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Internet of Things outlook

The Ericsson Mobility Report June 2017 highlights that the number of connected IoT devices is growing, driven by an increasing range of use cases and business models, and supported by falling device costs.


Key findings

  • Between 2016 and 2022, IoT devices are expected to increase at a CAGR of 21%
  • 1.5 billion IoT devices with cellular connections by 2022
  • Several operators are expected to deploy cellular IoT networks based on Cat-M1 and Narrow Band-IoT (NB-IoT) in 2017

Around 29 billion connected devices1 are forecast by 2022, of which around 18 billion will be related to IoT. Connected IoT devices include connected cars, machines, meters, sensors, point-of-sales terminals, consumer electronics2 and wearables. Between 2016 and 2022, IoT devices are expected to increase at a CAGR of 21 percent, driven by new use cases.

IoT device connections

In the figure below, IoT is divided into short-range and wide-area segments. The short-range segment largely consists of devices connected by unlicensed radio technologies, with a typical range of up to 100 meters, such as Wi-Fi, Bluetooth and ZigBee. This category also includes devices connected over fixed-line local area networks and powerline technologies.

The wide-area segment consists of devices using cellular connections, as well as unlicensed low-power technologies, such as Sigfox, LoRa and RPMA. Presently, the dominating technology in this segment is GSM/GPRS.

1.5 billion IoT devices with cellular connections by 2022

At the end of 2016, there were around 0.4 billion IoT devices with cellular connections. Due to increased industry focus and 3GPP standardization of cellular IoT technologies,  this number is projected to reach 1.5 billion in 2022,  or around 70 percent of the wide-area category.

Within the wide-area IoT segment, two distinct sub-segments with different requirements have emerged: massive and critical applications.

Massive IoT connections are characterized by high connection volumes and small data traffic volumes, low-cost devices and low energy consumption. Many things will be connected through capillary networks.3

Critical IoT connections place very different demands on the network: ultra-reliability, availability, low latency and high data throughput. Declining modem costs, evolving LTE functionality and 5G capabilities are all expected to extend the range of applications for critical IoT deployments. There are, however, many use cases between these two extremes, which today rely on 2G, 3G or 4G connectivity.

The first cellular IoT networks supporting massive IoT applications, based on Cat-M1 and Narrow Band-IoT (NB-IoT) technologies 4,were launched in early 2017. Several operators are expected to deploy cellular IoT networks in 2017.

Graph: Connected devices (billions)

In our forecast, a connected device is a physical object that has a processor, enabling communication over a network interface. 
Note: Traditional landline phones are included for legacy reasons

Including: Smart TVs, digital media boxes, Blu-Ray players, gaming consoles, audio/video (AV) receivers, etc.

Connected devices connecting to a wide-area network through a common gateway.

4 Cat-M1 supports a wide range of IoT applications, including content-rich ones, and NB-IoT is streamlined for ultra-low throughput applications. Both these technologies are deployed in LTE networks.