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November 3, 2014

IoT components revenue will boom in 2015

Processors, controllers and sensor sales will increase by 36% next year.

By Amy-Jo Crowley

Revenue for processors, microcontrollers and sensors in the Internet of Things market is expected to grow by 36.2% in 2015, driven by increased demand for autonomous vehicles, LED lightning and low cost consumer devices.

A report by Gartner predicts that microcontrollers and embedded processers will generate $7.58bn alone in revenues next year for the IoT market, while optical and nonoptical sensors will see a 47.5% growth.

By contrast, the overall semiconductor market will grow by just 5.7%.

"The demand for billions of things will ripple throughout the entire value chain, from software and services to semiconductor devices," said Alfonso Velosa, research director at Gartner.

The report put the growth down to increased demand for processors and sensors in the automotive industry, while the use of LED lightning will lower costs and create new services.

"One example of how the IoT will transform an automobile is the use of predictive maintenance," the report said.

"Using small sensors throughout the engine, predictive maintenance allows for a better experience for the consumer while enabling tremendous cost savings for both the consumer and the automotive dealer," the report said.

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Consumers looking to enhance their lifestyles will also play a central role in growing IoT demand, which in turn will create more demand for semiconductors, according to Gartner.

Dean Freeman, research VP at Gartner, said: "This revenue spans every conceivable industry and is driven by the immense scale of low-cost devices.

"Some in the industry believe this growth will transform the semiconductor industry. However, further investigation shows that the majority of IoT devices are commodity offerings. The truth is that inexpensive devices are one of the biggest enablers of IoT."


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