Supply chain to benefit from “robust” demand for connected devices

Increasing demand for connected devices is driving a “paradigm shift” in the way communication services are delivered and consumed, giving a much-needed fillip to the electronics supply chain they depend on, according to new findings from Frost & Sullivan.

The US firm, one of the world’s leading providers of market research, adds that over 6bn connected devices were shipped worldwide in 2011, and this total will grow strongly to reach 9.29bn by 2016.

This growth is expected to be driven by consumers favouring technology that allows them to manage home security, energy consumption, and video streaming from anywhere, as well as engage in activities like working from home, online shopping and social interaction.

“The favour of connected devices amongst consumers is expanding the scope for electronic original equipment manufacturers (OEMs),” said Nupur Sinha, Research Analyst at Frost & Sullivan. “The proliferation of smartphones and the acceptance of their capability to connect to a television and function as a smart TV are other factors for the growth of connected devices.”

Among the changes being wrought in the supply chain is the use of embedded sensors and chips in connected devices, requiring equipment and component manufacturers to keep pace with these advancements. Because of this, manufacturers prefer to partner with mobile operators who offer flexibility to consumers, claims the report.

“Operators will look to partner with OEMs for design collaboration, as well as strategic research and development,” concluded Sinha. “The right partnership between mobile operators and OEMs can help generate revenues from connected devices, spurring market growth.”

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