China will drive accelerated growth for cellular IoT in 2018, says Berg Insight

Tobias Ryberg of Berg Insight

A new report from the IoT market research firm Berg Insight estimates that the global number of cellular IoT subscribers increased by 56% during 2017 to reach 647.5 million. The accelerating growth is expected to take the global installed base to almost 1 billion at the end of 2018. By 2022, Berg Insight now projects that there will be 2.7 billion IoT devices connected to cellular networks worldwide.

“China is playing a key role in accelerating and transforming the global cellular IoT market”, said Tobias Ryberg, senior analyst and author of the report. “The Chinese government has set a goal to connect 600 million devices to NB-IoT networks by 2020.

NB-IoT will essentially replace 2G technology, which accounted for the bulk of the 150 million new cellular IoT connections added in the country in 2017. In the process, the cost of 4G-based cellular IoT chipsets and modules will fall dramatically, paving the way for a similar transition worldwide”. The report concludes that the developments will ultimately make 2G networks obsolete as different flavours of 4G will meet all cellular IoT use cases at lower cost and better performance.

The next wave of cellular IoT adoption is focused on new vertical segments like smart cities and infrastructure, smart industrial supply chains and connected consumer products. Berg Insight believes the new wave will start in China, where government authorities and manufacturing companies will be first in the world to deploy connected devices using NB-IoT technology on a massive scale.

In the same way, embedded cellular IoT connectivity will be added to a wide number of consumer product categories. “The remarkable rise of the bike sharing industry illustrates how fast new technology can scale in the Chinese consumer market. In less than a year, tens of millions of connected bikes were launched into the streets of major cities”, said Mr Ryberg.

“The aftermath of the bike sharing frenzy does however underline an equally important point: IoT technology adds no value without a proper business case. The long-term winners in IoT will be those who combine scale and economic benefit.”

Download report brochure here.

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