What IoT Manufacturers Need to Know

It is difficult to decide when to adopt new technology. Moving too soon and evolving infrastructure could limit your markets. Stick with older networks and functionality could suffer. The question is: When should IoT manufacturers adopt 5G New Radio (NR) standards? And the answer is: It depends on your device’s technical requirements. Let’s take a look at what today’s IoT manufacturers need to know about 5G NR standards as they relate to product development timelines. 

An Overview of 5G NR Standards

The first thing to know about NR is that it won’t displace existing machine-type communication (MTC) cellular standards any time soon. Massive MTC (mMTC) connections work quite well on 5G, and for now, the entire 5G mMTC space operates on LTE-M and NB-IoT.

In other words, 5G is not an alternative name for NR. In the mMTC space, 5G is based on the LTE-M and NB-IoT waveform. These massive IoT standards support low data rates, with NB-IoT generally delivering data at a rate of about 100 kilobits per second (kbps); and with LTE-M delivering hundreds of kbps, roughly 1000 kbps or 1 Mbps (megabits per second).

For data rates in this range, we can expect to see LTE-M and NB-IoT supporting MTC requirements  at least through 2030, and probably a good deal longer. So what’s the point of NR standards? 

Essentially, as per the original design and purpose, the NR waveform and numerology support higher data rates, measured in the tens or hundreds of Mbps. These very high rates support a great many IoT use cases, including smartwatches, headsets, telematics, smart home devices, and even high-data devices like mobile routers, IoT gateways, and other IoT aggregators.

“Essentially, as per the original design and purpose, the NR waveform and numerology support higher data rates, measured in the tens or hundreds of Mbps.”

-Sequans

The 5G NR standards discussed below are developed and maintained by the 3rd Generation Partnership Project (3GPP), and specifically their working committees dedicated to radio access networks. As of this writing, 3GPP has been working on two NR standards for cellular IoT:

1. NR Reduced Capability (RedCap): NR RedCap is a 5G NR standard for radio access that targets data rates of a few hundred Mbps. This is about the same data range currently covered by LTE Cat 4 and Cat 6 standards, so we can expect RedCap to take over for devices that currently connect via LTE Cat 4 or Cat 6.    
2. NR Enhanced Reduced Capability (eRedCap): While 3GPP’s Release 18 is still under development, its initial definition introduced an NR standard that fits within the current LTE Cat 1/Cat 1bis data rate range. Enhanced RedCap, or eRedCap, supports use cases that use a few Mbps, for example, many consumer IoT devices with audio or video capability.

Depending on your device’s use case, RedCap or eRedCap may offer stronger performance on 5G networks than current LTE standards, and it is naturally future-proof—and the question of when to switch to NR should depend entirely on your use case and development timeline.

The Business Case for IoT with 5G NR

Before you can decide when to start implementing RedCap technology, you must look at your product’s business case. In other words, what does your product do? Take three imaginary companies, for example: 

#1: Company A

Company A builds battery-operated smart meters for global markets. The product’s lifespan is dictated by battery life, which is about 20 years. With very low data requirements and government clients, the benefits of 5G NR probably don’t yet outweigh the current costs or deployment limitations. This company is better off sticking with a dual-mode LTE-M and NB-IoT solution that covers all their local markets.

#2: Company B

Company B makes smart home panels and sells them in multiple nations. The most important connectivity factor for these products is reliability, but company leadership also wants to simplify inventory with a single SKU and keep its cost per unit lower than what they have today.

In terms of network availability, some nations offer only LTE-M; others offer only NB-IoT; and some offer both. Since NB-IoT cannot support the data rate necessary for smart home panels that require at least LTE-M speed, this company probably isn’t ready for 5G NR yet either, both because of cost, and worldwide network availability. They’re better off with the globally available Cat 1 or Cat 1bis for the next 10 years or so. 

#3: Company C

Company C creates consumer electronics. Their brand image is tech-forward and future-focused, and the company doesn’t have a lot of cost or timeline constraints. This is an ideal use case for 5G RedCap or eRedCap (depending on the actual data rate needs) because it leverages the excitement over 5G—but only if the 5G products can be released in 2026 or later. 

And speaking of 2026, that’s probably the year we’ll start to see the 5G NR transition becoming commonplace. Let’s talk more about the projected timeline, with the caveat that no one knows how quickly technology will advance. These are just our best guesses. 

The 5G Transition Timeline: An Educated Guess

Based on 3GPP reports and the current cellular landscape in 2023, it seems likely that cellular IoT will start moving massively toward 5G NR standards in 2026 or 2027. RedCap should become commonplace about a year prior, so start looking for competitors to implement RedCap in 2025 or 2026.

That would not prevent early deployment from taking place in 2023 or 2024 in limited geographies, and with a high per-unit price which would still prevent massive adoption.

You don’t have to commit to RedCap or eRedCap as the technology landscape shifts. Most early adopters of 5G NR standards will start by including dual-mode connectivity in their products.

Chipsets featuring iSIM connectivity will probably support Cat 1 or Cat 1bis alongside NR eRedCap, for instance. That way, devices can choose the connection standard that offers the best performance, no matter where the device travels. This flexibility bridges the gap between old networks and the new paradigm, and that’s good news indeed. 

Looking even a bit further down the road, one could anticipate that eRedCap will further evolve into something that we could call feRedCap (further enhanced RedCap) that would be an NR equivalent to the existing LTE-M and NB-IoT.

That may be done in the context of 5G or the coming 6G, replacing the existing waveform and numerology designed for 4G, and ensuring longevity in constantly evolving networks. We explain what it would take to get cost and power-optimized dedicated 5G NR solutions for massive IoT in this white paper.