The number of cellular IoT connections in the retail industry reached 147.9 million worldwide in 2023, according to a new research report from Berg Insight.

Cellular IoT technology enables devices such as POS terminals, ATMs, digital signs and ticketing machines to be used at new locations where fixed line connectivity is unavailable or impractical.

The technology has a more transformational effect on markets such as vending and parking, where machine operators need to reorganize their operations in order to benefit from the availability of real-time information.

Berg Insight forecasts that the number of cellular IoT connections in the global retail industry will grow at a compound annual growth rate (CAGR) of 10.0 percent during the next five years to reach 217.7 million connections in 2028.

Shipments of cellular IoT devices for retail applications will at the same time increase at a CAGR of 6.2 percent from 57.9 million units in 2023 to 78.2 million units in 2028.

POS terminals constitute the largest device segment and accounted for 93 percent of all cellular IoT connections in the retail industry at the end of 2023. The market for wirelessly connected POS terminals is however relatively mature, and most of the market growth is driven by the increasing use of electronic payments in emerging markets.

“The multi-space parking meter segment was an early adopter of cellular IoT connectivity and has today reached the highest connectivity penetration of 70 percent”, said Felix Linderum, IoT Analyst at Berg Insight.

Cellular connectivity has also found its way into the single-space parking meters market, which has become one of the fastest growing segments.

Berg Insight expects that the vending machine segment will present a major opportunity for wireless connectivity in the long term. Today only 6.5 million of the world’s 14.8 million vending machines are online, but it is inevitable that every vending machine will eventually be connected.

“Costs for equipment as well as connectivity services have come down significantly and the solutions have become more sophisticated and easier to deploy. However, the organisational change needed to get the maximum benefits from vending telemetry is probably the largest remaining barrier to widespread adoption”, continued Mr. Linderum.

In digital signage, cellular communications is expected to remain a niche connectivity option mainly due to the higher costs associated with the technology.

Mr. Linderum concluded:

“However, a growing number of media players now come with SIM slots and cellular technologies such as 5G are likely to become more relevant to meet the demands for broadband data required from applications such as 3D, AI and analytics.”

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