The small Unmanned Aerial System (sUAS) market continues to develop at an impressive pace and is unmarred by the challenges of COVID-19. Global tech market advisory firm, ABI Research, predicts strong growth of the industry worth $92 billion by 2030.

While the pandemic has dented consumer shipments and hindered commercial rollout, this has been mitigated by increased use of drones for public service responses and surveillance by both local and national police forces.

Looking forward, new regulatory changes and the slow rollout of remote ID and 5G will enable an enormous upscaling of drone operations, from single remotely operated aircraft to semi-autonomous fleets that will be able to operate beyond visual line of sight courtesy of impending unmanned traffic management (UTM) infrastructure. This will provide the base from which companies like Amazon can launch drone delivery services.

“We have gone through various phases of the drone industry, from its genesis in the military to the proliferation of consumer drones. Since Chinese developer DJI monopolized that space, the attention has shifted to commercial applications,” said Rian Whitton, senior robotics analyst at ABI Research. “While some of the initial hype has subsided, providers and end-users are refocusing on developing the necessary supporting infrastructure and services to make drone technology viable at scale.”

Drone pilots

Overall, the drone market is set to be worth $92 billion by 2030, with a CAGR rate of 25% over the $9.5 billion in annual revenue for 2020. Of this revenue, 70% is in the commercial sector ($63 billion).

The largest number of drone registrations are currently in the United States, where the Federal Aviation Authority (FAA) tracks 1.7 million consumer drone pilots and 400,000 commercial operators. China is catching up with 400,000 registered drones, while the European Union (EU) has over one million registrants. Among the biggest markets are security and industrial inspection, with growing opportunities in delivery, agriculture, and emergency services.

With their involvement in the public response to the pandemic, drone companies highlighted their value. Now, the story of the next decade will be the development of key technologies like edge computing, cloud services, and 5G connectivity enabling mass deployments, in tandem with regulatory harmonization.

“While cloud services will help enable the collection and orchestration of massive amounts of data, 5G will significantly reduce latency for mission-critical drone operations. The advancement of edge computing and processing hardware will also be important, as drones can be untethered from the remote operation and become truly autonomous,” Whitton said.

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Robot-related services powered by cloud computing will reach US$157.8 billion in annual revenue by 2030, according to new figures released by ABI Research.

The analyst firm says despite being only in its nascent stages, the value of cloud infrastructure to robots is key for both deployment (encompassing development, configuration, and instalment) and operation (maintenance, analytics, and control).

With the popularisation of mobile robotics in a wide range of verticals, it will become necessary to utilise the computing power of cloud infrastructure to store and manage the vast troves of collected data as well as to train more advanced algorithms used to power robot cognition, it says.

“Since 1961, most commercial robots have been wired or tied to external infrastructure for movement. The next generation of robot deployments will be increasingly mobile, tied to cellular and WIFI connectivity, will consume vast troves of data in order to operate autonomously, and will need effective management through real-time measurements for performance, status and operability,” explains Rian Whitton, senior analyst at ABI Research. 

“Several cloud service providers, including AWS, Microsoft Azure, and Google Cloud, have begun collaborating with robotics developers, while start-ups like InOrbit target cloud-enabled operations for the first major deployment of mobile service robots.”

Whitton says the journey of the robot industry from one of individual vehicles and units, to fleets and larger systems, is being driven by its wider incorporation into the IoT ecosystem. 

“However, it would be a mistake to suggest robots will simply fit in with devices, individual sensors, and stationary machines as part of the wider IoT ecosystem,” he says.

“Robots are increasingly sophisticated systems themselves, with multiple sensors and highly advanced Artificial Intelligence (AI)/Machine Learning (ML) competencies, and are also expected to move around and act within the world, generating huge amounts of data relative to other machines. 

“To suggest the cloud alone can provide the computing power to operate these machines is nave, especially during the slow transition to 5G. Onlookers should instead conceive of adaptable edge-cloud systems that focus on quality over quantity when it comes to robotics operation, data processing, and analysis,” Whitton adds.

The cloud robotics opportunity, defined as Robotics-as-a-Service (RaaS) and Software-as-a-Service (SaaS) revenue for robotics operations combined, will grow from US$3.3 billion in 2019 to US$157.8 billion in 2030, accounting for 30% of the robotic industry’s total worth. 

On its own, this represents a huge opportunity for start-ups, many of which are beginning to expand on their mission to enable developers to accelerate their go-to-market strategy and to help end-users and operators access and manage the ever-increasing fleets of robots, ABI Research says.

This new robotics ecosystem will be dominated by three subcategories of companies, namely robot developers that move up the value chain and become solution providers, third-party IoT and cloud platform providers focused on best-in-class software solutions, and Cloud Service Providers (CSPs) like Microsoft Azure, Amazon Web Services (AWS), and Google Cloud.

Those focusing strictly on hardware will lose relative worth and will require partnerships or bold strategies to become solution providers. This can be exemplified by companies like Universal Robots and Fetch Robotics, who have incorporated software and maintenance services into their offering.

“The market is incredibly nascent at present. ABI Research expects consolidation with the most successful robot solution providers and the CSPs expanding their relative influence on the market to take place within the next decade,” says Whitton. 

“The cloud robotics technology is split between vertical innovations, such as developing superior navigation systems, which increase the possibility of what robots can do, and horizontal innovations that expand access and scalability. Cloud computing represents the most important horizontal innovation for the robotics industry, to date, and will further enable vertical innovations like swarm-based intelligence, autonomous mobility and advanced manipulation to be deployed at scale.”

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Internet of Things connections are expected to exceed 23 billion across all major IoT markets by 2026, according to new figures from ABI Research. 

The analyst firm’s Device Authentication in IoT technology analysis report reveals almost all those connections will be faced with incessant and constantly evolving cyber-threats, forcing implementers and IoT vendors to embrace new digital security options to protect managed fleets and connected assets. Secure device authentication currently stands among the top-tier investment priorities for key IoT markets. 

It expects that hardware-focused IoT authentication services will reach US$8.4 billion in revenues by 2026. reach US$8.4 billion in revenues

“There are several key technologies revolving around authentication security that currently transform the IoT device value chain. Chief elements among them revolve around IoT identity issuance, provisioning, authentication, encryption key lifecycle management, access management, and attestation,” explains Dimitrios Pavlakis, industry analyst at ABI Research. 

“These are the prime focus of IoT vendors who capitalise on the emerging threat horizon to better position their services and explore new IoT monetisation models,” he says.

“As it currently stands, the IoT is not a secure place for future deployments and both IoT players and digital security vendors are aware of that,” says Pavlakis. 

“The good news is that the recent change in thinking has caused a noticeable mentality shift and investment surge for secure authentication technologies across the IoT ecosystem; the bad news is that this also gives rise to many IoT management offerings with questionable levels of security and intelligence.”

According to Pavlakis, IoT authentication services need to consider a plethora of variables, sharing both operational and connectivity as well as security characteristics. 

“Just because cybersecurity investments need to enter deeper into the IoT deployment equation does not mean that operational variables will be left unaccounted,” he says. 

“Bandwidth capacity, connectivity requirements, operational specifications, and device heterogeneity, digital footprint and processing power, edge-cloud dependencies, telemetry and intelligence are all key factors that need to be addressed to obtain a sustainable growth for the IoT going forward.”

ABI Research says many IoT security vendors are taking advantage of the recent IoT investment surge to increase their market footprint and deliver security-first authentication and management services for the IoT supported by a multitude of flexible pricing models. 

According to the report, market leaders and innovative companies offering Internet of Things security services operating in different areas of the IoT value chain include Intel, Microsoft Azure, Amazon Web Services, Entrust Datacard, Rambus, Data I/O, as well as Globalsign.

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While Internet of Things (IoT) will be integral to the long-term recovery plans of the post-COVID-19 economy worldwide, ABI Research said some facets of the IoT itself will be negatively impacted in the short term.

In its latest report “Assessing the Impact of COVID-19 on the IoT Market”, the technology research firm predicts an 18% drop in the net addition of IoT devices in 2020 as a result of manufacturing shut-downs, supply chain interruptions, and changes in connected product availability and demand.

This equates to the loss of 66 million potential Wide Area Network (WAN) connections over previous forecasts. Proportionally, the most heavily impacted markets will be fleet and other heavy vehicles/equipment. These are expensive assets that enterprises are buying less of in the interests of cost control. Fixed assets, digital signage, and kiosks also face huge impacts, as they are driven by a entertainment and retail sector that has been effectively put on hold by the massive reduction in personal mobility and footfall, and increased emphasis on online shopping.

“COVID-19’s impact on the IoT is three-fold. Some applications will experience a decline in shipments during 2020, ergo a reduction in the expected growth rate to their installed base. Yet, with no intrinsic change to their desirability and utility, they will return to expected growth in subsequent years,” said Jamie Moss, research director for M2M, IoT and IOE at ABI Research.

He added:  “Some will experience a temporary stall in 2020 that will be compensated  by increased activity immediately after, to bring things installed base expectations back into line. While others will experience fundamental shifts in demand, both positive and negative, for years to come as consumer and enterprise priorities shift in the light of COVID-19.”

In the consumer space, passenger vehicle and connected car markets are suffering considerably as people stay in place. Yet, by spending more time at home, improving the function and comfort of that environment is expected to boost smart home revenues. For enterprise, while utility metering initiatives face delays as home visits are temporarily prohibited, they are expected to bounce back fast. At the same time,  asset tracking, inventory management, and condition-based monitoring are all set for greater long-term investment to build better businesses that allow people to do more with less and to reliably run things remotely.

Moss noted the diversity of the IoT and the pragmatic nature of its utility.

“At ABI Research, we analyse 32 IoT applications, that’s 32 different types of connected device embedded in the fabric of the world around us. Each provides information on where things are, what their status is, and what actions we must take. To be forewarned is to be forearmed and the mass use of Microcontroller Unit (MCU)-based Low Power Wide Area (LPWA) sensors can help us make a safer world, where we can quickly respond to threats. The IoT is a market that grows naturally as and when it right for it to do so, to deliver planned results. And the need for guaranteed outcomes has never been more acute than now.”

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