Gartner: Business Spending Will Represent More Than Half Of Overall IoT Spending In 2017

Solution providers interested in the internet of things are pleased by a new report that says businesses will dominate IoT spending in 2017.

A new report by Gartner, released Tuesday, says that businesses will represent 57 percent of overall IoT spending in 2017 – up from $847 billion in 2016 to $964 billion in 2017.

"IoT services are central to the rise in IoT devices," said Denise Rueb, research director at Gartner, in a statement. "Services are dominated by the professional IoT-operational technology category in which providers assist businesses in designing, implementing and operating IoT systems."

[Related: 10 IoT Predictions For 2017]

The total spending on IoT services – including professional, consumer and connectivity services – is expected to reach $273 billion in 2017.

Robby Hill, CEO of HillSouth, a solution provider based in Florence, S.C., said that he is noticing a trend in the higher education market where customers' campuses have about four devices per person on average "and clearly that usage is from IoT."

"There is clearly opportunity with embracing a trend such as this and not sticking your head in the sand waiting for your client's networks to collapse or slowdown from the added traffic as a VAR," he said. "We also have been working on bandwidth upgrades as well as refreshing the switching gear to gigabit and replacing the firewalls more often due to the demand that these IoT devices place on the corporate networks."

According to Gartner, applications tailored to specific vertical markets – such as manufacturing field devices, process sensors for electrical generating plants and real-time location tools for healthcare – will drive the use of connected things for business in 2017.

Beyond education, Hill stressed that vertical markets like healthcare are gaining traction in their adoption of IoT solutions: "In healthcare with our client base we have seen IoT rapidly adopted by the larger clinical environments, and there remains much capacity within smaller clinics to embrace it, and the smaller organizations are planning for it but still sitting on the fence in our healthcare practice as compared to larger healthcare entities."

For Douglas Grosfield, the founder and CEO of Five Nines IT Solutions, a Kitchener, Ontario-based strategic service provider, the increase in devices also comes with significant cybersecurity concerns, as well as opportunities for solution providers.

"Considering the proliferation began only a few short years ago, in earnest, these are staggering numbers, and represent massive opportunity," he said. "However, that opportunity is not all good, as the huge expansion of connecting devices in use today create a linear increase in the threat landscape across a multitude of vectors from a cybersecurity perspective."

"From the perspective of this strategic service provider, this also signifies opportunity in that there are billions more reasons now to have frank discussions with clients and prospects about how to implement, and support, the appropriate technologies to provide the protections necessary in this incredibly connected world," Grosfield added. "Opening the door to meaningful and critical dialogue about organizations' cybersecurity strategies is key to putting best practices in place for today."

Overall, Gartner forecast 8.4 connected "things" will be in use globally in 2017 – up 31 percent from 2016.

While businesses will play a bigger role for the IoT market this year in terms of spending, the consumer segment will still be the largest user of connected devices, with 5.2 billion units forecast to be in use for 2017, according to Gartner.