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China's manufacturing IoT spending to hit $128b by 2020: IDC

(Xinhua) Updated: 2016-09-01 16:54

BEIJING - Chinese manufacturing enterprises' spending on the Internet of Things (IoT) is expected to grow by an annual average rate of 14.7 percent and hit $127.5 billion by 2020, a report showed Thursday.

"During the process, software and services will lead the way for fast growth with a combined market share of over 60 percent," according to the report by research firm International Data Corp (IDC).

IoT is a strategic emerging industry in China, and was included in the 13th Five-year Development Plan. "Made in China 2025" is a 10-year action plan that aims to build China into a manufacturing powerhouse.

Promoting smart manufacturing -- raising the level of networked, collaborative manufacturing and expediting the manufacturing industry's transformation into services -- is the way forward for the industry, said the IDC report.

"Many Chinese manufacturers have started to implement an IoT strategy to improve production, efficiency and evolve their business models," said Wang Yue, senior research manager at IDC China.

With the promotion of smart manufacturing, the fast integration of information technology and operational technology (OT), and the prevalence of the "digital twin" concept, there is plenty of room for development in the manufacturing industry, according to Wang.

In the next two years, three major trends will lead IoT development in China's manufacturing industry -- IoT platform competition will intensify, manufacturing IoT applications will accelerate innovation, while edge computing will become the next area to be expanded, IDC forecast.

IoT will see tangible objects connected to the internet, allowing them to interact with other devices.

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