Global cellular IoT market reaches USD $15 billion in 2023

The global cellular Internet of Things (IoT) connectivity market achieved a notable milestone in 2023, with mobile operators worldwide earning a combined revenue of USD $15 billion from 3.6 billion cellular IoT connections, according to IoT Analytics. This marked a significant year-over-year growth rate of 23%, surpassing the revenue growth of IoT software companies and hyperscalers during the same period.

IoT Analytics reported that the top five mobile IoT network operators managed 83% of all global cellular IoT connections, while the top five operators by revenue accounted for 64% of the combined revenue in 2023. These insights were derived from IoT Analytics' Global Cellular IoT Connectivity Tracker & Forecast and the IoT Mobile Operator Pricing & Market Report 2024-2030.

Looking forward, the introduction of 5G and 5G Reduced Capability (RedCap) technologies is expected to further drive the growth of the global cellular IoT market. The market is forecasted to expand at a compound annual growth rate (CAGR) of 18% between 2024 and 2030 due to advancements in these technologies.

Satyajit Sinha, Principal Analyst at IoT Analytics, commented on the transformative potential of 5G RedCap. "5G RedCap is set to transform the IoT landscape by making 5G features more accessible and supporting numerous applications, from industrial IoT to Consumer IoT," he stated. "Its design optimisations, such as reduced channel bandwidth and capped modulation order, enhance device efficiency and cost-effectiveness. Riding on existing 5G infrastructure, RedCap ensures the longevity of current deployments and eases the transition to next-generation connectivity."

Despite the growth in cellular IoT connections, IoT Analytics noted that global shipments and revenue for cellular IoT modules experienced a decline in 2023. However, the overall expansion in IoT connectivity highlights the growing reliance on cellular networks for various IoT applications, from smart cities to industrial automation.

Sinha further elaborated on the benefits of 5G RedCap over existing technologies, saying, “It outperforms LTE Cat-1 and Cat-4, with better uplink performance and extended battery life, meeting the critical needs of mid-speed use cases like wearables and smart cameras.”

The insights into the cellular IoT market highlight significant trends and growth areas poised to shape the industry over the next several years. With the impending advancements in 5G technologies, mobile operators and technology providers are likely to see continued expansion and increased demand for IoT solutions.