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The Chinese government has set ambitious connectivity targets for 2020 as the demand for cellular Internet of Things (IoT) continues to increase. Statistics released by Internet of Things market research firm M2M claim that the global number of cellular Internet of Things subscribers increased by a whopping 56% in 2017, which was driven predominantly by demand in China.

China is seen as the mecca for technological innovation and both the government authorities and manufacturing companies will be the first in the world to deploy connected devices using NB-IoT technology on such a widespread scale.

Some analysts have projected that the acceleration of growth in the cellular Internet of Things sector will take the global installed base to almost 1 billion by the end of 2018, whilst Berg Insight has estimated that by 2022 there will be around 2.7 billion IoT devices connected to cellular networks on a global basis. The next wave of cellular IoT adoption is focused on new vertical segments like smart cities and infrastructure, smart industrial supply chains and connected consumer products.

Senior Analyst and author of the report conducted into the increase in demand for cellular Internet of Things, Tobias Ryberg has suggested that China will continue to play a key and leading factor in the acceleration, demand and growth of cellular IoT.

He said, “China is playing a key role in accelerating and transforming the global cellular IoT market. The Chinese government has set a goal to connect 600 million devices to NB-IoT networks by 2020. NB-IoT will essentially replace 2G technology, which accounted for the bulk of the 150 million new cellular IoT connections added in the country in 2017. In the process, the cost of 4G-based cellular IoT chipsets and modules will fall dramatically, paving the way for a similar transition worldwide.”

The report concludes that the developments will ultimately make 2G networks obsolete as different flavors of 4G will meet all cellular IoT use cases at lower cost and better performance.

“The remarkable rise of the bike-sharing industry illustrates how fast new technology can scale in the Chinese consumer market. In less than a year, tens of millions of connected bikes were launched into the streets of major cities”, added Ryberg.

“The aftermath of the bike-sharing frenzy does however underline an equally important point: IoT technology adds no value without a proper business case. The long-term winners in IoT will be those who combine scale and economic benefit.”