Approval of NB-IoT and LTE-M as standards later this year will help LPWA adoption growth.
Low power wide area (LPWA) IoT M2M networks are poised for an exponential global growth of 4200% over the next five years, driven by applications that use very small amounts of data.
According to analyst firm Pyramid Research, LPWA M2M connections will grow from 20m to over 860m between 2015 and 2020.
This contrasts with a growth of 130% of cellular M2M connections from 310m to 715m, proving that LPWA network connections are shaping up to be ‘the’ IoT network standard to connect large amounts of devices.
Low cost, low power and broad coverage networks have been designed to be faster than conventional cellular networks and offer a larger territorial coverage than cellular, short-range wireless and other connectivity options.
LPWA also consumes less power and running costs are often lower than cellular and other M2M connectivity technologies, according to Pyramid Research.
The company said the LPWA market’s key players of the moment are SIGFOX, LoRa and RPMA, “each of which enjoys different advantages and disadvantages in terms of capability, industry support, business model, degree of coverage and level of adoption”.
The emergence of new LPWA standards, such as LTE-M (Long Term Evolution for machine-type communications) and NB-IoT (NarrowBand IoT), set to be approved by the 3rd Generation Partnership Project (3GPP) this year, will also drive market adoption as most operators are waiting for the standards body to approve such technologies.
By 2017, Western Europe is predicted to become the leading LPWA market in terms of connections, taking over from North America which is today leading this space, “largely because of the adoption of random phase multiple access (RPMA) devices in predominantly private networks”.
However, the Asia-Pacific region is set to overtake the two regions and own 46% of the market by 2020.
Elsewhere, the research company has also found that deployment of LPWA networks is expected to be much slower in developing markets, where the focus on M2M overall is much more limited.
Africa and the Middle East, Central and Eastern Europe, and Latin America are expected to account for just 14% of LPWA global connections in 2020.
In terms of applications, smart meters will account for the largest market share (45%) of LPWA connections by 2020.
Industrial and financial applications will be the second largest, and in five years time, analysts expect consumer electronics to become the third largest, with very high growth rates around 2020.
Smart cities, especially intelligent lighting, parking and smart buildings, are forecast to account for 12% of total LPWA connections by the end of the decade. Yet, the adoption of LPWA in land vehicle-based applications is expected to be limited.
Looking at the convergence of cellular and wireless technologies, such as LPWA, Robin Duke-Woolley, CEO at IoT and M2M analyst firm Beecham Research, said that new wireless solutions are substantially complementary to cellular rather than competitive with it.
“While many IoT applications are well covered by traditional cellular connectivity, Wifi or Bluetooth, the growth in applications that use very small amounts of data is driving the rapid introduction of LPWA technologies.”
“However the continuing focus on connectivity technologies is not helpful for the rapid market development and there needs to be more emphasis on service attributes so that users can match their IoT applications to the right pubic connectivity services.”
According to Olivier Pauzet, VP for market strategy at wireless communications company Sierra Wireless:
“[In the end,] interoperability and scalability will be critical success factors for the growth of the Internet of Things and M2M. Open standard technologies are needed in order to overcome fragmentation and integration issues.”
According to IDC, the worldwide IoT market will grow from $655.8bn in 2014 to $1.7tr in 2020 with a compound annual growth rate (CAGR) of 16.9%.