Cellular IoT Market Report

Cellular IoT Market Analysis By Component (Hardware, Software), By Type (2G, 3G, 4G, LTE-M, NB-LTE-M, NB-IoT, 5G), By End-use, By Region, And Segment Forecasts, 2014 - 2025

Published: August 2017  |  145 Pages  |  Format: PDF  |  Report ID: GVR-1-68038-578-6

Industry Insights

The global cellular IoT market size was valued at USD 1,788.5 million in 2016 and is expected to gain traction over the forecast period. Factors such as resilient networks, ubiquitous mobility, and robust security are the key functionalities driving growth in the cellular IoT market. In addition, the need to connect high density, low-power, and low-cost devices at an economical scale is expected to aid in the increasing demand for IoT platforms across different verticals.

A number of solutions that utilize broadband connections for machine-to-machine data transmission have been deployed in the market, with the LTE technology forming its communication backbone. As a result, advancements in “massive adoption” of LTE and technological innovations in the IoT ecosystem are considered as the key factors for the growing IoT demand over cellular networks. In addition to this, the ability to operate with local connectivity and networking technologies, such as Wi-Fi and Bluetooth, are likely to have a profound effect on these solutions’ capability to address a diverse set of IoT use cases.

U.S. cellular IoT market, by type, 2014 - 2025 (USD Million)

U.S. cellular IoT market

Emerging applications, such as automotive connectivity, fleet management, healthcare device connectivity, and wearables, are expected to drive the growth of cellular networks. In addition, they find uses in a host of other applications, including smart metering, weather monitoring systems, personnel traffic pattern monitoring, infrastructure security systems, flood management, and agricultural management among others.

Various industry players spread across the value chain are initiating and actively supporting the growing penetration of cellular technology as the dominant connectivity standard. These initiatives have been generating considerable interest in industry stakeholders, including chipset and module manufacturers, infrastructure providers, carriers, as well as IoT solution vendors. These collaborations have been the most important factor in the rapid and widespread adoption of broadband technology in the IoT ecosystem.

Factors such as fragmentation and strong competition from LPWAN technologies, such as LoRA and SigFox, may limit the market growth for some years; however, numerous efforts taken to standardize the industry and eminent emerging venues for cellular IoT are expected to help the technology thrive in the coming years.  

Component Insights

The hardware segment holds a major share in the overall cellular IoT market, which can be attributed to the large number of devices that are deployed. In addition, the cellular technology is more effective in addressing IoT use cases which have massive deployments of sensors and nodes and can be easily augmented with local network connections. The hardware segment accounted for more than 65% of the overall market in 2016. 

The software segment has further been divided into device management and signal processing wherein the device management sub-segment is expected to gain traction over the forecast period. As the network infrastructure for cellular connections is already in place and would require a software update for new LTE bands to be deployed, the signal processing segment is anticipated to grow at a steady rate in the coming years. The software segment is expected to grow at an impressive CAGR of 23.3% over the forecast period.

Type Insights

The market has been segmented based on technologies into 2G, 3G, 4G, LTE-M, NB-LTE-M, NB-IoT, and 5G. Among these, 2G held the largest market share in terms of revenue in 2016 as it caters to low-cost certifications and modem options and has largest number of users across the globe. However, 2G is expected to lose ground in the near future as standards and technologies for machine-to-machine and IoT connections are evolving quickly and offering advanced and efficient cellular services.

Technologies such as LTE-M, NB-LTE-M, and NB-IoT are expected to be commercialized by the end of 2017, and are expected to grow at a rapid rate in industrial applications. NB-LTE-M is anticipated to grow at a CAGR of 42.3% over the forecast period owing to its expected large-scale adoption in industrial machine-to-machine communication. On the other hand, 5G technology is yet to be defined but is anticipated to grow the fastest as it will cater to a host of different applications and offer a high bandwidth for high-speed applications.

End-use Insights

The adoption of cellular technologies is expected to gain traction in applications that require massive deployments and high-density end-point connections, owing to which industries such as energy, utilities, and manufacturing are expected to benefit the most from it. The energy sector held the largest market share of 21.0% in 2016 and is expected to grow in the coming years. 

The need to leverage new technologies such as IoT, cloud, and big data more efficiently, cost-effective use of sensor networks and underlying infrastructure is necessary which can be materialized with the help of cellular machine-to-machine connectivity. Owing to these advantages, the technology has been witnessing a growing demand in smart cities applications. This application is anticipated to witness a high growth rate of 23.8% over the forecast period.

Asia Pacific cellular IoT market by component, 2016 (%)

Asia Pacific cellular IoT market

Regional Insights

The North American region is expected to lead the market in terms of revenue as solution vendors and component manufacturers are aggressively pursuing IoT implementation projects. Some crucial factors in the region’s growth are the rapidly changing technology landscape and ability of industries to adopt smart and connected products at their inception. The region is anticipated to grow at a CAGR of 18.8% and reach USD 3.28 billion by 2025.

The European region, too, is predicted to generate considerable revenue and witness a healthy growth over the forecast period. Cellular connectivity in IoT applications ensures massive deployments in sectors such as fleet tracking and management capillary networks and smart buildings, owing to which the application is expected to witness highest growth in the Asia Pacific region. The ever-increasing population, high demand for consumer goods, and recent proliferation of the disruptive technology in industrial applications are the major factors driving market growth over the forecast period.  

Competitive Insights

Prominent players in the market include Qualcomm Inc., Sierra Wireless, ZTE Corporation, Gemalto NV, Commsolid GmbH, Mistbase Communication System, MediaTek Inc., Sequans Communications, Texas Instruments, and Telit Communications PLC, among others.

The prime factor in the industry is the different initiatives undertaken by key market players so as to standardize and increase the adoption of cellular IoT in novel applications. Numerous industry coalitions and working bodies have also been formed to aid the widespread adoption of these machine-to-machine technologies, especially NB-IoT, LTE-M, and 5G. An interesting phenomenon in the market is the participation of industry stakeholders from component manufacturers to service providers to promote these technologies.

Report Scope

Attribute

Details

Base year for estimation

2016

Actual estimates/Historical data

2014 - 2015

Forecast period

2017 - 2025

Market representation

Revenue in USD Million & CAGR from 2017 to 2025

Regional scope

North America, Europe, Asia Pacific, Latin America, and MEA

Country scope

U.S., Canada, UK, Germany, China, India, Japan, and Brazil

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

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Segments Covered in the Report

The report forecasts revenue growth at global, regional, and country levels and provides an analysis of industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global cellular IoT market based on components, types, end uses, and regions:

  • Component Scope (Revenue, USD Million; 2014 - 2025)

    • Hardware

    • Software

      • Device Management

      • Signal Processing

  • Type Scope (Revenue, USD Million; 2014 - 2025)

    • 2G

    • 3G

    • 4G

    • LTE-M

    • NB-LTE-M

    • NB-IoT

    • 5G

  • End-use Scope (Revenue, USD Million; 2014 - 2025)

    • Agriculture

    • Automotive & Transportation

    • Consumer Electronics

    • Energy

    • Environment Monitoring

    • Healthcare

    • Retail

    • Smart Cities

    • Others

  • Regional Outlook (Revenue, USD Million; 2014 - 2025)

    • North America

      • U.S.

      • Canada

    • Europe

      • UK

      • Germany

    • Asia Pacific

      • China

      • India

      • Japan

    • Latin America

      • Brazil

    • Middle East & Africa (MEA)

Key questions answered by the report
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