Utility sector remains largest market for cellular IoT modules

The utility sector comprises the largest end market in terms of the number of installed cellular IoT modules, according to a new report released by Berg Insight.

This is owing to the progression of smart metering projects, even though programmes are being deployed at a reduced installation pace at times.

Factory closings by major automotive OEMs and weaker demand for passenger cars due to COVID-19 will have a negative impact on the global cellular IoT modules market in 2020, according to the report.

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Cellular IoT module sales for automotive applications will decline in 2020.

Despite challenges in the short term, Berg Insight predicts the current situation will accelerate the digitalisation trend in the coming years and the adoption of cellular IoT modules will accelerate.

The 3GPP specifications for low power wide area communications – LTE-M and NB-IoT – will contribute to grow substantially in the next five years.

Although 5G coverage is improving rapidly across developed markets, 5G IoT modules will not be available commercially in significant volumes until the second half of 2020.

Global cellular IoT module shipments increased by 22% in 2019 to a new record level of 265 million.

However, despite the new record, annual revenues grew slower at 7% due to increased price pressure and a higher share of low-cost LPWA modules in the product mix.

The five largest module vendors have 71% of the market in terms of revenues.

Fredrik Stalbrand, a senior IoT analyst with Berg Insight, said: “Annual module revenues for the five largest players Quectel, Sierra Wireless, Thales, Sunsea AIoT and Telit increased by 5% to $2.2 billion, with the total market value reaching approximately $3.1 billion.

“Enterprises that have started their digital transformation journey are already at an advantage and today provide immense value for customers through remote management of processes, using connected devices to avoid unnecessary human contact.”