During the forecast period, the worldwide smart space market is expected to increase from USD 9.4 billion in 2020 to USD 15.3 billion in 2025, with a Compound Annual Growth Rate (CAGR) of 10.2 percent. Market growth will be fueled by rising venture capital funding, green construction programmes and environmental concerns, and increased investments in smart space technologies.
Impact of COVID-19 on the Smart Space Market
The COVID-19 pandemic has had an impact on every business in the world, including the smart space market. Because the smart space market ecology is heterogeneous, the entire ecosystem will have different impacts. The outbreak will have a favourable impact on a few sectors of this ecosystem, while others may experience a decline. For example, following COVID-19, many businesses have adopted the work-from-home model, necessitating better residential space utilisation. Business continuity is one of the key concerns for organisations during the pandemic, which has resulted in a significant growth in supporting and connected services. Globally, smart space suppliers have been more active in assisting end-users with physical environment security. As a result, demand for security management systems has skyrocketed. Companies in the smart space industry are likely to see a decline in demand for smart space and smart building solutions once the lockdown is lifted in key cities around the world, resulting in lower revenues over the next two quarters.
Emergency management is expected to develop at the fastest CAGR throughout the projected period, based on application.
With the appropriate information and enough time on their hands, residents can move quickly to limit or completely avert damage. Smart cameras with enhanced image sensors can now keep an eye on remote corners 24 hours a day, seven days a week to increase the security element of any building. In research labs, power plants, and other highly secured environments, ultrasonic location tracking systems can quickly identify occupants’ movements, locations, and orientation. The systems provide a storage feature that allows users to save data for a set period of time, which can be utilised for future reference. Another technology that is now available in the entertainment centre and kitchen area is smart floor, which tracks the location and identifies inhabitants when they fall, as well as reporting it to emergency services. British Telecom (BT), Everything Everywhere (EE), and HCT have developed a new technology called Advanced Mobile Location that can turn on the Global Navigation Satellite System (GNSS) and Wi-Fi (AML). The technology would automatically transmit the exact location details with the emergency service provider after the emergency number has been phoned, and it is 4,000 times more accurate than the existing method in use.
Component, space type, application, end user, industry vertical, and region are the segments that make up the global smart space market. The market is split into hardware, software, and services based on component. It is divided into smart interior spaces and smart outdoor spaces based on the type of space.
It is classified into energy management and optimization, layout & space management, emergency & disaster management, security management, and others, depending on the application. Smart space market share is divided into residential and commercial segments depending on the end user. Energy & utilities, transportation & logistics, healthcare, education, retail, manufacturing, government, and others make up the commercial category. The market is divided into four regions: North America, Europe, Asia-Pacific, and Latin America and the Caribbean.
Furthermore, the proliferation of smart buildings prompted by the pandemic is having a favourable impact on the market. Social distancing, occupancy tracking/monitoring, ventilation and air-conditioning (HVAC) systems, smart heating, and tougher cleaning requirements are all features of smart buildings.
Top influencing factors
The expansion of the worldwide smart space market is impacted by a number of factors, including the proliferation of advanced technologies like as the Internet of Things (IoT) and artificial intelligence (AI). Furthermore, an increase in greenfield projects and an increase in environmental concerns around the world are likely to drive market expansion. However, the high initial capital expenditure necessary for connected devices and other gear, as well as rising privacy concerns about data manipulation, are projected to stymie market expansion throughout the projection period. In addition, a surge in smart city projects across all regions, as well as the development of 5G technology, are likely to present significant potential prospects for the market in the future years.
Many businesses and solution providers, particularly in developed nations, are focusing on entering the market with more innovative and advanced products and services because smart space solutions and services are still relatively new. As a result, early investors are spending a lot of money to install new technologies, whereas many underdeveloped countries lack the infrastructure and resources to get a head start. Due to a lack of new markets and related sectors in surrounding emerging nations, this concentration has happened in advanced regions. Most organisations are now providing their services in other regions as a result of Foreign Direct Investment (FDI) and the ease with which corporations can access these markets. As a result, organisations want to avoid investing a significant amount of money in human resource training and instead choose to hire people who are already trained.
Projection of Growth:
Over the projection period, the global smart space market is estimated to grow at a CAGR of 17.9%, with market size rising from USD 13.19 billion in 2020 to USD 66.12 billion in 2030. Growing demand for green buildings as a result of environmental concerns is estimated to drive market revenue growth during the forecast period.