Enterprises are spending as much on the Internet of Things as on cloud, mobility and analytics, according to Vodafone’s annual research into the sector.

The operator’s 2016 IoT Barometer found that respondents are dedicating 24 percent of their IT budgets to the IoT.

This is slightly more than is being allocated to mobility (23 percent), cloud (23 percent) and analytics (22 percent).

The survey covered 1,096 people in 17 countries across nine industry verticals.

Currently, 28 percent have at least one “live” IoT project although 76 percent said the IoT would be “critical” for future success.

The most popular types of use cases include fleet management and remote vehicle monitoring, building automation, security, automating supply chains, and creating new connected home and usage based-insurance (UBI) products.

Almost half, 46 percent, of respondents who have launched an IoT project said they planned to launch their own connected product within two years.

Erik Brenneis, Vodafone’s Director of IoT, noted that the operator was in talks with insurers in Italy, Spain and the UK about developing UBI-related services.

Further, he said the operator was using its own sales channels to sell some products that its customers were developing.

Vodafone saw a 29 percent increase in IoT revenues in the 2015/16 financial year.

The operator does not share what the precise figures are, but Brenneis said they were “getting closer” to €1 billion.

Automotive, energy and industry/manufacturing remain the sectors that Vodafone serves the most, and Brenneis said he did not see this changing over the next 12 months.

Telcos, rather than emerging players such as Sigfox, remain Vodafone’s biggest competitors, according to Brenneis.

He said the conceived wisdom in the market that Sigfox was a cheaper technology than cellular was incorrect.

The exec is excited by the fact that businesses in the survey are making money from their IoT projects.

In the Europe, Middle East and Africa region, 63 percent of respondents said they are seeing “significant” return on the investment.

The more that enterprises invest in the IoT, the greater the RoI they see.

The report found that 79 percent of enterprises that allocate more than 40 percent of their IT budget to the IoT see “significant” RoI, while just 45 percent of those that allocate less than 10 percent see the same result.

More than one fifth, 21 percent, of those seeing significant RoI say that their company’s revenue has increased by more than 10 percent in the last year.

One of perennial challenges to the IoT is being “demystified” according to Brenneis.

The survey found that over half, 56 percent, of respendents said IoT security is fundamentally no different to any other type of IT security.

Rather, enterprises are more concerned about data protection.

But the communications or connectivity provider should not be ultimately responsible for ensuring end-to-end security of IoT project, according to respondents.

The majority, 20 percent, said this was the job of IoT service aggregators, while 19 percent said systems integrators.

Communications or connectivity providers were chose by 17 percent of respondents.

Brenneis said: "Three-quarters of the companies we interviewed now recognise that the Internet of Things is a new industrial revolution that will change how people work and live forever, and almost half the companies surveyed across multiple countries and sectors told us they're already planning to bring connected network intelligence to millions of devices and processes over the next two years.

“2016 is the year the Internet of Things entered the mainstream."

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