Ericsson has released its latest Mobility Report (formerly the Mobility Index), finding that while Cellular IoT connections will reach 5bn units in 2025, some 1bn of those are going to be legacy 2G and 3G links, with around 1.4bn being 4G and 5G. The Massive IoT section, which includes LTE-M and NB-IoT, is counted separately from the 4G part, and will constitute around 2.6bn units in 2025 (52% of all C-IoT). This puts non-cellular IoT devices on around 400m units, by Ericsson’s count.
Even in 2025, the number of deployed legacy (2G/3G) devices is still forecast to sit at one billion units. Given the MNO desire to refarm valuable spectrum for LTE and 5G, 1bn Cellular-IoT devices still stuck on 2G and 3G may be a concern, though in many cases, MNOs will keep just a small sliver of spectrum to support legacy machine-to-machine applications, repurposing the rest for newer networks.
By Ericsson’s predictions, the legacy category will grow slightly in 2023 before sitting at a flat billion for 2024 and 2025. This means that this industry will still be deploying new devices up to 2024, despite talk about 2G and 3G sunsets. Of course, some markets have already sunset legacy networks, especially in east Asia, while in Europe, the trend is likely to be to switch off 3G within a few years, but to keep a small amount of 2G capacity almost indefinitely for IoT.
Put another way, for every legacy device Ericsson expects in 2025, there are 2.5 Licensed-LPWAN devices. Even in 2025, legacy devices will make up 20% of the total Cellular IoT portfolio, with L-LPWAN on 52%, and the remaining 28% on full-fat LTE and 5G connections. By this measure, there are only going to be 1.8 L-LPWAN devices (low cost, low power, long battery life) for each blazing fast LTE IoT device.
The report itself doesn’t dive into any great detail on the IoT side of things. Ericsson argues that LTE-M and NB-IoT are complimentary, and that of the 114 MNOs that have launched at least one of them, around 25% are supporting both.
North east Asia (China, Japan, South Korea) accounts for 60% of the global total for Cellular IoT in 2019, and will grow to 68% of the market in 2025. Ericsson says this reflects both the ambition and size of the C-IoT market in that region.
Given what we know of Japan and South Korea’s scale, this would suggest that Chinese Cellular-IoT will account for around 58% of the global market in 2025, with the bulk of that being NB-IoT. As this technology is being heavily backed by the Chinese government, it seems most of that 58% share would be NB-IoT. This leaves the remaining 42% to be divided between the rest of the world and between LTE-M and NB-IoT. If the rest of that 42% were split exactly in half, that would give LTE-M a 21% share of the global L-LPWAN market in 2025, though we suspect that NB-IoT devices will prove more popular in the rest of the world, meaning that LTE-M’s actual share would be lower.
Broadband IoT is defined as offering higher throughput, lower latency and larger data volumes than Massive IoT’s but there is no further detail on what proportion of that sector is comprised of LTE Cat 1 – the stripped-down version of LTE Cat 3.
Critical IoT is defined both wide area and local area use cases that require extremely low latency and ultra-high reliability. Ericsson says that the first such modules will appear in 2020, but that in 2025, Critical IoT will constitute only a small fraction of total connections.
As for other areas of the Mobility Report, Ericsson says there are now 6.2bn mobile broadband subscriptions, up 61m in the quarter. It says that 52% of the total mobile broadband subscriptions are LTE, and that 13m 5G subscriptions are expected to be live by the end of 2019. In 2025, Ericsson believes that 5G number will stand at 2.6bn, with 8bn total mobile broadband subs – around 90% of the total mobile subscriptions. Some 70% of today’s subs are smartphones, but this is expected to reach 83% by 2025. By the end of the period, there will still be around 300m 2G and 3G subs, down from around 1.5bn in 2019.
In the Network Coverage section, Ericsson says that global 4G population coverage is at 75%, and will reach 90% by 2025. To date, 311 of the 777 commercial 4G networks are LTE-Advanced (Cat 4 and above), and 36 are Gigabit LTE (Cat 16 and Cat 18). There are around 50 commercial 5G networks, according to the report. Ericsson believes 5G will be deployed faster than any other mobile communications technology. It expects 5G population coverage to grow from less than 1% today to between 55% and 65% in 2025.