Connected-consumer-device-count rises, but no IoT-style explosion in view

February 14, 2014 // By Graham Prophet
6 billion Internet-enabled devices will be produced in 2014, according to analysis by market researchers IHS: their predictions for the next few years show continued modest growth, confirming that any spectacular spikes in connected-device numbers will come from IoT, or machine-to-machine, connections. The forecasts also confirm consumers’ preferences to use multi-function devices – overwhelmingly, this means the smartphone handset – for functions that were previously the province of discrete products.

In this global market analysis, IH Technology looked at connected devices that allow users to access the Internet, such as cellphones, tablets and computers. Worldwide production of such connected equipment, the company estimates, will amount to 6.18 billion units this year, up 6% from 5.82 billion in 2013. This will be the largest increase for the market in four years, surpassed only by the 10% hike in production during 2010, a year after the global economic recession ended.

Production growth rates will then slow in the next few years, even though total units produced will continue to rise in absolute numbers. Between 2015 and 2017, an estimated 19.42 billion new devices will flood the planet, as shown in the chart above.

“The improved growth this year of the connected devices industry marks the return of higher production as manufacturers deliver all sorts of connectivity equipment to users,” said Jagdish Rebello, Ph.D., senior director for information technology at IHS. He classifies connected devices as equipment that allows users to interact with the Internet in some fashion, from as passive an activity as simply looking at photos in social media or streaming media content for consumption, to a livelier form of engagement, such as gaming in real time. The devices must possess embedded connectivity to figure in these tables.

Among connected devices, those expected to see higher production numbers this year include video game consoles, media tablets, mobile handsets, LCD TVs, set-top boxes and mobile PCs.

In contrast, equipment markets that will suffer reduced production this year are digital still cameras, camcorders, desktop PCs, DVD players/records and portable media players.

The biggest growth in production took place in the earlier years of the connected devices era in the first seven years after the new millennium, when production spiked by as much as 27% annually and yearly growth rates frequently hovered in the 20% range, Rebello noted.

Game consoles are forecast to enjoy