IoT connections outlook

The Massive IoT technologies NB-IoT and Cat-M – supporting wide-area use cases involving large numbers of low-complexity, low-cost devices with long battery lives and low-to-medium throughput – continue to be rolled out around the world. 5G reduced capability (RedCap) is starting to gain traction and has now been commercially launched by 14 service providers across multiple global markets. Furthermore, 42 service providers in 27 countries are currently investing in 5G RedCap technology.^[1] Enhanced RedCap (eRedCap) is designed to further reduce the complexity and cost of 5G IoT devices. It offers lower peak data rates of 10 Mbps compared with RedCap. Use cases for eRedCap are similar to LTE Cat-1 and LTE Cat-1 bis, offering a compromise between performance and cost. To make 5G fully relevant for low-cost IoT, eRedCap will be introduced, with lab trials starting this year. Full commercial potential for eRedCap is expected in 2028 and beyond.

The number of Broadband and Critical IoT (4G/5G) connections was around 2.6 billion by the end of 2025 and these are expected to continue to connect the largest share of cellular IoT devices through 2031. This segment mainly includes wide-area use cases that require higher throughput, lower latency and larger data volumes than can be supported by Massive IoT devices. LTE Cat-1 devices, which support 10 Mbps downlink and 5 Mbps uplink speeds, are increasingly being used for a variety of use cases. This rise is fueled by growing demand for new use cases and the need to shift away from legacy technologies.

2G and 3G networks continue to be shut down around the world to refarm spectrum for use with 4G and 5G. In many markets, the phasing-out of 3G networks is expected to occur more rapidly than that of 2G in the upcoming years, as sunsetting 3G networks enables the reuse of spectrum to strengthen 4G and 5G user experiences. 2G networks, with their minimal use of spectrum, will continue to be utilized for voice and legacy IoT services for a longer duration. By the end of 2025, 80 service providers had completely finished shutting down their 3G networks, while 46 service providers had fully turned off all 2G services.^[2]

The growth of Massive IoT technologies is enhanced by added capabilities in the networks, enabling Massive IoT to co-exist with 4G and 5G in frequency division duplex (FDD) bands, via spectrum sharing.

By the end of 2031, a majority of cellular IoT connections are forecast to be Broadband IoT. As 5G New Radio is being introduced in old and new spectrum, throughput data rates will increase substantially for this segment. North East Asia is the leading region in terms of the number of cellular IoT connections, with a share of around 70 percent of all connections by the end of 2025.

Figure 5: IoT connections (billion)

Note: Based on rounded figures. Cellular IoT figures are also included in the figures for wide-area IoT.