The European IoT market will exceed $ 26B this year boosting subscription-based business models
In Telecoming we have analyzed the role of connected objects in the new subscription economy. In 2020 there will be more than 10B connected objects in Europe, according to Juniper Research. This figure will grow by 25% each year until 2023. The European IoT hardware and software market will exceed $ 26B in 2020, representing 25% of the global market estimated at more than $ 105B for this year. With an average year-on-year growth of 18%, the European market will reach 41B in 2023.
Experts agree that the IoT has different ways to monetize itself, and subscription is a real alternative. This model can convert hardware into services, as it has done before with products like albums or movies.
IoT strongly embraces the subscription model as a profitable alternative
24/7 connectivity of IoT products is the key to recurring revenue business models. Subscription to services is a consolidated reality in other industries supporting the trend known as subscronomics.
An IoT subscription model introduces business as a service for a system made up of software and hardware. The collection of data and constant communication with the client allows companies to offer new functionalities and personalized services. This customization can occur with flexible models.
According to Roberto Monge, our Chief Operations Officer: “The monetization of connected objects is one of the significant challenges of the future. Besides, businesses have changed radically in recent years giving rise to what is known as subscronomics. IoT opens the door to consolidate this social-economic movement promoted by technology and new users’ habits.”
Subscronomics, when customer intentions drive the economy
As we announced in our previous post: Subscronomics, the Economic Theory of Innovation and social changes have promoted this new movement.
Subscronomics is a term used to define the crucial role that technology has in models based on recurring revenues. The modern society welcomes this trend driven by significant changes in consumer consumption models.
At Telecoming we want to welcome the recurring economy and society! The new era of Subscronomics is here!