Cellular IoT Gateway Market Still Growing – Berg Insight

Despite the advent of IoT-optimized 4G/LTE networks and the imminent deployment of 5G networks, the market for cellular IoT gateways is still growing, according to IoT market research specialist Berg Insight.

Cellular IoT gateways are a staple of machine-to-machine (M2M) communications, and have long been used to bring cellular connectivity to remote locations. The gateways use cellular technology to connect one or many IoT devices (such as remote ATMs or oil pipelines) to a wide-area data network, and can be used as a primary connection, or as backup to a landline connection.

Although these gateways first emerged during the rollout of 2G and 3G networks, Berg Insight's CEO and principal analyst, Johan Fagerberg, tells Light Reading that now, close to 70% of cellular IoT gateways sold include 4G/LTE connectivity.

And while IoT-specific 4G/LTE networks based on the Cat M and NB-IoT specifications are being rolled out, there's still increasing demand for gateways that are needed to connect large items such as heavy industrial machinery, buses and other items that would not house a Cat M or NB-IoT chip.

According to Berg, more than 3.4 million cellular IoT gateways were shipped globally in 2018, representing a market value of $921 million, but the market is set to more than double by 2023, when Berg expects more than 8 million cellular IoT gateways to be shipped. Berg Insight says its numbers account for "standalone devices intended for connecting machines to a cellular network," and include "general-purpose cellular gateways, routers and modems that are enclosed in a chassis and have at least one input/output port," but do not include trackers or telematics devices.

"Cradlepoint, Cisco, Sierra Wireless, CalAmp and Digi International are the largest vendors worldwide," says Fagerberg in an email, adding that he expects these companies to continue to dominate the market in 2020. Combined, those five vendors generated almost $500 million in cellular IoT gateway sales in 2018, accounting for a market share of 53.3%.

The gateways can offer 4G LTE, NB-IoT and Cat M connectivity in a single unit, but don't always offer all those options. Cat M gateways started shipping in 2018, but those supporting NB-IoT have so far been limited, Fagerberg says. "Early adopters are taking a cautious stance amid the network rollouts, citing needs for reliability before committing to volume," the CEO explains.

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— Dan Jones, Mobile Editor, Light Reading

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