IoT or Internet on Thing is a smart device integrated with software or electronics which contributes to data exchange and gathering. It is also known as radio chips and uses the embedded processor, hardware, and sensor for data processing, receiving, or acting. The IoT chipsets are built to work with the application’s unique intent. These chips are relevant in wearable electronics, tablets, computers, automobile and transportation, medical devices to provide higher efficiency, and thereby boost results. For instance, IoT chips in smartphones enable phones to communicate with all other sensors and devices via any emerging technologies.
The IoT Chip market size was valued at USD 10.5 billion in 2019 and projected to reach USD 28.7 billion by 2027, growing at a CAGR of 13.4% during the forecast period, 2020-2027, due to the tremendous growth for the consumer products and related products. In addition, investment extension has been made by the IoT sectors to develop innovative IoT-based goods, which includes wearable & healthcare devices, consumer appliances, and others. Such trends lead to significant development across the globe of the IoT chips industry. Applications which provides more Static IP addresses, and advanced technologies such as AI fueling IoT adoption owing to the expansion of application-specific MCUs & flexible SoC-type designs, and the adoption of IPv6, are also anticipated to fuel the global IoT chip market.
However, concerns regarding the breaching of the data and security issues are estimated to create an obstacle in the growth of the global IoT chip market over the forecasted period. Moreover, the pricing of IOT Chip technology, which is high, is also creating an obstacle to the development of the IoT Chip market.
The increasing requirements for the application specific SoC and MCUs type design and the rise in the number of networking protocols are the key factors, which is projected to fuel the IoT chip market across the globe. IoT chips facilitate connectivity functionality in a range of devices, including Near-Field Communications (NFC), Bluetooth, and Global Navigation Satellite System (GNSS), which are expected to be used in smartphones and other electronic goods to strengthen a wide range of communication protocols. But modern microcontrollers can execute a broad variety of communication tasks.
The rise in data breaching is projected to hinder the market. Data protection and reliability are the main issues connected with the usage of loT chips, which is estimated to create an obstacle in the development of the loT chip industry. In addition, the lack of common communication protocols and the high-power consumption from connected devices across application platforms are challenges for the global IoT chips market.
Recently, the outbreak of COVID-19 has vigorously affected the IoT chip market of developed and developing countries globally. This health crisis has had an unparalleled impact on companies across various sectors. IoT spending and installations are declining dramatically. However, major distributors in the global market are addressing the current crisis and mitigate future challenges needs to respond rapidly. In addition, so many vendors are also taking the opportunity of this global pandemic by developing several new technologies.
Based on the hardware, the IoT Chip market segregated into Processor, Connectivity IC, Sensor, Memory Device, and Logic Device. The connectivity IC segment is estimated to occupy the largest share, whereas the logic device segment anticipated to witness the highest growth over the analysis timeframe due to the various advantages of FPGA, which includes the ability to reprogram in the field for debugging, rapid prototyping. Field Programmable Gate Array is extensively used across the electronic circuits. FPGA is more energy-effective and allows a limited board area compared to the analogous isolated circuit.
Moreover, the memory device segment is projected to have a significant growth rate over the forecasted period of 2020-2027 due to the large amount of the data which is generated by the IoT devices.
Based on the power consumption, the IoT Chip market classified into less than 1 W, 1-3 W, 3-5 W, 5-10 W, and more than 10 W. The more than 10 W segment is expected to dominate the power consumption segment as it consumes less energy as compared to the other, which consumes more energy. Additionally, 5-10 W anticipated the fastest growth rate in the power consumption segment of the IoT chip market across the globe due to the extensive use of surveillance cameras.
Based on the end-use application, the IoT Chip market segmented into Wearable Device, Healthcare, Consumer Electronics, Building Automation, Industrial, Automotive & Transportation, Banking Financial Services, and Insurance (BFSI), Agriculture, Retail, Oil & Gas, and Others. The aerospace and defense segment is anticipated to have the fastest growth rate over the forecast period of 2020-2027 as IoT provides airlines a range of ways to enhance luggage handling and control machinery & equipment.
Moreover, the retail segment is projected to have a considerable growth rate due to the advantages of IoT in the retail industry. It offers enhanced customer experience coupled with the rising revenue. Additionally, IoT-enabled devices are mainly used for inventory and mobile payment management.
By geography, the IoT Chip market segmented into North America, Europe, Asia Pacific, South America, and Middle East & Africa. North America estimated to project considerable growth over 2020-2027. It is owing to advents in technology and rising R&D activities in the IoT industries across the region. In addition, the widespread growth of IoT applications in various industries, such as retail, building automation, healthcare, etc. is estimated to have the major driver of market growth across the region. Furthermore, the growing demand for a better lifestyle is one of the main factors expected to propel the development of the IoT chip in North America.
However, Asia Pacific is projected to have the fastest growth rate across the globe. India’s vision of make in India for transforming the 100 cities into smart cities is estimated to produce a huge demand for IoT devices in the automotive sector and the smart homes market.
Companies such as Intel Corporation, Texas Instruments Incorporated, Silicon Laboratories, Qualcomm Incorporated, NXP Semiconductors N.V., Nordic Semiconductor ASA, MediaTek Inc., Marvell Technology Group Ltd., Semtech Corporation, Microchip Technology Inc., Cypress Semiconductor Corporation, Renesas Electronics Corporation, STMicroelectronics NV, Huawei Technologies Co., Ltd., Telit Communications PLC, NVIDIA Corporation, ARM Holdings, Samsung Electronics, Advanced Micro Devices, and WhizNets Inc. are the key players in the IoT Chip market.
By Power Consumption
By End-use Application
IoT chips, also known as radio chips, are electronic devices embedded in machines, wearable electronics, tablets, computers, automobiles and transportation, and medical devices to improve efficiency and boost results.
IoT chips that include sensors, processors, on-chip and off-chip memory types, I/O, and interface IP and chipsets are used in SoCs, custom ASICs in the cloud, 2.5D chips for networks and servers, Wafer-level packaging for MEMS and sensor clusters.
The IoT Chip market size is valued at USD 11.91 billion in 2020 and is projected to reach USD 28.7 billion by 2027.
Globally, the IoT chip market is growing at a CAGR of 13.4% during the forecast period, 2021-2027.
North America is one of the most significant contributors in the IoT space attributed to the factor that it is technologically developed. Canada and the United States are the major countries in the IoT market of this region. These countries have established economies, which empower them to invest in R&D activities strongly.