IoT connections outlook
The number of cellular IoT connections is expected to reach 4.1 billion in 2024 – increasing with an annual growth rate of 27 percent.
- The number of cellular IoT connections is expected to reach 4.1 billion in 2024, of which 2.7 billion will be in North East Asia.
- Service providers are deploying both Cat-M1 and NB-IoT in their markets to cater for diverse use cases.
- Since 2013, the number of cellular connected devices has grown at a compounded annual rate of 33 percent.
There is an emerging trend toward communications service providers deploying one IoT network that supports both Cat-M1 and NB-IoT technologies. This enables them to address the diverse and evolving requirements across a wide range of use cases in different verticals, such as utilities, smart cities, logistics, agriculture, manufacturing and wearables.
Massive IoT cellular technologies such as NB-IoT and Cat-M1 are taking off and driving growth in the number of cellular IoT connections worldwide. Of the 4.1 billion cellular IoT connections forecast for 2024, North East Asia is anticipated to account for 2.7 billion – a figure reflecting both the ambitions and size of the cellular IoT market in this region.
These complementary technologies support diverse low-power wide-area (LPWA) use cases over the same underlying LTE network. The table to the right shows the IoT connections forecast, where the cellular IoT connections category is part of the wide-area IoT segment.
More advanced IoT use cases emerging
As the IoT application market is widening, more advanced use cases requiring enhanced network capabilities are emerging. Examples of such capabilities are support for optimized voice quality, more accurate device positioning and support for device mobility at high speed.
Service providers have announced the deployment of 85 cellular IoT networks worldwide using Cat-M1 and/or NB-IoT.1 In both Europe and Asia, deployments of Cat-M1 have commenced, while NB-IoT is now also being deployed in North America, in addition to the ongoing deployment of Cat-M1 technology. Both technologies are being deployed to complement each other across regions worldwide.
Large-scale deployments, and the resulting high-volume chipsets, are expected to continue to reduce chipset prices. This is leading to further acceleration of the growth in cellular IoT connections.
IoT connections (billion)
|- Cellular IoT2||1.0||4.1||27%|
IoT traffic characteristics
Since 2013, the number of cellular connected devices has grown at a compounded annual rate of 33 percent. Over the same period, traffic per connected device has grown much faster due to an increasing share of devices generating higher traffic volumes. However, cellular IoT traffic still represents a very small portion of total mobile traffic in service providers’ networks.
Most of today’s cellular IoT applications generate relatively small data traffic volumes in mobile networks. The installed base of IoT devices is a distribution of 2G, 3G and LTE technology. A majority of these are 2G devices, due to the long life cycles of sensors and applications with basic requirements. This distribution is expected to change as a broader range of use cases evolve over time, along with the continued deployment of supporting LTE-based IoT technologies and future capabilities of 5G networks.
IoT traffic volume is limited but increasing
To date, IoT has been characterized by a very large number of connections, small data volumes and, in some cases, stringent requirements on energy consumption. Typical uses are sensor, monitor or control data IoT applications. In many markets, ultra-low-end IoT applications with limited demands on throughput, such as sensors and monitoring, were the first services to be built on NB-IoT technology. Data traffic generated by such devices is generally low; the typical data packet for a sensor-based service is about 100–150 bytes, with a payload comprised of a device ID, time stamp and reported data values. NB-IoT technology is capable of supporting data rates of 227Kbps in uplink and 250Kbps in downlink.
Cat-M1 is a second technology designed and standardized for massive IoT applications and is capable of supporting data rates up to 1Mbps in both the uplink and downlink.
The traffic volume generated by massive IoT applications is a function of message size, message interval and number of devices deployed per square kilometer.
Beyond massive deployments of devices generating limited data volumes, there is an evolving range of IoT applications that have stringent requirements on availability, delay and reliability. Applications include traffic safety, automated vehicles, drones and industrial automation. These can generate many times more data traffic than massive IoT applications, depending on the specific use case. They could be based on LTE devices where, for example, an LTE Cat 4 device supports data rates of 150Mbps in downlink and 50Mbps in uplink; or have use case requirements that only future 5G network capabilities can meet. NB-IoT and Cat-M1 will continue to coexist with the introduction of 5G networks.
The diagram below illustrates that, as new enabling IoT technologies are deployed, both the number of connections and the traffic per connection over cellular networks will drive increasing traffic volumes.
1 GSA (October 2018)
2 These figures are also included in the figures for wide-area IoT