Italy

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In 2016 Italy experienced a substantial growth of the IoT market, which was worth 2.8 billion euros, 40% more than the previous year [3], driven by both consolidated applications that leverage mobile connectivity (€ 1.7 billion, + 36%) and those using other technologies (€ 1.1 billion, + 47%). This boost was mostly due to public policies requiring the installation of at least 11 million gas smart meters by 2018.

In addition to gas smart meters, Smart Cars drove the market, with 7.5 million of circulating connected cars: these two areas alone account for more than half of the IoT turnover. The two mentioned areas, together with IoT deployments in buildings (Smart Building), especially for security purposes, make over 70% of the total market value.

In 2016 the number of “objects” grew too: 14.1 million objects are now connected by mobile network (+ 37%), without counting the objects that use other communication technologies, such as the 36 million electrical smart meters connected through PLC connected (Power Line Communication), the 1.3 million gas smart meters that communicate by radio frequency, and 650,000 smart luminaires connected via PLC or radio frequency.

The main segment of the IoT market (34% of the total) consists of Smart Metering and Smart Asset Management in utilities, where the regulatory requirement for gas meters has led to an explosion of IoT solutions: the market has grown from 500 million euros in 2015 to 950 million in 2016 (+ 90%). At the second place (20% of the total) in the market there is the segment of the Smart Car, which has grown by 15% and reached 550 million euros, despite the reduction of the prices for GPS/GPRS box prices, which in absolute terms weakens the market value growth.

The third largest share in the Italian market belongs to the Smart Building solutions (510 million euros, 18% of the market), an area that grew by 45% compared to 2015, particularly driven by the supply of security-related solutions in buildings. Smart Logistics solutions for transport occupy the next spot (250 million euros, 9% of the market) used for fleet management and satellite burglar control. Smart Home is worth 185 million euros and 7% of the market (+ 23%), with a strong prevalence of security applications [3].

Other domains have still to express their potential, in particular, three areas should be monitored: Smart City, whose potential is still widely unexpressed, Retail, where IoT could serve as a collector of data for customers’ profiling and behavioural advertising within the stores, and the Smart Agriculture, where the IoT offers opportunities not only in terms of product traceability, but also in the management of agricultural activities.

The delay of Smart City applications is noteworthy in the IoT market. Their value is estimated in 230 million euros, or 8% of the total market’s turnover. In the Smart City domain IoT is deployed in limited areas - such as public transport with 200,000 remotely monitored vehicles and intelligent lighting with 650,000 lighted-light poles [3].

In the near future, a further acceleration of the IoT market is expected for the Industrial IoT, which is supported by the incentives provided in the National Industrial Plan 4.0, which will include in the next four years investment in research and development and tax incentives for companies investing in technologies and projects to support the Fourth Industrial Revolution.

Key points of the Plan [8], incorporated in the Budget Law 2017 [9], are:

  • A public investment of about 20 billion euros;
  • A super and hyper amortization of 140% and 250% for newly acquired capital goods supporting the technological and digital transformation of the production processes;
  • A 50% tax credit on R&D investments;
  • Incentives on investments in start-ups and innovative small businesses.