State of IoT 2023 Report Interpretation: WiFi / Bluetooth / Cellular connectivity, LPWAN convergence Trend Highlights, and Satellite IoT Accelerates Development

Recently, market research firm IoT Analytics released a report on the Internet of Things market summary  in 2022 and future forecasts, providing insights on multiple aspects of the Internet of Things, and this paper will extract the core information.

According to the report, thenumber of global IoT connections has grown by 18% to 14.3 billion in 2022 and is projected to grow by 16% in 2023 to reach 16 billion.This 16% growth, or nearly 2.3 billion new IoT devices, will be the source of growth for the IoT industry in the coming months.

Three types of connectivity technologies account for 80% of the share

Although there are many connectvities behind the Internet of Things, after years of development, it is still a small number of technologies that form large-scale applications. According to IoTAnalytics, three key technologies dominate global IoT connectivity, namely WiFi, Bluetooth and cellular, which account for nearly 80% of IoT connections.

First, let’s look at the WiFi situation. According to IoTAnalytics, WiFi accounts for 31% of all IoT connections. WiFi technologies and devices are also evolving, with more than half of the world’s WiFi devices in 2022 based on the latest WiFi 6 and WiFi6E technologies. These technologies are expected to enable faster and more reliable wireless connections, and their continued application in appropriate scenarios improves communication efficiency between IoT devices, improving user experience and overall performance. Across all IoT scenarios, WiFi technology is leading IoT connectivity in smart homes, smart buildings and healthcare.

Bluetooth technology has grown to become the second largest market for IoT connectivity, with IoT Analytics data showing that 27% of IoT connections worldwide rely on Bluetooth. Bluetooth Low Energy has been evolving to reduce the energy consumption of devices while maintaining reliable connectivity. Bluetooth Low Energy has become the preferred choice for battery-powered IoT devices such as smart home sensors, BLE gateway and asset tracking devices (BLE AOA locator). Even IO-Link wireless technology in the industrial sector is showing increasing interest in Bluetooth, allowing wireless communication between the microphone / actuator and I / O host.

WiFi and Bluetooth transmission distances are relatively short, and cellular IoT accounts for the highest proportion of long-distance IoT connectivity technologies. IoT Analytics data shows that cellular IoT (including 2G, 3G, 4G, 5G, LTE-M and NB-IoT) now accounts for nearly 20% of global IoT connections, with global cellular IoT connections growing by 27% year-on-year in 2022, significantly exceeding the growth rate of global IoT connections. This growth has been driven by the massive adoption of technologies such as LTE-M, NB-IoT, LTE Cat 1 and LTECat1bis, which, of course, is backed by the backdrop of global delisting of 4G and 3G. IoT Analytics mentions that while 5G module shipments grew more than 100% year-on-year in 2022, the growth rate was still lower than many expected.

The cellular Internet of things has shown a very obvious head effect, with the top five operators-China Mobile, China Telecom, China Unicom, Vodafone and AT&T managing 84 per cent of the world’s cellular Internet of things connections, according to IoT Analytics. In terms of Internet of things revenue, the top five operators account for 64 per cent of cellular Internet of things revenue, namely, China Mobile, AT&T, Germany Telecom, China Unicom and Verizon.

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The future performance of different IoT connection technologies is clearly differentiated

From the IoT Analytics data, it can be seen that in the past 2021-2022, the growth rate of different connectivity technologies varies greatly. Among them, 5G-based IoT connectivity has the fastest growth, reaching a growth rate of 200%; This was followed by the Low Power Wide Area Internet of Things (LPWAN), with a growth rate of 38%; Next is the cellular IoT in addition to 5G and LPWAN, with a growth rate of 22%. The author believes that this field is mainly driven by LTE Cat 1 and LTE Cat 1 bis; Wireless Local Area Network achieved a 21% growth rate, which is mainly dominated by WiFi.

IoT Analytics predicts that between 2022-2027, 5G based IoT growth rate is still far ahead, with an annual compound growth rate of 87%; Next is LPWAN, with a growth rate of 27%; The growth rate of cellular IoT in addition to 5G and LPWAN fell to 8%; Wireless local area networks and wireless personal area networks represented by WiFi and bluetooth can guarantee a compound annual growth rate of 16%.

It can be seen that in the next few years, the proportion of long-distance IoT connections will continue to grow. Among them, due to the small 5G base and the continuous acceleration of 5G applications in the next few years, 5G-based application scenarios will not expand, becoming one of the most active areas of the global Internet of Things industry, especially under the promotion of RedCap commercialization, 5G-based Internet of Things connectivity will accelerate in the next few years; LPWAN is still one of the main force of the Internet of Things, in the context of the current development of various technologies of the Internet of Things, it is expected that the corresponding technology will not appear in the next few years to replace the market position of NB-IoT and LoRa; As RedCap continues to fall in commercial and cost, alternatives to LTE Cat 1 and LTE Cat 1 bis are emerging.

First, the trend of convergence of various technologies in the low-power wide-area Internet of Things is obvious.

LPWAN will remain a hot topic in the coming years. In the past year, two major M & A events in the LPWAN sector have moved the sector away from technological competition to convergence: the UnaBiz acquisition of Sigfox and the Semtech purchase of Sierra Wireless.

After the acquisition of Sigfox, UnaBiz cooperated extensively with LoRaWAN and cellular networks. Driving the convergence of different connected technologies means that UnaBiz has become not just a technology provider, but a solutions provider. It also bundles all the different technologies together and coordinates them on its own software platform.

In addition, Semtech itself is the owner of LoRa Technology, and its acquisition of Sierra Wireless is once the global leader in cellular IoT modules and platforms, and Semtech’s next important work is to promote the deep integration of LoRa and cellular IoT platforms.

The second is to accelerate the application of low altitude satellite Internet of things

IoT Analytics also lists “other” connectivity technologies, of which the Internet of Things for low altitude satellites is a typical example.

As the scale of IoT grows, so does the need for ubiquitous connectivity. Low altitude satellites provide a very effective way to connect previously unconnected ground networks. This technology is particularly useful in the agriculture, maritime and logistics industries. Low altitude satellites are closer to Earth than conventional satellites, reducing latency and increasing data transmission speed, which is essential for real-time data processing.In IoT Analytics, this type of connection is more resilient and reliable, ensuring consistent communication even in challenging environments or in the event of natural disasters.

The number of satellite IoT connections is expected to grow from 6 million to 22 million between 2022 and 2027, at a compound annual growth rate of 25%, according to IoT Analytics. Although 22 million connections have a smaller impact on the overall market, some companies are beginning to integrate satellite connections into chips, It will also significantly accelerate the application of satellite IoT, such as Qualcomm’s cooperation with satellite operator Iridium to provide satellite emergency information services for smartphones equipped with Snapdragon chips; In addition, Sony Semiconductor has released the first low-power cellular IoT chip, ALT1350, which provides satellite connectivity, opening up new possibilities for IoT devices to communicate beyond the boundaries of traditional networks. This integration of satellite connectivity into LPWA chips is expected to drive further innovation and growth in the satellite IoT market. Of course, in my view, satellite IoT is still a complement to terrestrial IoT connectivity and can play a role in some verticals, but will not replace the existing cellular IoT market.

IoT Analytics also surveyed a large number of companies and found that despite some macro uncertainties, the IoT market will remain largely intact in the second half of 2023, with positive sentiment dominating the market.