"We're seeing more and more of our customers who look at these devices as a huge source of data that they can use to drive increased business efficiencies in business intelligence," said Kevin Dallas, general manager of the Windows Embedded business at Microsoft.

Microsoft itself is enhancing its Windows Embedded operating system to accommodate the future needs of more complex embedded systems, Dallas said. For instance, it is developing a machine-to-machine connection manager, code-named Pontecchio, that would offer fine-grained control over when devices connect to network services, which would make their data transfers more predictable.

For the report, the IDC researchers looked at buying habits across seven major industries, namely communications, computing, consumer, energy, health care, industrial and transportation. They also examined the road maps of the major processor architectures, including ARM, MIPS, IBM's Power Architecture and x86.

IDC is a division of International Data Group, the parent company of IDG News Service.

The IDG News Service