What are the key growth indicators for cellular IoT and the challenges standing in the way? This IDC infobrief identifies key growth indicators, examines challenges and opportunities for cellular IoT connectivity management.
We surveyed companies in 3 major countries which included: the United States, United Kingdom, and Germany.
We surveyed companies of all sizes. From those with 100 employees up to 5000 employees.
We surveyed across multiple industries: Healthcare, Manufacturing, Government, Retail/wholesale, Utilities, and Transportation
Cellular IoT is often thought of as the connectivity of choice for IoT devices on the move. According to respondents, however, 75% of their cellular connected IoT devices were stationary in nature, demonstrating that cellular is beneficial for both stationary or mobile devices.
The top three use cases across verticals are:
The top three use cases across verticals are:
The top three use cases across verticals are:
While organizations see value across a variety of IoT solutions, the top three verticals are:
The average size of cellular connected device fleet deployments is 1,700 devices across
all company sizes; for large companies, the average is 6,300 devices.
of organizations manage device fleets of 100 or more devices
of organizations plan to launch additional connected products and solutions
into the market over the next 12 months.
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Organizations want the ability to select which radio technology (i.e., 2G/3G, 4G, 5G) their devices connect to and are highly concerned with the possibility of their devices being steered to networks with incompatible radio technologies, resulting in service disruption.
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Organizations are especially concerned with limited access to Tier 1 networks via one SIM, network quality degradation when devices are in motion, as well as poor troubleshooting capabilities and no failover options during network outages.
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of respondents are using 5G for their cellular IoT projects
The majority of respondents are currently using 4G for their cellular IoT deployments.
4G is expected to maintain strong prevalence in the market due to its broad applicability across use cases and the sunset of 2/3G networks.
MONTHS
MONTHS
Lack of visibility into domestic and global device deployments and usage
The top three challenges that slow projects considerably and hinder project success for cellular IoT solution are:
Ordering and shipping SIMs and modules in a timely manner
The top three challenges that slow projects considerably and hinder project success for cellular IoT solution are:
Inability to try SIMs during evaluation
The top three challenges that slow projects considerably and hinder project success for cellular IoT solution are:
65% of organizations report paying for overages and unused data
Data costs and pricing models are top concerns for organizations:
65% of organizations report paying for overages and unused data
Pooled pricing is the dominant pricing model, often with overages baked in
Data costs and pricing models are top concerns for organizations:
Pooled pricing is the dominant pricing model, often with overages baked in
The #1 issue reported with carrier management is keeping costs under control
Data costs and pricing models are top concerns for organizations:
The #1 issue reported with carrier management is keeping costs under control
of respondents with domestic-only deployments have multiple mobile carriers
of respondents with international deployments have multiple mobile carriers
For organizations with multiple domestic mobile operators, the top challenge is multiple bills to reconcile, normalize and pay
For organizations with multiple global mobile operators, the top challenge is overage fees
The top five areas where organizations are struggling:
High cost of integration into backend systems
(development/third-party costs)
Lack of developer tools, resources and support
Limited or poor quality APIs, API uptime and helper libraries
Lack of debugging capabilities or M2M SMS APIs when data service is unavailable
Lack of open-source software development kits
(development/third-party costs)
Ability to choose networks to control cost, coverage and compatible radio technology (i.e., 2G/3G, 4G, 5G), while using one SIM
Developer tools as well as API availability and quality for integrating and automating operations
One bill that consolidates multiple carriers’ bills as well as flexibility in pricing option (i.e., pay-as-you go, pooled data)
A single pane of glass from which to view all devices
Self-serve ordering and fast shipping and delivery of SIMs
The needs of IoT use cases vary a lot. Some critical IoT use cases that require a near real-time response need high-speed connectivity; for other use cases where devices will not be replaced for many years, preserving battery life is most important.
Coverage and network reliability is key for delivering a highly available cellular IoT solution, which explains why more than half of the deployments (both domestic and international)use multiple carriers.
Managing cost has emerged as a top concern for organizations regardless of use case, deployment location and device fleet size.
Given most projects take a long time to get off the ground, organizations are looking for technologies that are easier to deploy in order to speed time to value.
Today, it is no longer necessary to manage multiple contracts with multiple carriers and multiple SIMs to get comprehensive domestic or global coverage. By accessing multiple carriers through a single SIM, organizations can streamline their entire product operations and avoid the pains of building multiple product SKUs, managing multiple support processes, and long supply chain timelines.
In addition to geographic coverage, network reliability is of the utmost importance to successful IoT deployments. Therefore, companies should also consider the quality of networks they can access, the failover options available and how much control they will have over the networks their devices connect through. And given that it takes an average of 12 months to deliver a proof of concept, organizations should also consider SIMs that enable them to future-proof their business, as their network selections (for radio technology and geographic coverage) may not meet their evolving needs one year down the line.
Organizations with IoT devices deployed across multiple mobile networks are often dealing with multiple portals to get visibility into their device fleets. As the device fleet grows, however, this approach becomes increasingly unmanageable. Instead, organizations should look for providers that can offer a single pane of glass view, deeper network insights and easier management over their entire fleet of devices (and across carriers).
Automation through software is a growing trend across the technology landscape as it allows organizations to create more efficiency in their business processes. Companies should assess the degree to which an IoT connectivity solution will help them automate their customer-facing and internal operations. The quality and documentation of the APIs should be assessed, as the automation strategy is only as good as the software supporting it. A “try before you buy” option is useful in this regard.
As with any technology investment, organizations should closely evaluate the total cost of ownership of the IoT connectivity solution. Every deployment carries cost in terms of the connectivity service itself. But, it is critical to evaluate the costs that cover other areas such as fleet management, integration, opportunity cost of time to market, deployment testing effort, and issue resolution time. It’s important to especially focus on the costs that impact the ability to scale and ensure a superior customer experience over the lifetime of the project. Beyond TCO, other metrics to consider evaluating include ROI, time to market, productivity increases, operational efficiencies, and improved customer satisfaction scores.
