IoT to Account for 28% of Wireless Connectivity IC Market by 2021; Driven by Fast-Growing Smart Home, Wearables, and Beacons

London, United Kingdom - 27 Apr 2016

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ABI Research, the leader in transformative technology innovation market intelligence, finds that smart home, beacon, wearable, and other nascent IoT applications including energy management and smart cities are to propel the wireless IoT connectivity market forward. The market’s trend toward multi-protocol connectivity IC adoption will ease development time, boost scale, and reduce complexity and cost for manufacturers across these different sectors in the years ahead.

“2015 witnessed a growing trend toward the development of multiprotocol connectivity SoCs for the IoT, some of which support both Bluetooth Smart and 802.15.4,” says Andrew Zignani, Industry Analyst at ABI Research. “Devices that incorporate multiprotocol chipsets will be more futureproof. While a product might utilize Bluetooth in the short term, a device manufacturer may want to switch to Thread in the future or have the ability to talk to multiple connectivity protocols once deployed.”

Moving forward, it might not be a case of either Bluetooth or ZigBee or Thread, but rather utilizing a combination of these technologies in a single device. The recently announced acquisition of GreenPeak by Qorvo and the resulting expansion in their RF portfolio with low-power SoCs, 802.15.4, and Bluetooth solutions, illustrates the growing importance of both of these technologies for the IoT.

ABI Research also expects to see a growing presence of smart home hubs that incorporate multiple connectivity solutions such as Wi-Fi, Bluetooth Smart, Z-Wave and 802.15.4 (ZigBee/Thread). These solutions will have a significant role to play in the development and consolidation of wireless connectivity solutions for the smart home. These hubs are already being already offered by the likes of Google, Samsung, and Huawei.

ABI Research forecasts that Bluetooth smart home devices will show a 75% growth rate between 2016 and 2021, though 802.15.4-based ZigBee and Thread will lead with 34% volume share of the home automation and 29% of the smart lighting markets by this time. 802.15.4 will also see growth in smart metering, building automation, industrial, and street lighting market, accounting for almost one third of 802.15.4 shipments by 2021.

A majority of fitness and activity trackers are utilizing Bluetooth Smart, with the solution extending to medical applications moving forward. It also promises significant opportunity for beacons across numerous verticals, such as retail and advertising, with ABI Research forecasting a 129% growth rate between 2016 and 2021. However, looking ahead there will be increasing competition in the connectivity sphere across numerous IoT verticals.

“Wi-Fi HaLow, or 802.11ah, operating in the sub-1GHz band will be of increasing importance for the Wi-Fi Alliance and chipset suppliers over the coming years as it tries to target various IoT verticals with low-power requirements,” concludes Zignani. “These solutions will also face new challenges from LPWAN technologies, such as Sigfox and LoRa, but most importantly, by emerging cellular technologies, such as NB-IOT and eMTC.”

These findings are part of ABI Research’s IoE Semiconductors Service and Wireless Connectivity Service, which includes research reports, market data, insights, and competitive assessments.

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About ABI Research

For more than 25 years, ABI Research has stood at the forefront of technology market intelligence, partnering with innovative business leaders to implement informed, transformative technology decisions. The company employs a global team of senior analysts to provide comprehensive research and consulting services through deep quantitative forecasts, qualitative analyses and teardown services. An industry pioneer, ABI Research is proactive in its approach, frequently uncovering ground-breaking business cycles ahead of the curve and publishing research 18 to 36 months in advance of other organizations. In all, the company covers more than 60 services, spanning 11 technology sectors. For more information, visit www.abiresearch.com.