Internet of Things (IoT) Investments: European Execs Outpace U.S. Counterparts
American executives are investing significantly less than their European counterparts when it comes to Internet of Things (IoT) technology. That’s according to a Bain & Company study, which surveyed more than 500 American and European executives in multiple industries. The survey looked at their investment, optimism, and integration priorities for IoT between now and 2020.
Among their findings:
- Only 8% of US executives said they are already implementing IoT and analytics case applications, compared with 18% of European executives
- Fully one-quarter of the Europeans plan to implement IoT solutions in multiple cases and integrate them with their IT systems by 2020, compared with 16% of the US executives
- 39% of IoT customers in Europe rated security concerns as a major obstacle to IoT adoption, compared with 27% of US customers
- Automotive executives in Europe are allocating 24% of their IT budgets to IoT, compared with only 19% of IT budgets within the US automotive industry, and in retail, industrial and buildings, the percentages are also higher in Europe
European investment will likely create a competitive advantage in multiple industries, according to the study’s authors. Auto, healthcare, transportation, financial services and more could all benefit as IoT becomes more popular.
IoT Priorities: U.S. vs. Europe
Europeans also appear to have different priorities surrounding IoT. Two-thirds of European execs say they’re excited about the potential to improve existing products using IoT tech and advanced analytics. Only around one-third of their American counterparts ranked that as a priority, the report said.
Still, one out of four executives in the U.S. expect IoT to help bring down waste and costs, with only 35 percent of Europeans answering the same. Bain & Co. suggests this difference could be because Europeans are further ahead in implementing the tech and so have a better idea of what they want to pursue.
Global enthusiasm for IoT has pumped more than $80 billion into M&A investments by major vendors and more than $30 billion from venture capital firms, Bain estimates. The study’s authors say IoT could provide opportunities not seen since the rise of digital and executives should be looking to take advantage of the technology to gain a competitive advantage.
Bain & Company is one of the world’s largest management consulting firms.