We hear a lot these days about the Internet of Things, everyday appliances connected to the Internet.
But there’s another side to the IoT — using smart devices in the business environment — and rarely do we get a solid look at how big a business it is and how fast it’s growing.
That changed today with the release from Verizon of a fairly comprehensive report that outlines the size of the business and the scope of its growth. For starters, Verizon (with help from ABI Research) estimates that as of 2014 there were 1.2 billion different devices connected to the Internet, and that the number will rise to 5.4 billion by 2020 for an annual growth rate of 28 percent.
On its most recent earnings conference call, Verizon said IoT business brought in $585 million in revenue in 2014 — a tiny drop in a very big wireless bucket worth almost $88 billion, though it grew at a respectable 45 percent year on year.
In an interview with Re/code, Mark Bartolomeo, a Verizon VP who runs its IoT business, said the carrier had about 15 million devices running wireless machine-to-machine connections last year. Compare that with the 108 million human subscribers using phones and tablets.
“We’ve seen the early adoptions, but now we’re getting to a new phase where we’re seeing fast followers in this business,” he said. They run the gamut from automotive companies working on connected cars to electrical utilities deploying smart meters, or manufacturers.
In fact, it was the manufacturing sector that saw the fastest growth in adopting IoT products last year, up more than triple since 2013, according to the report. Companies started small, using connected cameras and sensors to monitor security in factories and keeping a close eye on the flow of production and shipments. Now companies that make and service large-scale factory equipment are adding IoT smarts to watch for signs of costly breakdowns and to help save on the cost of regular in-person inspections.
Other segments deploying IoT devices at a fast-growing rate included finance and insurance companies (up 128 percent year on year), media and entertainment firms (up 120 percent) and the home security and monitoring businesses (up 89 percent).
And the opportunity for growth is sizable, Bartolomeo says, in part because relatively few firms across all industries — only about 10 percent worldwide — have yet adopted any IoT technology. Many are deploying early-stage pilot programs or waiting to see results from other companies.
This article originally appeared on Recode.net.