Colombia takes LatAm lead in industrial IoT

Colombia's industrial internet of things (IoT) market is one of Latin America's most advanced, especially in smart mobility. But connectivity challenges need to be overcome if it is to realize its potential, according to consultancy Frost & Sullivan.

In a web presentation, Frost & Sullivan senior digital transformation consultant Gina Sánchez said the Colombian industrial IoT market will generate revenue of nearly US$524mn in 2022, with most spending over the next five years going to the automotive and manufacturing verticals.

According to Sánchez, the IoT ecosystem is fragmented with different entities working together to provide end-to-end solutions.

Mature areas are hardware and connectivity, but more integrated platforms are needed, the analyst said.

Hardware currently represents 44% of industrial IoT revenues followed by connectivity (32%), software (17%) and services (7%).

VERTICALS

The transport & mobility segment is the most mature, representing 24% of the IoT market. It will grow at a CAGR of 20% by 2022. According to Sánchez, Colombia will have 800,000 connected cars by 2023 and new manufacturers are expected to arrive.

Healthcare and agriculture have much growth potential, too. These areas could grow 26% over the next five years respectively as technology helps to improve efficiency and productivity and bring down prices. The smart agriculture market is forecast to reach US$60mn in 2022.

Other growth verticals include smart industry, expected to grow 21%, energy & utilities (+24%), and smart cities (+26%).

During the World Economic Forum in Davos last month, President Iván Duque announced that Medellín had won a competition by the Inter-American Development Bank (IDB) to host one of the global Fourth Industrial Revolution Network's affiliate centers, the others being in the US, Japan, China and India.

The centers that make up the network are set to be global hubs for public and private collaboration. During the last years, Medellín has gained international recognition due to innovative practices in a sustainable environment and land use management, economic investment, infrastructure, technology, mobility, and research.

Medellin is going to deploy 64 electric public vehicles this year, the largest fleet of its kind in the country and the second largest in South America after Santiago, Chile, where a fleet of 100 zero-emissions buses was deployed last year.

CHALLENGES

Sánchez said that basic connectivity throughout the country was in place thanks to the Vive Digital program implemented over the two terms of President Manuel Santos, but other types of connectivity would be needed so more spectrum should be tendered.

"5G is one of [those types of connectivity] but we will not see that in the short term. Spectrum is a restraint. But with other types of connectivity such as narrow band LTE there have been more advances," Sánchez said in response to a question from BNamericas.

"If we compare Colombia to other Latin American nations we have down good groundwork with Vive Digital, deploying fiber optic networks. But certain things haven't been taken care of yet such as spectrum for 5G."

Colombia's ICT ministry is proposing to reform ICT legislation while President Duque has promised to encourage the development of the orange economy, based on digital innovation and services.

Also Read ICT Infrastructure Report: Colombia faces challenges in connecting the last mile