The number of new companies adopting Internet of Things services has slowed, data from Vodafone has shown, but the operator’s IoT chief remains upbeat that the latest tech will unleash the next wave of market entrants.

The UK-based company’s latest annual IoT Barometer, which polled 1,278 execs across eight sectors, reveals that 29 percent of businesses around the world have adopted IoT, up from 12 percent in 2013.

Asia-Pacific leads the way today, with 36 percent of companies having adopted the technology, ahead of the Americas with 27 percent.

Europe, meanwhile, is slightly behind the curve with 26 percent.

However, global growth has slowed markedly in the last two years, with adoption rising just two percentage points since 2015.

Speaking to European Communications, Vodafone’s IoT Director Erik Brenneis is keen to look at the stats another way.

He points out that the number of companies with over 50,000 IoT connections has doubled in the past 12 months to six percent of all adopters.

“We’re seeing bigger, more integrated programmes spanning business functions,” the report notes.

Moreover, Brenneis says that customers are becoming ever more positive about the IoT with companies now seeing it increasingly as a way to generate revenues as opposed to saving costs.

Vodafone’s own stats suggest there is no problem – the number of IoT connections it provides rose 42 percent to 54 million in the year to 31 March.

This is an increase on the 37 percent growth it recorded in the year to 31 March 2016.

Brenneis says its most up-to-date IoT connection count stands at 59 million, while revenues rose 6.4 percent to €183 million in the three months to March.

With the GSMA claiming earlier this month that mobile operators have an opportunity to tap into $1.8 trillion of IoT revenues by 2026, it would appear the only way is up.

But could the drop off in the number of new companies choosing to go down the IoT path be a harbinger that things are not as well as they seem?

Researchers at Analysys Mason, who contribute to Vodafone’s Barometer, would appear to think so.

“It may be that we are approaching the end of a phase of IoT,” they note in the report.

“Companies have put in place solutions that can solve relatively simple problems — low-hanging fruit.

“Often these are point solutions that do not require complex integrations or the support of a wide range of stakeholders in an organisation.

“The next phase may be precisely these more complex projects, and these will take time.”

Brenneis admits Vodafone is “shifting” towards bulking out the IoT estates of existing customers, but suggests this is no bad thing.

Citing the likes of car manufacturer VW, which plans to add IoT connectivity to every car in the group from next year, he suggests new business units within large conglomerates are just as valuable as new customers.

Analysys Mason points to wider opportunity with SMEs, among which it says there is “still a lack of awareness” about the IoT.

“Raising awareness among SMEs and delivering affordable, off-the-shelf solutions will contribute to the next wave of adoption,” the analyst house believes.

Given the IoT falls under Vodafone’s multinational-focused Global Enterprise (VGE) division, has the operator overlooked the SME market, which is typically served by the opcos in its various markets?

Not so, says Brenneis, who took over as Chief Executive of VGE last year.

He is currently looking after the IoT beat as well, a job he held for seven years, as the company looks to replace Ivo Rook who left earlier this year.

“When I did IoT job [full time] I always focused on all the sales channels – multinationals, corporates, SME and even SOHO,” he says.

“We have pretty stable businesses in the opcos addressing SMEs.

“I don’t think it is a question of the sales channel even though I agree we need to continue to focus on selling to all [types of companies].

“I think it is more that SMEs don’t have the same number of experts like multinationals [do] and I think they normally come a little later in terms of adoption.”

Rather, Brenneis sees a lack of innovation as a possible reason for the slowdown in new IoT adopter numbers.

“I don’t see a lot of completely new apps at the moment based on existing tech we have,” he says.

“I personally believe that new technology like NB-IoT can drive completely new business models in the sense that it will be worth connecting things that before weren’t connected, eg fire sensors, gas meters.”

Vodafone has recently begun deploying such networks in countries such as Ireland and Spain.

“I believe we will see growth from new and existing [companies] over the next years but new tech will also lead to next wave of new connections,” Brenneis says.

Time will tell whether this a lull in the IoT storm.

Read more: "Complacent" companies need to wake up to IoT security, Vodafone urges

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