling/monitoring equipment (48%), collecting new data (46%) and gathering contextual information about customers (43%).
Channel Benefits
Channel firms report the top perceived benefits of IoT include new and better customer experiences (41%), better asset visibility/monitoring (40%), cost savings/higher efficiency (39%), new product/service revenue (37%) and new/better data for decisions (37%).
Channel Roadblocks
55% of channel firms said developing expertise is their top challenge, followed by initial costs (50%), educating customers (51%), choosing a business model (49%), choosing vendors (49%), cash flow considerations (47%) and optimizing sales/marketing.
End-User Challenges
49% of channel firms perceive cyber-security risks as the top challenge for end users, followed by legacy interoperability (37%), ongoing costs (36%), steep learning curve (36%), quantifying ROI (34%), up-front investment (32%) and the inability to absorb data (21%).
Need for IoT Skills
Less than one-third of channel companies viewed themselves as experts in several areas used for building IoT solutions, including cloud computing, data analysis, storage, networking and security.
Split Views on IoT Security
49% of channel firms believe security/privacy are primary factors to consider during adoption while 37% said the benefits of connected devices outweigh concerns.