Internet-of-Things platforms are predicted to grow to a £1.7bn industry over the next five years, with total IoT platform revenues forecasted to grow by at a compound annual growth rate of 32.2 per cent.

According to research by analyst firm Berg Insight, IoT platform revenue will increase from €450m (£326m) in 2014 to €2.4bn by 2020, with third party IoT platforms driving a growth in diversity of functionality and application areas.

Most IoT platforms focus on either connectivity management, device management or application enablement, allowing companies and organisations to develop and deploy solutions faster and at a lower cost by offering standardised components that can be shared across multiple solutions in different industries.

“M2M often involved highly customers solutions deployed within single industry verticals or companies to improve existing business operations,” said André Malm, senior analyst at Berg Insight. “IoT focuses on gaining new insights from analytics based on data from diverse sources to support decision making, and improve products and services.

“In the past, companies have often developed M2M solutions where connected devices sent data via a network directly to an application that handled data storage and processing, security and business logic. These solutions normally required long development cycles and high cost, with little scalability and flexibility to handle a growing number of devices and evolving functional requirements.”

As the market for connected devices grows, more and more platforms are embracing multi-purpose structures that will enable them to service multiple industries in a variety of ways, leading to a new generation of platforms that can be adapted to business needs easily and quickly.