Beecham Research is warning companies planning to get into the Internet of Things (IoT) market not to believe all the hype and over optimistic predictions.
Some industry commentators are forecasting the number of connected devices at anywhere between 10 billion and 50 billion by 2020, and trillions of dollars in new revenue by 2025.
Beecham Research believes these numbers to be 'unrealistic' and 'potentially damaging' to the industry if they are believed, and companies build their business plans and funding expectations on such ‘false promises'.
"There is no doubt that the M2M and IoT markets are moving quickly and there are great new business opportunities, but with unrealistic predictions around the growth of connected devices, there is also the risk that companies will run out of time and money before they see a return on their investment," said Robin Duke-Woolley, CEO at Beecham Research.
"We know that today, excluding mobile phones and general purpose devices like tablets, there are significantly less than one billion connected devices worldwide.
"To suggest that growth rates exceeding 50% per annum are credible when the long term growth in this market has been consistently in the range 20-30% per annum prompts the question - why and what is likely to accelerate the overall growth rate so spectacularly?
"There is no answer to that. Equally problematic, even if those numbers could be achieved in shipments, there is not nearly enough resource available to install and implement them."
Duke-Woolley is particular critical of predictions of trillions of dollars of new revenue. "We need to get real here," he said. "The total GDP of the United States - the biggest national economy in the world - is currently 12 trillion dollars annually. To suggest that new revenue from IoT will approach even 10% of this over a 5 to 10 year period is unrealistic and unhelpful."