3 trends driving the growth of IoT adoption in APAC

The APAC IoT market is poised to grow at an annual rate of 25.8% between 2019 and 2026 to reach $436.77 billion by the end of the forecast period, according to a Frost and Sullivan analysis in 2021¹. This growth is opening up numerous opportunities in the manufacturing sector in Asia, especially in smart city initiatives, transportation, and logistics.

Governments in the region are pushing ahead with various smart infrastructure projects to provide people with better health services, transport facilities, and mobility. The transportation sector is also being disrupted as consumers seek better solutions that promise safety, convenience, and efficiency while logistics providers are also discovering new ways to put IoT to use for tracking and optimising supply chains.

The APAC region has been at the forefront of smart city projects. Countries like Singapore, which launched its Smart Nation initiative in 2014, and China are leading the way in leveraging IoT solutions for creating smarter, safer cities.

The applications of IoT in smart city projects vary across cities, ranging from better energy utilisation, to controlling disease outbreaks, autonomous vehicles, fintech, and contactless payment innovations. They are also put to use for broader governance applications like urban planning, evidence-based decision-making, and infrastructure development.

The interest in 5G and IoT among organisations in Asia has grown even more due to external factors such as the pandemic and supply chain disruptions. According to a 2021 survey by Ernst & Young, 84% of enterprise executives in Asia-Pacific showed an increased interest in 5G and IoT technologies due to the COVID-19 pandemic while 79% cited disruptions to global supply chains as another factor. This is also driven by the need to improve data management, and workforce productivity and to optimise systems and processes. In the APAC region specifically, enhancing energy efficiency is a prominent rationale for investing in IoT. In fact, 72% of respondents also said that Environmental, social, and governance (ESG) issues were a factor in their increased interest in 5G and IoT technologies³.

Closely tied to smart city projects are initiatives that leverage IoT to improve transportation. This involves vehicles equipped with IoT connectivity that collects data on traffic, other vehicles, road quality, and others to provide users with a number of smart features that make transportation safer and more convenient. Today's consumers are also looking out for these features, with a 2020 McKinsey survey showing that 37% were willing to change car brands for improvements in autonomous driving, connectivity, electrification, and other features³. 39% of respondents in the survey also expressed interest in unlocking additional features after purchasing the vehicle.

Beyond connected vehicles, IoT solutions are also being deployed to make public transportation systems better and more convenient for commuters. Singapore for instance will roll out its next-generation electronic road pricing (ERP) system, which will use IoT to help monitor and manage traffic conditions island-wide⁴. The Land Transport Authority (LTA) in Singapore is also using IoT sensors to mine sources of data such as WiFi, cellular data, farecard, train, and taxis for warning commuters and agencies about potential rail disruptions and incidents in real-time⁵.

With the rise in online shopping, demand for better customer service, and convenience in e-commerce delivery, the logistics industry has been pushed to transform its supply chains. There has been a need for end-to-end supply chain visibility while challenges such as dynamic changes in route conditions, on-demand trends, volume spikes, and flexible workforces also need to be addressed. This has led providers to explore IoT solutions for real-time fleet tracking and management solutions.

According to a Frost & Sullivan survey, almost 21% of logistics companies in Asia currently leverage IoT for their fleet management solutions and this is set to increase more in the coming years⁶. Real-time route planning is one of the major applications, with 77% of the survey respondents rating this as extremely important. Telematics, which are IoT-based solutions designed for vehicles, can help with this by allowing fleet operators to capture data about vehicle performance, passengers, and cargo. Sensors can also monitor the temperature of perishable goods, vibrations of fragile items and also track the routes of transport vehicles by connecting them with GPS devices. With IoT connectivity allowing two-way communication through these devices in real-time, operators can notify vehicles and drivers about updates, re-routings, traffic disruptions, and weather changes to ensure timely delivery of goods.

To make each of these IoT solutions work for consumers, manufacturers need reliable communication networks at the core of their ecosystem. Each use case will have its own specific needs pertaining to bandwidth and latency, while different regions in Asia will also have different levels of connectivity and regulations. 

OEMs should therefore look to partner with connectivity solution providers with a centralised platform to roll out across multiple markets and who can offer services across the APAC region. Singtel offers a Multi-Domestic Connectivity solution to help OEMs simplify regional logistics, operations, and distribution and centralise the management of connectivity. Its single embedded SIM (eSIM) helps deliver connectivity services over an access point name (APN), allowing OEMs to manage their entire lifecycle with simplified ordering and batch management.

This is precisely what helped a German OEM when they were looking for a connectivity solution to scale the distribution of their connected devices across the APAC region. They adopted Singtel’s Multi-Domestic Connectivity solution to enable device connectivity via an embedded SIM and were able to access a centralised, open integration platform to support all its target markets and a single unified portal to manage the SIM lifecycle for all deployed countries.

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¹ Frost & Sullivan, Mega Trends Transforming the Internet-of-Things Market in Asia-Pacific, 2021.

² Ernst & Young, Enterprise 5G: is the Industry 4.0 growth opportunity being overlooked, 2022.

³ McKinsey, Unlocking the full life-cycle value from connected-car data, 2021.

⁴ The Business Times, To build a smart nation, Singapore must be hyperconnected, 2021.

⁵ AI Singapore, A Smarter Way to Manage Mass Transit in a Smart City: Rail Network Management at Singapore’s Land Transport Authority, 2021.

⁶ Frost & Sullivan, The State of Movement: Asia Pacific, 2021.