Robust Demand For Connected Devices Boosts Electronics Supply Chain

New analysis from Frost & Sullivan, Global Analysis of the Future of Connected Devices and Impact on Electronics Supply Chain Participants, finds that the market shipped over 6.06 billion units in 2011 and estimates this to reach 9.29 billion units by 2016.

Consumers favor technology that allows them to manage home security, energy consumption, and video streaming from anywhere, as well as engage in activities like working from home, online shopping and social interaction.

“The favour of connected devices amongst consumers is expanding the scope for electronic original equipment manufacturers,” said Frost & Sullivan Research Analyst Nupur Sinha. “The proliferation of smartphones and the acceptance of their capability to connect to a television and function as a smart TV are other factors for the growth of connected devices.”

Connected devices are evolving swiftly with the use of embedded sensors and chips, requiring equipment and component manufacturers to keep pace with these advancements. Because of this, manufacturers prefer to partner with mobile operators who offer flexibility to consumers.

It is thus crucial for mobile operators to evaluate, implement, and leverage next-generation mobility management tools that allow them to meet the unique needs of value chain participants, and understand the increased functionalities of smart phones.

Integrating services across various networks and creating a connected home environment where internal and external networks interconnect for seamless service delivery is vital.

However, high investment costs that offer no immediate returns deter operators from investing in the connected devices market. For instance, cable operators wanting to offer a connected home must integrate other third-party services with their own, delivering these services to selected markets without flash-cutting the delivery network. These are complex, costly and need limited interest in connected home spaces.

In addition, while the connected home concept has been around for a few years, consumers are not sure of what is currently possible. Nevertheless, awareness is expected to increase, as more smart devices enter the market.

“Operators will look to partner with OEMs for design collaboration, as well as strategic research and development,” concluded Sinha. “The right partnership between mobile operators and OEMs can help generate revenues from connected devices, spurring market growth.”