In the rapidly evolving IoT semiconductor market, understanding which companies are setting the pace and how technological breakthroughs fuel this sector’s growth is critical. From smart homes to industrial automation, IoT semiconductors are becoming the bedrock of innovation. This article provides an in-depth look into the movers and shakers of the IoT semiconductor world, the innovations propelling them, and the overarching impact on our increasingly connected lives as we head into 2024.
Key Takeaways
- The IoT chip market is projected to reach USD 0.58 trillion by 2024 and could double by 2029, with significant growth in North America and the Asia Pacific region. Major players like Intel, Qualcomm, and NVIDIA are innovating and driving revenue through IoT-related products.
- IoT semiconductors are facilitating the development of smart cities, enhancing urban efficiency and enabling practical applications in governance, transportation, health care, and energy management.
- IoT chips are witnessing integration into consumer electronics and industrial applications, revolutionizing consumer devices, prompting smart home advancements, and contributing to the surge in Industrial IoT (IIoT) for automated and sustainable manufacturing.
Exploring the IoT Chip Market Landscape
With a compound annual growth rate of 14.70%, the IoT chip market is projected to reach USD 0.58 trillion by 2024 and is expected to double by 2029. This impressive iot chip market size growth isn’t concentrated in one region. While North America currently holds the lion’s share in the IoT chip market, it’s the Asia Pacific region that’s expected to grow at the highest rate in the coming years. Despite the challenges such as increased R&D costs and talent acquisition, IoT remains the beacon of growth for the semiconductor industry.
Major semiconductor companies are riding this wave of growth, with IoT revenue accounting for over 10% and, in some cases, surpassing 20% of their total revenue. The IoT chip industry goes beyond just numbers; it embodies the innovation and creativity that these small components introduce into our lives, ranging from wearable technology to the creation of smart homes and cities.
Market Size and Predictions
Despite the current global IoT chip market being estimated at USD 0.58 trillion, its growth hasn’t always been smooth. The market experienced a significant recovery of 6.7% growth quarter-over-quarter from Q1’23 to Q2’23 after a period of stagnation. However, the upward trajectory is clear. The IoT sector within consumer electronics alone is projected to reach $153.80 billion by 2026, reflecting the market’s larger upward trajectory.
The IoT chip market is expected to grow from USD 392.0 billion in 2020 to USD 525.4 billion by 2025. By 2029, the market is anticipated to reach approximately USD 1.16 trillion. The forecasted revenue compound annual growth rate (CAGR) for the IoT chip market stands at 14.9% from 2024 to 2029, supporting the expectations for substantial market growth within the industry.
The McKinsey Global Institute further bolsters these predictions, stating that by 2025, the broader IoT applications, in which the chip market is a key player, could generate a global economic value ranging from $4 trillion to $11 trillion.
Key Players and Innovations
Certain trailblazers distinctly stand out in the realm of IoT semiconductors. Intel Corporation, for instance, secures the first rank in the overall IoT chip market. Its IoT processor offerings include the 11th Gen Intel® CoreTM vPro®, Intel® Celeron® Processors, and Intel® Xeon® W-11000E processors, each pushing the boundaries of what’s possible in microchip technology.
Yet, Intel is not the only competitor in this race. Qualcomm excels in designing wireless telecommunications products and services for IoT, including automotive and machine learning applications. NVIDIA Corporation designs SoCs, impacting the automotive and mobile computing markets, including IoT developments.
Texas Instruments caters to IoT with Wi-Fi microcontrollers, Wi-Fi network processors, and Bluetooth transceivers designed for a range of applications from low-power to high-performance. Other major global players include Qualcomm Technologies Inc., Samsung Electronics Co. Ltd., Analog Devices Inc., STMicroelectronics NV, and NXP Semiconductors, each contributing to the new IoT solutions and the expansion of the global IoT chip market.
The Core of Smart Cities: IoT Semiconductor Role
When we envision the future, we often imagine smart cities – urban spaces where technology seamlessly integrates with infrastructure to create cleaner, safer, and more efficient living environments. IoT semiconductors are at the heart of this vision, enabling sustainable living and increased productivity for citizens by allowing different technologies to interact without human intervention.
These chips support initiatives for smart cities by facilitating applications across various domains such as governance, transportation, energy, and healthcare. Specific areas of improvement include smart traffic management systems, energy conservation through smart meters, and enhanced security via smart cameras.
From traffic lights that adapt to road conditions to intelligent utility meters that save energy, IoT semiconductors are paving the way for smarter, more connected cities.
Impact on Urban Efficiency
Efficiency forms the core of smart city development. IoT sensors and devices play a pivotal role in the optimization of urban infrastructure, particularly with smart traffic management and intelligent waste management systems. Through IoT technology, cities are able to deliver more responsive public services and improve upon sectors such as healthcare, waste management, and public safety.
Data collected by IoT devices is instrumental in enabling city officials to make informed decisions, thereby enhancing the efficiency of resource allocation and improving urban planning strategies. Emerging technologies like V2X communication technology and AIoT devices contribute significantly to urban efficiency by streamlining operations such as traffic control and waste collection, ultimately saving costs.
Nonetheless, challenges persist, including privacy and security concerns, the need for interoperability among various systems, and the necessity for a robust cybersecurity framework.
Case Studies
The impact of IoT semiconductors in smart city development isn’t just theoretical – it’s practical, tangible, and already making a difference across the globe. These chips are enabling advanced functionalities in smart city applications, leading to enhancements in key areas like:
- Smart agriculture
- Healthcare monitoring
- Environmental control
- Waste management
For instance, IoT enabled sensors can be used in various industries to improve efficiency and reduce costs. Some examples include:
- In agricultural fields, IoT sensors can monitor weather conditions and soil moisture levels, optimizing irrigation and reducing water wastage.
- In the healthcare sector, wearable devices can monitor vital signs and deliver real-time health updates, enhancing patient care.
- Smart waste management systems equipped with IoT sensors can optimize garbage collection routes, improving city cleanliness and reducing operational costs.
These are just a few examples of how IoT technology can be utilized to benefit different industries.
IoT Chips in Consumer Electronics
Moving away from the macro world of cities and industries and into the micro world of consumer electronics, IoT is creating significant changes. Leading global companies such as:
- Sony
- Apple
- Intel
- IBM
- LG
- Panasonic
- Samsung
- Toshiba
Manufacturers are integrating IoT features into consumer devices, enhancing the capabilities of mobile devices, such as smartphones, TVs, and refrigerators.
These IoT chips, identified as electronic devices that connect to wireless networks to send and receive data, are designed to be a single chip with an acceptable form factor and very low power consumption, which is particularly suitable for battery-operated devices. The integration of IoT-enabled features in consumer electronic devices provides benefits like enhanced entertainment, data management, and improved communication capabilities.
Smart Home Revolution
IoT semiconductors have transformed the once distant dream of smart homes into a reality. Smart devices within home automation systems enable remote monitoring and management of household tasks, allowing you to control your home’s lighting, temperature, and even security systems right from your smartphone.
Artificial Intelligence (AI) is incorporated in smart homes/devices, allowing for automatic adjustments of settings such as temperature and lighting according to user behaviors and preferences. IoT semiconductors play a key role in smart appliances by enabling the measurement and control of energy usage, and facilitating communication with homeowners and utility departments.
Wearables and Personal Devices
IoT technology is extending its reach beyond our homes and making a significant impact on our personal devices. Wearable devices, such as smartwatches, are increasingly offering seamless connectivity, reducing users’ reliance on smartphones by providing:
- Notifications
- Health and fitness tracking
- Music control
- Voice assistants
- GPS navigation
This direct functionality enhances the user experience and convenience.
Ultra-low-power MCU-based SoCs, like STM32WBA52 by STMicroelectronics and NCV-RSL15 by Onsemi, are pivotal in wearable technology for achieving very low power consumption. Consumers have developed a personal reliance on wearable devices, feeling incomplete without them and even choosing to sleep with them on.
Beyond watches and fitness trackers, smart clothing and accessories are experiencing innovation, incorporating features such as exact body measurements for clothing fit and built-in climate control.
The Industrial IoT (IIoT) Surge
One area experiencing a significant surge as we navigate the digital revolution is the Industrial Internet of Things (IIoT). The COVID-19 pandemic emphasized the need for automated and advanced industrial processes, boosting the global demand for IoT chips. IoT technologies such as sensors and integrated circuits are crucial in establishing connections between industrial equipment and larger networks.
With the incorporation of data analytics, semiconductor companies are improving power management and enabling more sustainable manufacturing practices. Digital twins act as virtual models for designing automation within smart factories and streamlining complex operations before they are physically executed. Interconnected IoT sensors within manufacturing facilities facilitate autonomous communication and coordination between machines, increasing productivity and safety.
Automation and Efficiency
In the industrial sector, automation is proving to be a game-changer. Some benefits of IoT applications in semiconductor manufacturing include:
- Streamlined production processes
- Increased manufacturing speeds
- Improved chip quality
- Automation that boosts overall operational efficiency
Automation in industrial settings enhances workplace safety by reducing the need for manual labor and ensuring compliance with safety standards. IoT-driven automated systems can be scaled efficiently to meet changing production demands, ensuring business agility and market competitiveness. Lastly, IoT technology aids in various aspects of manufacturing, such as quality control and inventory management, enhancing device testing, packaging, and distribution processes.
Logistics and Supply Chain
IoT technology is triggering a paradigm shift in the world of logistics and supply chains. Technology solutions, including IoT semiconductors, are utilized by 78% of supply chain leaders to enhance operational efficiency and increase production speed.
IoT-enabled sensors and communication devices are critical in facilitating predictive maintenance, which minimizes delivery delays by preventing unexpected transportation asset downtime. Manufacturers are implementing IoT technology to precisely manage inventory levels, ensuring the availability of necessary components to maintain constant production.
Powering Up: Energy Management and IoT Semiconductors
IoT semiconductors are assuming a crucial role as we grow more conscious of energy usage and environmental sustainability. IoT chip manufacturers are innovating new processes to create semiconductors that are smaller in size and consume less power to meet the needs of IoT devices.
Ultra-low power chips and modules are being developed by semiconductor manufacturers to tackle the challenges of power management in devices equipped with wireless technologies. New types of batteries such as solid-state and lithium-sulfur are under development, promising higher energy densities and improved safety for powering IoT devices.
The role of IoT chips extends to smart grid systems, where they facilitate efficient power management through real-time data sharing and better integration of renewables.
Innovations in Battery Technology
The innovations in battery technology are a testament to the rapid evolution of the IoT sector. Solid-state batteries, offering enhanced safety and high-voltage potential, are poised to disrupt the market with applications ranging from IoT devices to electric vehicles.
Lithium-sulfur batteries are emerging as a game-changing technology, promising energy densities up to four times greater than current lithium-ion batteries. These innovations in battery technologies not only break through previous energy limits but also offer a longer lifespan and improved power capabilities for IoT devices. These significant developments are integral to meet the low power consumption requirements of IoT devices.
Sustainable IoT Solutions
As we strive towards a more sustainable future, IoT chips are playing an increasingly vital role. IoT chips facilitate the management of environmental resources such as energy and water, leading to improved sustainability, including better air quality.
Through predictive maintenance, IoT chips can decrease the occurrence of machinery breakdowns by up to 70% and cut maintenance costs by 25%. IoT monitoring in smart devices allows manufacturers to achieve approximately 40% reduction in energy usage by optimizing machinery performance.
The semiconductor industry is incorporating circular design principles to promote the reuse of products and minimize electronic waste, paving the way for more sustainable IoT solutions.
Connectivity Unleashed: Wireless Systems and IoT Chipsets
Advancements in wireless systems and IoT chipsets are elevating the fundamental aspect of wireless connectivity in IoT to the next level. 5G networks are rapidly expanding worldwide, offering increased speed and efficiency for connected devices, with research into 6G promising even more advancements.
Wi-Fi 6 and Wi-Fi 6E represent the latest in wireless networking standards, providing enhanced speeds, greater device capacity, and lower latency for IoT ecosystems. Low Power Wide Area Network (LPWAN), Narrowband IoT (NB-IoT), and Long Range (LoRa) are new connectivity solutions that offer long-range communication, low power usage, and cost-effective networking for IoT devices.
IoT gateways such as Raspberry Pis and Arduino-based systems provide various connectivity options including WiFi, ethernet, and Bluetooth.
Evolution of Wireless Communication
The evolution of wireless communication technologies is playing a significant role in optimizing IoT connectivity. 5G technology integration is projected to significantly escalate the proliferation of the IoT chip market by enabling faster and more reliable connections for IoT devices.
New technologies such as millimeter wave, Ultra-Wideband (UWB), and Cognitive Radio are set to further optimize IoT connectivity. For instance, millimeter wave technologies are becoming increasingly vital for realizing 5G’s potentials, such as high-speed data transfer and minimal latency. Meanwhile, UWB technology is being progressively adopted for its high precision in location tracking combined with high data throughput and reduced power usage.
Challenges and Opportunities
While the evolution of wireless communication presents exciting opportunities for IoT, there are also challenges that need to be addressed. However, these challenges also present opportunities for innovation. Bluetooth 5.2 and LE Audio are set to enhance wireless audio devices by providing improved audio streaming and better support for hearing aids.
Zigbee and Thread protocols are increasingly important for secure, reliable, and scalable IoT networks, particularly in home automation and industrial applications. Satellite communication networks like Starlink and Project Kuiper aim to offer high-speed internet access globally, which will help in connecting IoT devices even in remote and underserved regions.
The Intersection of AI and IoT: Smart Chips for Intelligent Devices
The birth of a new technological realm known as AIoT, brought about by the convergence of artificial intelligence (AI) and the Internet of Things (IoT), promises the creation of smarter, more autonomous devices capable of making real-time decisions and actions.
Edge computing “edge devices” are increasingly becoming equipped with AI chipsets that enable real-time data analytics while maintaining privacy, signaling a significant shift in how data is processed and intelligence is distributed.
Companies traditionally known for high-performance computing, such as NVIDIA, are making strides in the industrial AI platform space, reflecting a broader industry movement towards embedding AI capabilities within semiconductor products.
AI-Enhanced IoT Hardware
As AI continues to evolve, it is becoming embedded into IoT devices, enabling smarter operational decisions through functions like local data processing. Nvidia GPUs such as Jetson AGX Orin and Jetson Orin Nano are being used in industrial AI platforms, featuring high performance with 2048 CUDA cores and 64 tensor cores towards IoT applications.
Chiplet-based architectures allow rapid prototyping and cost-efficient production for IoT devices, aiding in quicker adoption and innovation of AI-enhanced functionalities. The integration of AI into IoT semiconductors will drive unknown demands for higher performance, compelling companies to innovate and cater to these advanced requirements.
Edge Computing Advancements
Edge computing is emerging as a game-changer in the IoT landscape. By allowing data processing to occur closer to where it is needed, edge computing is increasing the performance of IoT devices.
By utilizing edge computing, IoT applications benefit from reduced latency, enhancing their ability to operate in real-time. Furthermore, the performance of IoT devices is improved thanks to edge computing’s facilitation of local data processing, thus expediting decision-making and action-taking processes.
Summary
As we journey through the world of IoT semiconductors, it’s clear that these tiny components are driving a technological revolution. From shaping the landscape of smart cities and consumer electronics to powering the surge in Industrial IoT and managing energy more efficiently, IoT semiconductors are at the heart of our digital transformation. As AI and IoT converge, we are witnessing the emergence of smarter, more autonomous devices capable of real-time decision-making. Despite challenges in wireless communication, advancements in technology continue to optimize IoT connectivity, promising an exciting future ahead.
Frequently Asked Questions
Who makes chips for IoT?
The major companies making chips for IoT include Qualcomm Technologies Inc., Samsung Electronics Co. Ltd., Analog Devices Inc., Intel Corporation, and STMicroelectronics NV. These companies are prominent players in the Global IoT Chip Market.
What is IoT in electronics?
IoT in electronics refers to a network of interconnected devices, such as appliances and physical objects, embedded with sensors and software, enabling them to collect and exchange data over the internet and other networks.
What is the size of the IoT semiconductor market?
The size of the IoT semiconductor market is projected to grow at a compound annual growth rate of 5.5% from $427.0 billion in 2021 to reach $693.8 billion by 2030.
What is an IoT chip?
An IoT chip is an electronic device capable of connecting to wireless networks and transmitting and receiving data using various protocols such as NB-IoT, LTE, and BLE 5.0.
What is the projected growth of the IoT chip market?
The projected growth of the IoT chip market is from USD 392.0 billion in 2020 to USD 1.16 trillion by 2029, with a compound annual growth rate (CAGR) of 14.9%. This indicates a significant expansion in the market over the next decade.