The IoT Chip Market in Government is estimated at US$4,783.770 million in 2025 and is anticipated to grow at a CAGR of 6.95%, attaining US$6,695.010 million by 2030.
The Internet of Things (IoT) has the potential to transform the public sector by changing the way government entities collect data and information with emerging trends of mobility, automation, and data analytics. The growing usage of connected devices is increasing the volume of big data worldwide. As such, the demand for the application of IoT in the government sector is rising to gather and process this large volume of data, thereby driving the IoT chip market growth. The use of IoT in the government sector ensures the smooth functioning of day-to-day public activities while focusing on long-term, demanding projects.
IoT is being increasingly adopted in key public areas, including water control, emergency management, and waste management. Increasing investments in smart cities is fueling the demand for IoT chips across the government sector. Government agencies are using IoT to analyze factors such as population, zoning, mapping, water delivery, and even land use, which are essential for planning and policy-making.
Rising cases of disaster, both man-made and natural, are further boosting the adoption of IoT solutions across this sector, thus positively impacting the IoT chip market growth. Governments are increasingly using IoT and big data-enabled disaster prevention and management systems to reduce the loss of life and property during unforeseen disasters. For example, forest fires are common, and IoT solutions are being used to detect fires in their early stages to curb the spread of the fire and its consequent devastating effects. IoT can also help detect and monitor water bodies and alert authorities in areas prone to flooding by letting them know when the water level rises at an alarming rate.
Another key area where governments are funneling investments into IoT solutions to reduce traffic congestion, road accidents, and carbon footprint is the growing focus on intelligent transportation systems, which is also driving demand for IoT chips. Other factors that are bolstering the IoT chip market in government include the rising use of IoT for video surveillance solutions in public places and burgeoning demand for roadside signage for smart roads and highways that display toll rates, real-time road status, and lane closures.
A major factor propelling the global IoT chips market’s expansion in the governmental sector is its increasing investments and introduction of subsidiary policies to boost the development of new-age technologies like semiconductors, AI, and IoT. Several countries worldwide, like India, China, Japan, and the USA, have introduced key policies and investment opportunities to boost the development of the latest technologies in their respective nations. The development and integration of AI across the governmental sector are expected to propel the IoT chips market’s growth, as AI technology necessitates the availability of reliable and continuous connectivity to the internet.
For instance, in April 2024, Microsoft, a global leader in software and computer technology, announced its investment plan in Japan for developing AI and cloud computing. The company invested about US$2.9 billion, which is aimed at the initiative of the government of Japan to develop the nation's AI and cloud computing capabilities.
Increasing internet utilization across multiple government services is also expected to expand the IoT chips market. Various governments worldwide, like India, Japan, the USA, and Canada, have introduced various internet-based platforms and solutions, allowing the local population to avail themselves of or connect with the governments. Services like documentation, verifications, tourism, laws & guidelines, and local services are being provided using the mode of internet globally. With the increasing reliability of internet-based services around the globe, the demand for IoT chip solutions is also expected to grow significantly.
North America accounted for a significant market share during the forecasted timeline, owing to the high adoption rate of IoT solutions and services across the government sector. Governments in countries like the U.S. and Canada are increasingly incorporating IoT technology into different key areas, especially in law enforcement. Amazon’s video doorbell Ring, a home security IoT product, is being used by law enforcement agencies across the United States, allowing police to view home surveillance footage to assist with their investigations.
Moreover, these governments are also focusing on security measures to account for rising cyberattacks related to IoT products and systems. The law aims to better address the data security risks associated with increased connectivity at the workplace. This is the first IoT-specific security law in the United States, which requires all IoT devices sold in California to be equipped with reasonable security measures. The system aims to improve the accuracy and speed of decision-making regarding issuing evacuation warnings and regulating traffic to ensure the safety of residents. An increasing number of connected devices, along with the rapidly rising internet penetration, is also contributing to the regional IoT chip market in government.
| Report Metric | Details |
| IoT Chip Market in Government Size in 2025 | US$4,783.770 million |
| IoT Chip Market in Government Size in 2030 | US$6,695.010 million |
| Growth Rate | CAGR of 6.95% |
| Study Period | 2020 to 2030 |
| Historical Data | 2020 to 2023 |
| Base Year | 2024 |
| Forecast Period | 2025 – 2030 |
| Forecast Unit (Value) | USD Million |
| Segmentation |
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| Geographical Segmentation | North America, South America, Europe, Middle East and Africa, Asia Pacific |
| List of Major Companies in the IoT Chip Market in Government | |
| Customization Scope | Free report customization with purchase |