The report, which was released today, predicts that by 2018 IoT connections – such as connected cars, machines, remote monitoring devices, and consumer electronics – will surpass smartphone connections. By 2021, the report estimates, there will be 28 billion connected devices, 16 billion of which will be IoT related. In North America alone, Ericsson expects there will be around 3 billion IoT connected devices by 2021.
Ericsson’s current predictions are not that much different than the infrastructure vendor’s IoT estimates in a similar report last fall. At that time, Ericsson predicted there will be 26 billion connected devices by 2020.
The report adds that new use cases will drive much of this growth and that IoT connections will increase at a compound annual growth rate of 23 percent from 2015 to 2021.
Currently, there are about 400 million IoT devices that are connected via cellular networks, according to Ericsson. Not surprisingly, the company is predicting that cellular-connected devices will have the highest growth rate because of increased focus on 3GPP standardized cellular IoT technologies.
Cellular technologies, such as LTE-M, NB-LTE-M, and MB-IoT, are based on the 3GPP specification. These standards are essentially cellular networking optimized for IoT devices, which makes them a natural fit for cellular providers.
Many of Ericsson’s biggest customers are cellular carriers, including Verizon Wireless and AT&T. The report notes that 70 percent of today’s IoT modules use GSM, while about 5 percent use LTE. But more IoT devices are expected to migrate to LTE as the cost of LTE modules declines.
Interestingly, Ericsson’s report said that Europe will have the most growth in IoT connections, primarily because of the connected car segment.
Ericsson’s “Mobility Report” also reiterated its previous estimate that there will be 150 million 5G subscribers globally by 2021. The company first revealed that statistic in its December 2015 report. It also said that 95 percent of mobile subscriptions in North America will be LTE/5G by 2021.
The company said it expects standardized 5G networks to be commercially available in 2020, but “pre-standard” networks will likely launch before that in select markets. Verizon has widely said that it will pilot 5G in a fixed mobile environment by 2017.
Not surprisingly, Ericsson also said that U.S., Japan, China, and South Korea will be the first to launch 5G.