IoT Analytics: The Internet of Things Enters the Era of Agentic and Physical AI
A report by IoT Analytics published in February 2026, titled “State of Enterprise IoT 2026,” reveals that the enterprise IoT market grew by 13% in 2025 to reach $324 billion, with projected growth of 14% in 2026 driven by AI technologies and major markets such as India and China. The number of connected IoT devices globally reached 21.1 billion by the end of 2025.
The analysis highlights a notable shift in corporate earnings discussions—from IoT toward industrial AI and autonomous operations—indicating that IoT has become a foundational capability, while the market moves into advanced stages of agentic and physical AI.
The report identifies three critical transformations:
- Device shift: Chipmakers are embedding AI accelerators into microcontrollers
- Connectivity shift: Connectivity is fading into the background while expanding via satellite and ubiquitous coverage
- Software shift: Software is becoming more assistive, moving toward self-optimizing orchestration
Currently, less than 1% of IoT devices feature true edge AI components, but this figure is expected to rise significantly in the coming years.
Industrial Tech Radar: AI Leads While “Maturity Gap” Emerges
Another February 2026 analysis by IoT Analytics, titled “Digital Industrial Technology Radar 2026,” identifies 64 industrial digital technologies and classifies them by maturity and market impact.
- AI & Machine Learning: 21 technologies
- Automation & Robotics: 18 technologies
- IoT Devices & Connectivity: 13 technologies
- Cloud, Software & Security: 12 technologies
The report highlights a “maturity gap,” where market attention is focused on less mature technologies such as agentic AI, physical AI, and humanoid robotics, while mature technologies like LPWAN, real-time operating systems, and time-of-flight sensors receive less attention despite widespread adoption.
It also notes that connectivity standards such as OPC UA and time-sensitive networking are rapidly maturing due to global standardization efforts.
TRAI Chairman: IoT and M2M Will Form the Neural Network of the 5G Economy
In a keynote speech at the ETTelecom 5G Congress 2026 on March 20, 2026, Anil Kumar Lahoti, Chairman of Telecom Regulatory Authority of India, emphasized that IoT and machine-to-machine (M2M) communication will form the neural network of the future connected economy.
He outlined several regulatory priorities:
- Enabling a comprehensive M2M framework
- Promoting eSIM technologies with profile-switching mechanisms
- Introducing critical classifications for essential IoT services
- Ensuring coordinated spectrum availability, including millimeter wave and terahertz bands
He also stressed the central role of AI in enabling predictive maintenance, automated optimization, and smart traffic management—while emphasizing responsible AI deployment with strong data governance and human oversight.
ABI Research: Edge AI Dominates While RAM Shortage Threatens IoT
A field analysis by ABI Research (April 9, 2026), based on insights from Mobile World Congress Barcelona and embedded world 2026, highlights key trends:
- IoT is now “implicitly assumed” rather than a headline topic
- Focus has shifted toward robotics and drones in industrial and environmental use cases
- Edge AI emerged as the dominant theme, with minimal emphasis on cloud AI
The report warns of a looming crisis:
- A RAM supply shortage—driven by demand from AI data centers—may impact IoT device manufacturers
- Some hardware vendors risk exiting the market due to memory constraints
Connectivity trends include:
- Cat-1bis dominating cellular IoT
- Slow rollout of 5G RedCap, though adoption is emerging in North America and China
- Strong presence of the eSIM SGP.32 standard, simplifying subscriber provisioning
China’s $3.5 Trillion IoT Plan: From Connectivity to Intelligent Operations
In breaking news on March 31, 2026, nine Chinese government entities—including the Ministry of Industry and Information Technology—announced the IoT Industry Development Action Plan (2026–2028).
Key targets:
- Tens of billions of IoT connections by 2028
- Core IoT industry exceeding 3.5 trillion yuan
More importantly, the plan signals a paradigm shift:
- From “intelligent connectivity of everything”
- To “intelligent operation of everything”
AI models are positioned as gateways to the physical world, supported by an edge–cloud–device architecture and technologies like microkernels and virtualization.
The plan also promotes:
- Advanced AI agents with sensing, decision-making, and execution capabilities
- Lightweight deployment of large AI models at the edge
This marks the evolution of devices from passive data collectors into autonomous intelligent agents.
Monogoto: Embedding Intelligence into Connectivity Infrastructure
On March 2, 2026, Monogoto won the Merit Awards for Telecom & Wireless (AI category) for its innovation in embedding intelligence directly into SIM, signaling, and network layers.
Its platform enables:
- Proactive monitoring
- Anomaly detection
- Autonomous response across cellular, private networks, and satellite connectivity
The company emphasizes that modern connected devices—from sensors to autonomous machines—require built-in intelligence, security, and compliance, not just connectivity.
Juniper Research: Emerging Tech Trends Shaping IoT in 2026
A January 2026 report by Juniper Research identifies key emerging technologies:
- Post-quantum cryptography (moving toward deployment)
- Neuromorphic computing (addressing edge AI constraints)
- Physical AI and humanoid robotics
- Multi-agent systems enabling autonomous operations
The report highlights 2026 as a turning point where previously theoretical technologies enter operational planning stages.
CIMG & Quack AI: Toward an Agent Economy and M2M Micropayments
On March 11, 2026, CIMG signed an MoU with Quack AI to explore integrating AI automation with regulated digital asset and decentralized finance infrastructure.
The initiative aims to:
- Enable autonomous economic activity by software agents
- Support machine-to-machine micropayments
- Bridge AI automation with secure financial systems
This reflects a growing trend of combining AI with blockchain to enable machine-driven economies.
Mender: Edge AI Becomes the New Standard in IoT
A February 2026 analysis by Mender highlights 2026 as a turning point where IoT device manufacturers move from pilots to large-scale product portfolio transformation with edge AI capabilities.
Key developments:
- Increased demand for local processing (latency, privacy, efficiency)
- Integration of lightweight neural processing units (NPUs) in chips
- Edge AI handling real-time responses, while cloud focuses on long-term analytics
However, challenges are rising:
- Increased security and reliability risks
- Need for continuous model management and OTA (over-the-air) updates
- Shift toward subscription-based models driven by AI features
Conclusion: IoT Becomes the Backbone of an Autonomous Intelligent World
In 2026, IoT and M2M communications are entering a new phase where connectivity infrastructure itself becomes intelligent and distributed. AI is moving from centralized data centers to the edge and endpoint devices, enabling real-time autonomy.
From China’s large-scale national initiatives to industry reports confirming market maturity and the rise of autonomous operations, the message is clear:
IoT is no longer just about connecting devices—it is becoming the backbone of an intelligent world, where machines can independently make decisions and execute complex tasks collaboratively.
At the same time, real challenges remain—particularly around security, component shortages, and the need for unified standards—making this transition both transformative and complex.
Sources:
