The top 15 Internet of Things cities in the world
It is an interesting phenomenon in every industry: Companies cluster in specific cities or countries.
The big global clusters of:
- Financial firms: New York and London.
- Pharmaceutical firms: Switzerland and New Jersey.
- Automotive companies: Japan, Michigan, and Germany.
- Anything web-related: California
Which are the emerging company clusters of the Internet of Things?
The ranking of Internet of Things cities
According to the IoT Analytics database of 2000+ IoT companies, the top 15 emerging Internet of Things cities (based on company headquarter location) are the following:
1. San Francisco / Bay Area (Silicon Valley)
The San Francisco bay area is the technology motor of the world. And it will continue to do so as the Internet of Things industry matures. Today, the area counts already more than 300 headquarters of companies that are active in the Internet of Things.
The dominance is fueled by both a large number of small new startups as well as some of the top 20 Internet of Things companies such as Google, Apple, or Cisco. The bay area has it all: Semiconductor companies such as Atmel, sensor manufacturers such as Invensense, or analytics providers such as Splunk.
Generally speaking, companies that are based in Silicon Valley tend to be more focused on consumer IoT applications and less focused on business-facing IoT applications than elsewhere.
2. London, UK
Home to the popular IoT platform Evrythng or the minicomputer Raspberry Pi, London is becoming the IoT capital of Europe. What further boosts London’s position is its traditional strong footprint in Telco and M2M. It is home to the GSM Association and the international M2M council; Telco giants such as BT and Vodafone have its footprint in London.
3. New York City, NY, USA
New York may not have any large multi-national Internet of Things companies but there are some rising stars that originate in the largest city of the United States. Among them are the Quirky/Wink smart home solution or the Canary security system.
4. Boston, MA, USA
Due to its strong base of world-class universities such as Harvard or MIT, Boston is known to be a world leading city in innovation. Therefore, it is no surprise that some of the most innovative IoT companies have its headquarters in the area. Examples: Predictive analytics company RapidMiner or MC10 Inc., a pioneer in wearable electronics.
5. Los Angeles, CA, USA
Los Angeles is a hub for wearable devices. More than 50% of the IoT companies that are based in LA make wearable devices for the end-user (the average for other cities is around 15% of companies). And most of these companies are small unknown startups such as Trakdot or Daqri . The most well-known may be the “Puls” by the singer “Will I am”.
6. Paris, France
Like LA, Paris also stands out as a city with a high number of IoT device manufacturers (>50% of the companies). Moreover, companies in the French capital offer quite a few IoT platforms that promise to allow connectivity for your things (e.g., Beebotte, Sen.se, Weio).
7. San Diego, CA, USA
San Diego is the third Californian city in the top 10 list. But in contrast to San Francisco and LA, a large number of the San Diego IoT companies focus on the business-facing side of the Internet of Things (rather than consumer-facing). San Diego heavy-weights include General Atomics, Qualcomm, Novatel Wireless, or Systech.
8. Chicago, IL, USA
In 2014, Chicago hosted the Internet of Things World Forum. Despite Chicago’s effort to “become the most digitally connected city in the world”, it is home to a number of connected health and smart grid companies. The most promising startup of the city might be TempoIQ, a real-time database built specifically for the Internet of Things.
9. Seattle, WA, USA
Driven by Amazon and Microsoft, Seattle makes it into the list of top 10 cities. Other notable Internet of Things companies based in the Seattle area are the connected car platform Airbiquity and industrial IoT startup Seeq.
10. Bangalore, India
Known as the “Silicon Valley of India”, Bangalore is producing a number of startups in the field of the Internet of Things. Many of these provide IoT platform capabilities such as Altiux or ConnectM. The most well-known company, perhaps, is Wipro – the large multi-billion IT solution integrator.
11. Toronto, Canada
12. Tokyo, Japan
13. Hong Kong / Shenzhen, China (counted as one region)
14. Berlin, Germany
15. Denver, CO, USA
Why it matters?
Some estimates see the economic potential of the Internet of Things on a global scale surpassing the size of the total economic output of the USA in 10 to 15 years . That means: IoT will be a massive driver of global economic growth.
It would be wrong to assume that the leading cities will shift dramatically in the coming years. Both research as well as evidence from other industries show that clusters tend to become bigger over time because they underlie some unique self-enforcing effects:
- Sharing immediate inputs (e.g., It is much easier to have your hardware manufacturer around the corner if you develop an IoT solution so you can discuss challenges and provide feedback in person)
- Sharing a labor pool (e.g., if an IoT startup fails, the employees can move on to a more successful IoT company and immediately have impact with their skills and expertise)
- Knowledge spillovers (e.g., IoT firms that are physically close to each other share knowledge, discuss ideas, and develop partnerships)
This ranking can therefore be seen as a first indicator as to which regions might profit most from the Internet of Things in the coming years. (employment, tax revenues)
IoT Analytics has developed a database of 2000+ IoT companies based on our own research and automated web queries.
The Internet of Things companies on this list were double-checked and then clustered by technology offering and by end-user segment (if applicable). Using Geocoding, all company headquarters were plotted on a map and counted in the wider metropolitan area in which they are based. The list of 2000+ IoT companies can be purchased on our website. We do not claim completeness of all IoT companies but we believe it is the most complete and structured list on the market.