London, United Kingdom - 12 Sep 2019
Projected growth across several areas including the smart home, wearables, beacons, healthcare, smart cities, automotive, and commercial building automation, are beginning to help accelerate Wi-Fi and Bluetooth’s share of shipments transition away from smartphones and consumer electronics toward IoT devices. According to global tech market advisory firm ABI Research, by 2024, IoT end markets will represent 31% of total Bluetooth and 27% of Wi-Fi device shipments, up from 13% and 10% respectively in 2018.
Smartphones will continue to be important markets of strength for both Wi-Fi and Bluetooth, however, when it comes to the Bluetooth shipments, the IoT market is expected to overtake the smartphone market for the first time in 2024 as its share of the market falls to less than 30%. The share of smartphones as a proportion of Wi-Fi device shipments is also set to fall below 40% by 2024. “Bluetooth will continue to grow in other areas, such as speakers, headsets, mobile and PC accessories, and both technologies will continue to push into other consumer electronics devices such as connected toys and home entertainment. However, the IoT is beginning to take an increasingly significant share of the market,” says Andrew Zignani, Principal Analyst, ABI Research.
Key IoT opportunities for Bluetooth will be found within asset management and location services in devices such as beacons and personal trackers. These are anticipated to grow from around 2% of the Bluetooth market in 2018 to over 8.5% by 2024. Bluetooth enabled wearable devices are also expected to break the 400 million device barrier by 2024, with increased traction in smartwatches, activity trackers, smart clothing, and hearables. Wi-Fi-enabled wearables are also expected to reach over 250 million units by this time. The smart home will be one of the quickest growing markets for both Wi-Fi and Bluetooth technologies. Wi-Fi-enabled smart home devices are expected to grow from 5% in 2018 to nearly 16% by 2024 and Bluetooth will rise from 4% to 13% in the same period, with traction in voice-control front ends, smart appliances, smart lighting, sensor devices, video cameras, and others.
From a Wi-Fi perspective, Wi-Fi 6 undoubtedly has enormous potential in the IoT space thanks to new enhancements such as target wake time, OFDMA, and narrowband implementations. However, ABI Research believes that the transition away from 802.11n in favor of Wi-Fi 6 will take some time. “802.11n is a very well-established technology available at very low cost from a wide number of vendors while new chipsets driving down power consumption are continuing to arrive to the market. Many industry players are still having product discussions leveraging 802.11n and expect this to continue for some time. In addition, some regions, such as China, are more conservative on newer technologies,” Zignani says. “Much of the initial marketing around Wi-Fi 6 has been at the higher end with limited focus on IoT applications. While this is understandable given the initial rollout in networking, laptop and smartphone clients, much needs to be done to educate the industry around the other benefits that Wi-Fi 6 can bring about for battery constrained IoT devices. However, as 802.11ax chipset prices fall and vendors refine their product lines to support IoT clients, this is likely to change. ABI Research expects the IoT market to transition toward Wi-Fi 6 in earnest within 2-3 years,” Zignani adds.
Chipset availability for 802.11ah, also known as Wi-Fi HaLow, is still very limited. Many HaLow ICs are still in development and most of these are from startup companies – in fact, many of the traditional Wi-Fi IC vendors are not backing the technology and do not have any HaLow ICs on the market. However, the first products are finally beginning to arrive from the likes of Newracom, and the next 12-18 months will be crucial in establishing HaLow’s position in the IoT landscape.
“While the connectivity chipset market is currently dominated by Qualcomm, Broadcom, and MediaTek thanks to their entrenchment in the smartphone market, the IoT opens the competition to a wider range of chipset vendors who are exploring different dimensions of differentiation. These include companies like Cypress (recently acquired by Infineon), Silicon Labs, Nordic Semiconductor, Dialog Semiconductor, NXP, STMicroelectronics, TI, On Semiconductor, u-blox, and Atmosic, among others,” Zignani adds.
These findings are from ABI Research’s Wireless Connectivity Technology Segmentation & Addressable Markets market data. This report is part of the company’s Wi-Fi, Bluetooth and Wireless Connectivity research service, which includes research, data, and Executive Foresights. Market Data spreadsheets are composed of deep data, market share analysis, and highly segmented, service-specific forecasts to provide detailed insight where opportunities lie.
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