By Dylan Martin

November 21, 2025, 10:00 AM EST

Executives and analysts talk to CRN about eight big trends they’re seeing in the IoT market this year, ranging from an AI skills gap and the infusion of new AI innovations into products, to a push by customers for interconnectivity among vendors and ongoing security concerns.

With the ongoing AI development boom driving demand for IoT solutions and enabling new capabilities, the industry is facing some growing pains.

These hurdles include a skills gap in the IoT workforce when it comes to integrating new AI innovations into products and services, according to Satyajit Sinha, principal analyst of IoT component, connectivity and security at research firm IoT Analytics.

[Related: How AI Is Driving Demand For IoT Solutions And Enabling New Capabilities]

“Everyone will go through that phase: that if you want to implement AI within your industry, within your company, you need to make your employees skilled [in this area],” he said in a recent interview with CRN.

Sinha is among a handful of analysts and executives who gave their input on what they are seeing for big and noteworthy trends in the IoT market this year.

Among those trends are the impact of President Trump’s evolving tariff strategy and other trade-related actions that have taken place across the world.

Carlos Gonzalez, research manager of industrial IoT and intelligence strategies at research firm IDC, said tariffs have impacted the cost of raw materials, impacting pricing and margins for vendors selling IoT hardware.

“IDC did a sentiment survey and found that 60 percent of enterprises view rising tariffs as a threat to profitability and tech budget stability,” he told CRN.

Another area of concern in the IoT market is cybersecurity, according to Danny Johnson, vice president of IoT and managed connected platforms at Verizon Business.

“Depending on the build of a specific deployment, IoT devices can span multiple locations, involve devices from various manufacturers with different security capabilities and operate in environments where physical security is limited,” Johnson wrote.

“To cover these different potential attack vectors, IoT deployments can require a more complex security setup than the traditional IT environment,” he added.

As for opportunities in the IoT market, Lantronix Chief Strategy Officer Mathi Gurusamy pointed to the need for collaboration to boost the AI-driven industrial IoT ecosystem.

“The future of AI-powered IIoT [industrial IoT] will be defined by collaboration—where hardware, software and connectivity providers join forces to build integrated ecosystems that support hybrid AI models for edge intelligence,” he wrote.

What follows are explanations of these and other big trends in the IoT market this year as explained by Sinha, Gonzalez, Johnson and Gurusamy.

Dylan Martin

Dylan Martin is a senior editor at CRN covering the semiconductor, PC, mobile device, and IoT beats. He has distinguished his coverage of the semiconductor industry thanks to insightful interviews with CEOs and top executives; scoops and exclusives about product, strategy and personnel changes; and analyses that dig into the why behind the news. He can be reached at dmartin@thechannelcompany.com.