IoT Gateways Market Research Report- Forecast 2027

IoT Gateways Market Information: by Type (Lightly Rugged), Component (MCU, FPGA), Connectivity (Wi-Fi, Bluetooth), Application (Wearable Devices, Healthcare), Node (Smartwatch, Actuator), and Region – Global Forecast Till 2027

ID: MRFR/ICT/2170-CR | October 2018 | Region: Global | 135 pages

IoT Gateways Market Overview:


 


IoT Gateways market is expected to grow with a CAGR of 16.9% by 2023 globally. An IoT gateway is a crucial edge appliance that can be called a communication aiding machine. The IoT device is capable of interacting with the physical world like sensors and remote servers with the help of IoT Gateways. Hence IoT gateway offers services to various fields including health, industrial operations, automotive, home automation, defense, space, and so on.


 


A typical gateway can be a software program or a hardware device that helps in establishing a connection between devices or between devices and the Internet of Things. The sensors being installed in every industrial sector require a connection pathway to the server that processes the data.


Recent advancements in the industry have brought in the functionalities that ease up the overall industrial operations. The IoT gateway can perform effective protocol translation, data processing at the local node, filtration of data before sending to the external node.


 


COVID 19 Analysis:


 


The Pandemic has brought severe economic shock to various industrial sectors. Several crucial sectors have utilized the business continuity schemes to carry out the essential operations. The automotive systems require connection to the cloud to potentially increase their production operations. Owing to the increasing demand for the automotive industry, major market players of the automotive industry have utilized the IoT gateways in their production sector during the lockdown. This has impacted their revenue in the year 2021 positively. The value has increased from USD 18.03 million to 21.08 million in the year 2021. Hence the IoT gateways market growth has been influenced by the other industrial sectors.


 


Several governmental organization in the endeavor of preventing the spread of COVID 19, has intensively utilized the IoT connected platforms to detect the patients in public areas. The ability of the IoT gateways to preprocess the data and quickly respond to the external resources has increased the IoT gateways market value during the COVID period. Additionally, the IoT Gateways market contributed excellent service to the healthcare industry during the lockdown. The medical practitioners and doctors can monitor the patient's health through the IoT ecosystems from remote places. 


 


Market dynamics:


 


Market drivers:


 


The rising number of connected devices throughout the industrial sectors has been the huge driving factor for the IoT gateways market demand. As the industrial sectors are generating a huge quantity of data, the demand for cyber protection and advanced security protocols have increased in recent years. These factors have significantly increased the IoT Gateways market demand in the industrial sectors. As the IoT Gateways are capable of providing multi-level authentication and end-to-end encryption to the data to protect the data from security breaches


 


In recent years, intelligent sensors are playing a vital role in every industrial and commercial sector, even in residential sectors. Even small and medium organizations are adopting IoT-enabled sensors with cloud technology to manage essential operations. Sensing heat, humidity, air conditioning, refrigeration in the industries, commercial shops, residential units are crucial in the developed countries. This factor is currently a major driver of the IoT Gateways market.


 


Market opportunities:


 


Continuous development in the industry offers attractive functionalities to the end-users. Especially, the custom-designed IoT devices which can monitor the air quality are crucial in the health care industry. The air quality sensors operated with the IoT environment have significantly improved the health condition of the patients in hospitals. The IoT devices that can connect with data visualization tools help ineffective management and provide insight into compliance.


 


To retain the position in the market the vendors are increasingly working in promoting the features and continuously provide to support tools. Especially the advent of modular IoT Gateways is capable of supporting wireless protocols like Wifi, thread, and Zigbee. The extensive usage of IoT devices in the airlines' segment in segregating baggage and handling the missing baggage cases has also increased the IoT Gateways market value in the airlines' sector.


 


Market restraints:


 


The growing demand for extensive data protection protocols because of cyber-attacks and security breaches in various enterprises has been a huge restraining factor for the IoT Gateways Market growth.


 


The usage of wireless devices like laptops, smartphones, and tablets has led to the exposure of critical data. The cyber-attack concerns have reduced the demand for wireless IoT Gateways in industrial sectors.


 


Market challenges:


 


Currently, the standardization of communication protocols of the IoT technology is at the developing stage. However it's expected to be matured with growing researches in the industry, these factors impose a significant challenge for the growth of the IoT Gateways market. The industry lacks communication standards and protocols.


 


Higher power consumption and network latency are ever existing challenges, since the internet users lose interest in the network latency issues, the IoT Gateways market is experiencing a decline with these factors. The IoT Gateways that connect the sensors require higher network bandwidth and faces significant connectivity challenges.


 


Cumulative growth analysis:


 


Currently, the memory segment is expected to reach over 16% CAGR by 2027 as the industrial sectors are increasingly using semiconductor memory for IoT Gateway devices.


As poor connectivity is imposing issues in the IoT ecosystem, industrial sectors are intensively utilizing Semiconductor memory storage to prevent data losses. Additionally, the vendors are increasingly working in the market to bring in advanced memory components in the gateway devices. Combating the data retention the IoT Gateways market value is expected to grow in the forecast period.


 


The dropping production costs and energy efficiency features have attributed to the overall growth of the IoT Gateways market. The European Commission has recently stated about their increasing investment in building smart cities in the nation. The country is aiming to build over 300 smart cities shortly. Such increasing investments towards smart cities influence the IoT Gateways market growth.


Value chain analysis:


The IoT Gateways are capable of communicating with the external sensor networks; additionally, they are capable of performing the preprocessing, filtering data at the edge. The effective management of data has made the industries deploy IoT Gateways in their premises. Recently the advancements have made the IoT Gateways handle inbound and outbound traffic with the cloud. They act as routing devices and perform preprocessing at the edge before sending them to the cloud. This functionality significantly reduces transmission costs and response time.


Several sectors are deploying IoT Gateways as they are capable of performing operations at minimal power consumption and establishes effective communication with the cloud which is ineffective otherwise. The IoT Gateways perform effectively when integrated with edge computing, big data analysis. The increasing adaptation of IoT devices and edge computing is significantly influencing the IoT Gateways market share, globally. Since the digital twin project is currently maturing, the IoT Gateways market is expected to witness prominent growth in the forecast period.


Segment overview:


Based on type:



  • Lightly rugged

  • rugged

  • compact

  • ultra-compact


Based on the component:



  • field-programmable gate array (FPGA),

  • microcontroller units (MCU)

  • sensor

  • memory card

  • others


Based on connectivity:



  • Bluetooth

  • Wi-Fi

  • ZigBee

  • Ethernet

  • Cellular

  • others


Based on applications:



  • consumer electronics

  • building automation

  • automotive and transportation

  • wearable devices


Based on sectors:



  • healthcare

  • industrial

  • oil & gas

  • aerospace

  • defense

  • education

  • agriculture

  • BFSI

  • Government


Based on node:



  • Smartwatch

  • smart TV

  • actuator

  • camera

  • RADAR

  • thermostat

  • others


Regional analysis:


Among several other countries, North America is comprised of advanced IT companies hence the country is expected to reach a market value of over USD 5522.5 Million by the year 2025. Also, currently, the country is holding the highest market share. Other than North America, Asia-pacific, and Europe are experiencing higher opportunities for the IoT Gateways market growth. Several developing countries like India and Europe are highly focusing on smart cities and related technologies. These impart significant scope for the IoT Gateways market growth.


Competitive landscape:



  • Hewlett Packard Enterprise Company (U.S.),

  • Cisco Systems, Inc. (U.S.),

  • Huawei Technologies Co. Ltd. (China),

  • Advantech B+B Smartworx (U.S.),

  • Bitrective AS (Norway),

  • Advantech Corporation (Taiwan),

  • Eurotech (Italy),

  • Sierra Wireless (Canada),

  • Volansys Technologies Pvt. Ltd. (U.S.)


Recent developments:


As several big shots in industrial sectors generate a huge quantity of data, excessive data load has been a challenge for the growth of the IoT Gateways market. However, developments have been incorporated in recent times to combat the issue. Techniques like load balancing techniques, cluster managers are integrated with the infrastructure to mitigate the issue. A potential cluster manager defines a threshold for every gateway and transfers the excessive data to the nearby gateway when the data exceeds the threshold. This process reduces the processing time.


The integration of pumps, conveyors, and cyber-immune technology has made the gateway to protect the systems from cyber-attacks. The development of intelligent IoT Gateway protects the system from several security breaches and protects the data and system effectively.


Report overview:


This report has covered:



  • Market overview

  • COVID 19 Analysis

  • Market dynamics

  • Cumulative growth analysis

  • Value chain analysis

  • Segment overview

  • Regional analysis

  • Competitive landscape

  • Recent developments


Segmentation Table:


Based on type:



  • Lightly rugged

  • rugged

  • compact

  • ultra-compact


Based on the component:



  • field-programmable gate array (FPGA),

  • microcontroller units (MCU)

  • sensor

  • memory card

  • others


Based on connectivity:



  • Bluetooth

  • Wi-Fi

  • ZigBee

  • Ethernet

  • Cellular

  • others


Based on applications:



  • consumer electronics

  • building automation

  • automotive and transportation

  • wearable devices


Based on sectors:



  • healthcare

  • industrial

  • oil & gas

  • aerospace

  • defense

  • education

  • agriculture

  • BFSI

  • Government


Based on node:



  • Smartwatch

  • smart TV

  • actuator

  • camera

  • RADAR

  • thermostat

  • others



Frequently Asked Questions (FAQ) :


Between 2018 and 2023, the global market of IoT gateways can thrive at 16.9% CAGR.

Hewlett Packard Enterprises Company (U.S.), Mitsubishi Electric Corporation (Japan), and NEC Corporation (Japan) are some notable players of IoT gateways market.

Bluetooth, Ethernet, c Wi-Fi, ZigBee, and cellular connectivity are deployed in IoT gateways.

The growing inclination towards wireless technologies can drive the global IoT gateways market expansion.

North America boasting of its technical infrastructure can cause the regional IoT gateways market gain high revenue in study period.

Top-notch companies of the market and their dynamics, growth scope, and potential threats are major discussions mentioned in the report.

Key players adopting strategies that can serve them long-term goals can make significant contribution to the IoT gateways market expansion.

Global IoT Gateways Market – Summary


The global IoT gateways market can anticipate an exponential growth with 16.9% CAGR and reach a market valuation of USD 15.59 billion during the forecast period (2018-2023). Fast transforming industrial scenario requires faster connectivity. This gives rise to a demand for an interface that would connect all devices in a network and enable better communication. Hence, the need for Internet of things (IoT) which helps users with access to control of multiple functions such as scalability, fault tolerance, and power consumption of nodes & transceivers for smooth data flow. With IoT’s turning intelligent by getting embedded controls, it has started reducing the complexity and cost of endpoints, which has cemented its place in healthcare and other industry verticals.


Connected devices have infiltrated sectors such as business organizations and lifestyle profoundly. Its impact is so high that the ecosystem around these sectors is now thriving at an unprecedented rate. Integration of IoT gateways in smart buildings is increasing significantly and sectors such as automotive, healthcare and utilities can expect better leverage.


Wireless technology is gaining singular momentum across industrial verticals. Facilitating seamless integration of networks is IoT’s forte. Governments have realized its potential, and now IoT is getting much-valued attention which further simplifies its percolation into diverse sectors. Moreover, emerging economies are playing a crucial role in lending the IoT gateways market a supportive hand.


Efficient working of IoT gateways requires integration of heterogeneous networks such as Zigbee Ad-hoc network, wireless LAN, cable network, and others. Its applications in environmental monitoring, intelligent transportation, medical care, smart home, industry control, safety, defense for high data-rate, end-to-end connectivity, and higher bandwidth of multi-hop networks need high implementational cost which can cripple the expected growth rate for the considerable period.


Segmentation Analysis:


By type, the IoT gateways segment can be segmented into lightly rugged, rugged, compact, and ultra-compact. Compact segment has the largest market share with a current worth of USD 2,281.4 million, and during the forecast period, it could go up to USD 6,035.3 million with the highest CAGR of 18.1%. Rugged follows next, both in terms of market value and CAGR where it can reach USD 5,004.7 million with 17.1% growth rate.


Component-wise, the IoT gateways market can be segmented into microcontroller unit (MCU), Field Programmable Gate Array (FPGA), sensor, memory cards, and others. Sensor market would dominate forthcoming years with a CAGR of 18.2% and reach a valuation of USD 5,232.5 million from the previous estimation of USD 1,971 million. FPGA, with a projected 17% CAGR could reach a market valuation of USD 4,326.6 million and retain its second spot.


Based on connectivity, the IoT gateways market can be segmented into Bluetooth, wi-fi, ZigBee, ethernet, cellular, and others. Bluetooth will take over the current lead of wi-fi by a considerable margin. Its expected CAGR of 18.4% would take it from USD 1,458.2 million to USD 3,922.9 million. However, highest CAGR during the forecast period will be of ZigBee where it can fetch a CAGR of 18.7%.


Application-wise, the IoT gateways market can be segmented into wearable devices, healthcare, automotive & transportation, building automation, industrial, consumer electronics and others. Automotive & transportation would take over the lead from industrial with an expected market valuation of USD 3,474.1 million. However, wearable devices would lead the market with the maximum CAGR of 19.9% during the review period. Automotive & transportation can have the second best CAGR of 19.1% during the forecast period.


By node, the IoT gateways market includes smartwatch, camera, radio detection & ranging (RADAR), thermostat, actuator, smart TV, and others.


Regional Analysis:


Geographically, the IoT gateways market spans across regions namely North America, Europe, Asia Pacific (APAC), and Rest-of-the-World (RoW).


North America, currently leads the market with an estimated value of USD 2,397.8 million and the scenario is expected to remain so with the regions anticipated climb to a valuation of USD 5,522.5 million. Its state-of-the-art infrastructure can take the credit of its superior positioning. Various industries are implementing the technology and investing substantially in hope to gain much. At the same time, people in the region, are prone to adapt a superior lifestyle which gives the region further boost and the CAGR during the review period could go up to 15.4%.


Europe’s status in the market based on features is almost similar to that of North America and with a CAGR of 16.8%, the regional market could escalate to USD 3,882.1 million valuation. However, the APAC is anticipated to register the maximum CAGR of 19%, considerably higher than its peers. This can be attributed to a burgeoning industrial sector that is witnessing exclusive growth and could help compete with North America neck-to-neck. By 2023, the APAC could climb up to USD 5,471.7 million valuation.


Competitive Market Analysis:


The intensely competitive market banks on strategic implementations such as merger, collaboration, acquisition, new product launch, and others. These tactics have kept players engaged. Hewlett Packard Enterprises Company’s collaboration with ABB Ltd. and Tata Communications can give the company further market penetration. On the other hand, Bosch Rexroth, a subsidiary of Robert Bosch acquired Hytec Holdings (Pty.)  Ltd, to extend their business to Africa.


Prominent players in the IoT gateways market include Eurotech SPA (Italy), NEC Corporation (Japan), Mitsubishi Electric Corporation (Japan), Siemens AG (Germany), Sierra Wireless, Inc. (Canada), Cisco Systems, Inc., (U.S.), Lantronix Inc. (U.S.), Robert Bosch GmbH (Germany), Huawei Technologies Co. Ltd. (China), Hewlett Packard Enterprises Company (U.S.), Dell Technologies (U.S.), Fujitsu Ltd. (Japan), Toshiba Corporation (Japan), and others.

Growing market of connected devices and increasing use of wireless sensors is driving the burglar alarm market creating a highly competitive landscape


Technological advancements in the IoT gateways have encouraged many small players to enter in the market. These small players possess a major threat to large players prevailing in the IoT gateway market. Hence, the large players are focusing on acquisitions and partnerships to maintain their market positions. Also, the companies compete on the basis of characteristics such as cost of the product, features, and compatibility of these products in the long run.


The growth of IoT gateway market is fueled by the increasing use of connected devices and wireless networks by organizations. Nonetheless, the growth of manufacturers depends upon market conditions, government support, and industry development. Thus, the manufacturers should focus on improving efficiency and compatibility of their product to expand their market reach. Cisco Systems, Inc., Huawei Technologies Co. Ltd, Dell Technologies, Hewlett Packard Enterprise Company, and Siemens AG are the major companies in the market, which compete in terms of customization, quality, price, and technology. They primarily focus on the compatibility of IoT gateways for faster and secure transmission of data. It has also been forecasted that improvement of the global economic scenario combined with technological advancement in the emerging economies is fueling the market growth, thereby making it an ideal time for active players to launch advance IoT gateway devices and increase the global market share.


Cisco Systems, Inc. is dominating the IoT gateway market with a major focus on strategic partnerships with large as well as small businesses to expand their market reach in developing geographies. The strong research and development capabilities have led Cisco Systems, Inc. to design and implement LoRaWAN gateways and gain a competitive advantage in the IoT gateway market.


On the other hand, Huawei Technologies Co. Ltd, Dell Technologies, Hewlett Packard Enterprise Company, and Siemens AG are constantly trying to compete with each other as well as Cisco Systems, Inc. to procure most of the market with their IoT gateway devices. Huawei Technologies Co. Ltd focuses on providing rugged and versatile IoT gateway devices for various industrial applications. These gateway devices integrate routing, switching, and computing functions for connecting across various verticals thereby, supporting local intelligence.


Dell Technologies engages in the provision of IoT gateway devices to facilitate secure transmission of data across edge devices and the cloud. To attain efficiency, Dell Technologies partnered with Microsoft to help customers deploy end-to-end IoT solutions from edge to the cloud. This partnership has benefited users to streamline management, monitoring and security solutions from gateway devices to the cloud.


The diversified market reach of Hewlett Packard Enterprise Company’s IoT gateway devices in industries including manufacturing, smart cities, oil and gas, among others has led the company to become one of the major players in the IoT gateway market. The major differential element in Hewlett Packard Enterprise Company’s IoT gateway devices is that it enables companies to process data in real-time before the data is stored for additional analysis. Thus, it provides Hewlett Packard Enterprise Company with a major competitive advantage in the IoT gateway market.


Siemens AG stands fifth in the IoT gateway market and is majorly focusing on partnerships and collaborations with large industries to innovate IoT devices that will leverage their customers with advanced and effective product portfolio. Siemens AG collaborated with Tata Consultancy Services to provide customers data insights and analytics from a cloud-based open IoT operating system, MindSphere. Using analytical services such as predictive maintenance and energy monitoring, the solution is expected to benefit customers across manufacturing, energy, building technology, healthcare and railway industries.


Although these players dominate the IoT gateway market, players including Fujitsu Ltd, Sierra Wireless, Inc., NEC Corporation, Toshiba Corporation, Mitsubishi Electric Corporation, Robert Bosch GmbH, Eurotech SPA, Lantronix Inc., and others also have a strong market presence. These players focus on collaborating with businesses with strong market presence to expand their market reach thereby, enhancing their product portfolio.


Apart from the above-mentioned players, ODM vendors also have a prominent presence in the IoT gateway market. With the rapid growth of the Internet of Things (IoT), ODM vendors are putting full efforts into the developments of new business, including the fields of wearable devices, smart homes, auto electronics, servers, industrial PCs and others. ODM vendors such as HonHai, Compal, Quanta, Wistron, Flextronics and others have a significant market share in the IoT gateway market.


Quanta Computer's white-box server subsidiary is planning to establish new branches in Hangzhou and Shenzhen, China. These new branches are expected to strengthen their partnerships with China-based Internet players Alibaba and Tencent, whereas Wistron has cooperated with industrial PC (IPC) player Arbor Technology to seek Internet of Things (IoT) business opportunities. Wistron Corporation has launched a USD 20 million venture capital fund with the US. Silicon Valley-based Fenox Venture Capital is expected to access and work with the top technology companies from around the world. This partnership with Fenox VC would provide an access for Wistron to the top technology startup companies through the global network of Fenox VC.


Compal showcases a prominent presence in the market, it has ventured into the development of home gateway platform and has also developed new products and business lines by cultivating wireless technology and sensor network technologies, integrating background cloud computing services and focusing on smart energy saving, smarter safety, and smart home care. In the future, Compal is also expected to rely on its core capabilities to gradually expand its product range and depth in different domains of IoT in order to locate corresponding niche markets to expand the product coverage.


In June 2017, Xped Limited signed a Memorandum of Understanding with Compal Electronics Inc. The companies are expected to collaboratively engage to develop a binding agreement to license several Xped technologies, and collaboratively market to Compal’s customer base.