IoT Connectivity Is Still A Tough Sell
TelecomTV, Friday, July 21,2023
The business case for IoT connectivity services has always been a tough one for telcos, made even harder by the fact that such services are strategically important because they are highly valued by enterprise customers. Berg Insight, a company that has for many years specialised in IoT market research, has just reminded us how tough the IoT business case is for mobile operators.
At the end of 2022 there were 2.7 billion cellular IoT connections worldwide that generated revenues of about 10.8bn Euros, up by 24% year on year, according to the team at Berg Insight, which estimates there will be 5.3 billion IoT devices connected to mobile networks, generating total annual revenues of 21.4bn Euros, by 2027.
So the market is growing in terms of connections and overall revenues as more and more enterprises use IoT devices in their operations.
But it isn't moving the needle much financially, because those connections don't generate much in the way of revenues - in 2022, the average revenue per user per IoT connection was 0.38 Euros per month, down slightly on the previous year, according to Berg Insight's calculations.