IoT Software Market-Global Size & Upcoming Industry Trends

Description

IoT Software Market Synopsis

IoT Software Market Size Was Valued at USD 2.01 Billion in 2024 and is Projected to Reach USD 12.69 Billion by 2032, Growing at a CAGR of 25.90% From 2025-2032.

IoT software can be defined as the package of solutions, applications, platforms, and protocols used for connectivity, control, and monitoring of devices and systems via the use of the internet. This software helps in the connection of the sensors, actuators, and other devices in a network for the sense, control, and respond framework. ThingsTalk IoT software comprises features that are data storage, real time analysis, device control, and security which are the key entities to build smart spaces and the automation integration to client verticals including healthcare, manufacturing, transportation, home automation, and more among others.

The various industries are embracing new technologies and it is witnessed that IoT (Internet of Things) software market is growing and also changing at a high pace due to connectivity, data analytics in various things. This market mainly consists of various kinds of software tools that can help to handle, process, and connect data from connected devices.

Several factors make IoT software market to grow as explained below. First of all, the growing use of IoT ranging across manufacturing, healthcare, transportation, smart cities, and many others has created a demand for high-quality software. These solution empower the organizations to manage the largest possible amount of data which will be produced by the IoT devices for better operational control, better decision making procedures and revenue generation.

Secondly, the accomplishments made within the realms of clouds and edge computing are critical for IoT software characteristics. The Cloud IoT platforms for IoT data storage and processing, and Edge computing, allow for near real-time data processing at the devices level thereby minimizing latency.

Also, there is a growing trend of advancing AI and ML within IoT software, which improves the models of prediction, detection of anomalies, and decision automation. These technologies enable businesses to make decisions that enhance consumption and utilization of resources as well as identify potential maintenance problems in the supply chain.

To classify the IoT software market, it has been divided on the basis of the type of software, deployment mode, application, and end-user industry. Some of the key software solution types include IoT platforms, AEP, DM platforms, and vertical specific analytical tools for IoT data. All of them are designed for separate purposes, starting from organizing connection and security of devices to creating data visualization and possible failure anticipation.

Regarding the deployment model, it is possible to choose between cloud, installed, and combined models depending on the security, growth, and legal protocol needs of the organization. Solutions are divided equally between cloud solutions due to their availability, the ability to scale the capacity needed and relatively low one-off payments and on-premises for industries which require high security for stored data.

The firms that dominate the IoT software market can be classified as both the traditional IT majors and emerging challenger firms. Microsoft (Azure IoT), Amazon Web Services (AWS IoT), IBM (Watson IoT), and Google (Google Cloud IoT) dominate the proportional IoT market by offering end-to-end IoT solutions that come with a built-in cloud service interface, AI/ML applications, and edge computing SDKs. IoT startups or players operating in niche markets innovate in IoT applications, solutions dedicated to industry verticals, or facilitating IoT connected device to other devices/ software integration.

However, the market of IoT software is to face certain difficulties such as data security questions, the questions of IoT platforms’ cooperation, and the questions of cooperation of various IoT ecosystems which are rather prospective. Constant screening of the security measures, adherence to the laid down protocols for communication and integration of all the stakeholders are some of the things that will help to address these challenges effectively.

In the future, the software market for the IoT is expected to continue its growth facilitated by the enhancement of 5G technology, increasing the amount of devices (IoT endpoints) and the evolution of industry 4. 0 initiatives. Challenges such as these will only serve to fast-forward the growth of IoT solutions, foster innovative advancement in the sphere of IoT software, and alter industries’ business models.

Thus, the IoT software market is an opportunity and a promising area in the context of the overall development of technologies. The industry stakeholders will continue investing in IoT software solutions that are scalable, secure, and disruptive and those with AI incorporated will continue to stoke market growth.

Iot Software Market Trend Analysis

IoT Software Market AI and Machine Learning Adoption

Currently, the growth in the IoT software market is tremendous due to the rising trends in the incorporation of AI and the use of machine learning. These are altering the IoT platforms in power supply, where they are able to process large volumes of data from sensors, control and plan operations, and anticipate the time of need of maintenance. Many industries including manufacturing, healthcare, transportation, and smart cities currently embraced artificial intelligence and machine learning on the optimization of processes, timely decisions, and customers’ experience.

Some of the primary use cases include prognostics and health management, Smarttyping of faults, and artificial intelligence-based control, which is transforming the manner in which connected devices communicate and function within networks. Future development of AI entails more use of complex algorithms and deep learning in the development of IoT software; giving impetus to the market growth, as is driven by increased demand for solutions that will spur new business development and improvement of operations based on data.

IoT Software Market Security Enhancement Solutions

The software market has increased with the connectivity of the various IoT devices across different industries to cater to a strong security solution. These solutions are very important as they solve the growing problems of data security, cyber security risks, and security standards and compliance in IoT implementations. Some of the key developments are the stressing of encryption techniques, secure device management interfaces, and complex systems of authentication to shield the conducted data transmission and interaction of the devices.

Also, AI-based anomaly detection and behaviour analysis are critical in recognizing and combating threats in real-time, thus improving the general position of cybersecurity. While the scale and density of IoT increases, so does the requirement for broad security solution that members of the ecosystem are striving for trend, best-fit security solutions which are easily scalable, compitable with different IoT platforms and able to counter new threats.

Iot Software Market Segment Analysis:

Iot Software Market Segmented based on Component, Deployment Mode, Application , Organization Size, Industry Vertical, and Region.

By Component, Software Solutions segment is expected to dominate the market during the forecast period

Determination of IoT software market can also be made based on its segments which largely include; The different software solutions and services. Software solutions are the pillars of IoT implementations ranging from platforms, applications, and middleware solutions to support device management, data processing, and application development. These solutions are critical for handling the connection between various IoT devices, the flow of data, and analysing the stream of information in real-time.

They can cover features such as security measures, devices’ connectivity control, and APIs to construct a consistent IoT environment. As for IoT services, they are critical to the processes of IoT solutions deployment, integration as well as their long-term operation. These services can span from consultation and integration of the IoT system to its support, maintenance and other managed services to fit the numerous needs of enterprises that use IoT technologies. Together, software solutions and services form the Internet of Things software market, which helps foster new ways of creating value, performance, and adaptability of connected environments in various industries such as manufacturing, healthcare, transportation, and the smart city.

By Application , Smart Energy and Utilities segment held the largest share in 2024

The IoT software market by applications is split into smart manufacturing, smart energy and utilities, smart mobility and transportation, smart healthcare, smart building, and smart retail. Each of them describes a sphere that is getting more adopted to IoT solutions in order to make the operation more effective, resource consumption better controlled, and new services offered. In smart manufacturing, IoT software is involved in real-time controlling of production processes and in predicting the time of equipment failure, supply chain management, and so on, and thus helps the manufacturers in increasing the returns on investments. IoT software in smart energy and utilities help in the management of smart grids, in efficient load management and in the incorporation of renewable energy — all to fulfill sustainability missions. Smart mobility/transportation means that IoT solutions cover solutions that would otherwise cover vehicle tracking, traffic control, and optimized fleet, making travelling easier and traffic more efficient.

Smart healthcare deploys IoT software for distant supervision of patents and for tracking of assets within the hospitals, to provide individualized healthcare and also avail improved results for the patient as well as better working for the healthcare givers out there. Smart buildings employ IoT software that addresses the needs of automation for the building systems, energy efficiency and ways of optimizing occupant’s comfort. Last but not the least, in smart retail IoT solutions are used for managing inventories, using the beacon to offer tailor made services to the clients, recording the behavior of the clients and increasing the sales as a result of the smart retails. Thus, the analysis of the IoT software market based on its applications reveals that segmentation by application makes is diverse across industries, all of which contribute to the development of IoT ecosystems and digitalization initiatives worldwide.

Iot Software Market Regional Insights:

Asia Pacific is Expected to Dominate the Market Over the Forecast period

Among all the regions, the Asia Pacific region will be positioning itself in a commanding position in terms of the IoT software market during the course of the forecast period. As we have also mentioned these developments are in line of the following factors. First, advancing urbanization and industrialization in countries such as china, India, and South Asian nations are creating suitable ground for IoT to be implemented in smart city projects manufacturing and logistics. Second, the emerging greater spending in ITCs by governments and enterprises as a result of strengthening their digital foundations are driving the IoT market to provide more solutions in making organizations efficient, reduced costs and improving services’ delivery.

Third, growth of smart devices and increased availability of telecommunications networks such as internet of things, particularly the development of the 5G network systems continues to expand the IoT in sectors like health, farming and logistics. Furthermore, the favorable policies and programs for IoT innovation and start-ups are developing the market even more in the region. With regard to IoT software, the Asia Pacific region is expected not only to take the lead but also to introduce new changes and improvements to the IoT environment worldwide.

Active Key Players in the Iot Software Market

Microsoft Corporation (US)

IBM Corporation (US)

Cisco Systems Inc. (US)

Amazon Web Services (AWS) (US)

Google LLC -(US)

Oracle Corporation -(US)

SAP SE – Germany

General Electric (GE) -(US)

Siemens AG – Germany

PTC Inc. (US)

Other Active Players

Key Industry Developments in the IoT Software Market

In January 2023, Lifecycle Software, collaborated with Microsoft where Lifecycle Software leverages the Microsoft Cloud across its solutions, allowing some of the biggest mobile operators to provide improved services to customers.

In November 2022, ZainTech, the digital and ICT solutions powerhouse of Zain Group, partnered with Oracle where it selected Oracle Exadata Cloud@Customer to introduce new technology services to enable business advantages for its customers across the Middle East.