By 2026, Cellular IoT Devices Will Hit a Global Total of 5.7 Billion, Creating a Connectivity Conundrum for Carriers

At the end of 2020, 6.6 billion Internet of Things (IoT) devices will be connected and active worldwide; 840 million of them will use cellular networks, which is just under 8% of the total. At the end of 2014, there were 180 million cellular IoT devices active worldwide, and that number increased by over 4.5X in the six intervening years. In another six years’ time, there will be a further near-7X growth in cellular IoT devices, bringing the global total to 5.7 billion, finds global tech market advisory firm, ABI Research. This explosive growth means carriers are facing more specific and diverse demands for guarantees from IoT customers, especially when roaming.

“More smart devices are being deployed, and more types of devices are becoming smart,” says Jamie Moss, M2M, IoT & IoE Research Director at ABI Research. “It is clear the ability to connect diverse IoT device types, with different needs, at massive scale, and with global coverage is needed now. Next-gen Connectivity Management Platforms (CMPs) and global connectivity coverage solutions are key to accomplishing this task.”

Enterprises want a one-stop-shop, more so now than ever. Large multinational corporations that can afford to employ systems integrators to assemble customized systems are few, and while they were some of the earliest IoT adopters, they only represent a portion of the market. Most enterprises do not have the funds or inclination and may not even know what the IoT can do for them. Instead, they value specialist expertise that can deploy and host services for them that “just work,” leaving the enterprise itself to focus on what it does best—its existing business. “Next-generation CMPs, such as floLIVE, can provide international connectivity for enterprises by allowing carriers to become International Mobile Virtual Network Operators (MVNOs). The core network of a CMP vendor can collectively manage the routing of IoT traffic across many carrier customers’ RANs, allowing them to sell international IoT services with the guarantee of a single price point for data and a consistent QoS,” Moss explains.

Next-generation CMP capabilities build on the essential features of traditional systems by adding options that solve problems on the business side, not just the technical side. Roaming agreements are replaced with local connectivity, reducing risk thanks to partners having done this work for the carrier. This means faster time-to-market, fewer carrier resources consumed, carrier access to extra resources, and no large CAPEX investment, just OPEX.

“Carriers need more than just a platform to manage connectivity, they also need a third party to provide them with global managed connectivity as a service to secure roaming. Only then can carriers become effective IoT players domestically and internationally,” Moss concludes.

These findings are from ABI Research’s Tomorrow’s Smart Connected Products Require Smarter Connectivity Services Today whitepaper.  This whitepaper is part of the company’s M2M, IoT & IoE research service, which includes research, data, and ABI Insights.