IoT MVNO Market

Market Overview

The global IoT MVNO market size was valued at USD 3.1 billion in 2023 and is projected to reach a value of USD 15.7 billion by 2032, registering a CAGR of 19.7% during the forecast period (2024-2032). Network coverage, service quality, pricing competitiveness, and the capacity to provide customized solutions geared to specific IoT applications and industry verticals are all variables that affect IoT MVNO Market share.

An IoT MVNO, or Internet of Things Mobile Virtual Network Operator, is a telecommunications service company that focuses on providing connectivity solutions for IoT (Internet of Things) devices. Unlike regular MVNOs, which primarily offer mobile voice and data services to consumers and companies, IoT MVNOs cater to the specific needs of IoT applications.

The global IoT MVNO market is expanding rapidly, driven by the expansion of Internet of Things (IoT) devices across industries and the growing demand for specialized connection solutions. IoT MVNOs are essential in providing specialized connectivity services for IoT applications by providing scalable solutions that support various devices and use cases. These MVNOs differentiate themselves by emphasizing network coverage, service quality, pricing competitiveness, and the capacity to provide customized solutions. With technological developments and the expansion of IoT ecosystems, the worldwide IoT MVNO market will likely grow further as businesses and organizations seek dependable, secure, and cost-effective connectivity solutions for their IoT installations.

Highlights

• The reseller generates the highest revenue share using the operational model.
• Enterprise dominates the market by subscribers.
• Large Enterprise accounts for the largest share of the market by enterprise size.
• Business influences market growth through business models.

Market Dynamics

Global IoT MVNO Market Drivers:

Rapid Growth of IoT Devices

The development of Internet of Things (IoT) devices in various industries, including smart cities, healthcare, manufacturing, and agriculture, is increasing the demand for specialized connectivity solutions from IoT MVNOs. According to Ericsson's 2022 mobility report, there were 13.2 billion IoT-connected devices at the end of 2022, with the figure predicted to rise to 34.7 billion by 2028. The paper also estimates that in 2028, 28.7 billion devices will link to local short-range low-power wide-area networks (LPWANs), while 6 billion will connect to wide-area networks, including private cellular networks. Various factors drive this rise, including the increased adoption of IoT applications in smart cities, healthcare, agriculture, and industrial automation.

Additionally, in smart cities, IoT devices are utilized for smart lighting, traffic management, trash management, and environmental monitoring. For example, cities use IoT devices to monitor air quality, identify noise pollution, and control energy use. These IoT devices demand dependable connection solutions from IoT MVNOs to send real-time data and enable smart city projects. The IMD Smart City Index ranks Singapore as the world's smartest city. Singapore's Smart Nation plan, established by Prime Minister Lee Hsien Loong in 2014, has incorporated numerous smart technologies in the public and private sectors. The city created Virtual Singapore, a virtual model that updates in real-time to assist in discovering patterns and testing solutions to problems.

Similarly, IoT devices are utilized in the healthcare sector for remote patient monitoring, telemedicine, medical asset tracking, and prescription management. With the increased usage of IoT-enabled healthcare solutions, there is a greater need for safe and dependable connection services provided by IoT MVNOs to ensure seamless communication between medical devices, patients, and healthcare professionals.

Global IoT MVNO Market Restraints:

Security Concerns

With the expansion of IoT devices, security issues such as data breaches, malware attacks, and unauthorized access are becoming increasingly prevalent. Security flaws in IoT devices and networks might weaken faith in IoT MVNO connection solutions, discouraging businesses and organizations from adopting IoT technology. Cyber attackers are increasingly targeting IoT devices in 2023, with a 400% increase in attacks compared to 2022. In the first two months of 2023, the average number of weekly assaults per business on IoT devices grew by 41% compared to 2022. IoT malware attacks increased by 37% in the first six months of 2023, totaling 77.9 million, up from 57 million in the same period in 2022.

Additionally, European firms are the most likely to use IoT devices, followed by APAC and Latin American organizations. Vulnerable IoT devices will become a significant threat vector, exposing businesses to breaches and new security threats. Manufacturing will remain a prominent target for IoT assaults. IoT and IoMT devices routinely used in healthcare settings will bring increased threats to the public. Similarly, According to IDC, 90% of firms face DNS assaults, which cost $1.1 million, emphasizing the essential need for resolving security risks in IoT deployments.

Thus, security concerns are a substantial limitation on the worldwide IoT MVNO market, affecting trust, acceptance, and investment in IoT solutions. To address these concerns, effective security solutions, such as secure connectivity provided by IoT MVNOs, are required to protect IoT devices, networks, and data from cyber threats and vulnerabilities. Failure to address security issues may stifle the IoT market's growth and potential, undermining the benefits of IoT technology for enterprises, consumers, and society.

Global IoT MVNO Market Opportunity:

Advancements in Wireless Communication Technologies

5G networks are expected to assist various industries, particularly the Internet of Things (IoT) and artificial intelligence (AI) applications that require real-time data transfers. More broadly, the introduction of 5G will likely coincide with rising data use worldwide, with predictions predicting mobile data traffic of about 330 exabytes per month by 2028, more than three times the volume consumed in 2022.

Additionally, advancements in wireless communication technologies, such as 5G, low-power wide-area networks (LPWAN), and satellite connection, open new prospects for IoT MVNOs to provide creative solutions for growing IOT applications. These technologies offer faster data rates, reduced latency, better coverage, and greater dependability, opening up new opportunities for IoT deployments in fields such as driverless vehicles, smart grids, industrial automation, and augmented reality. According to a Juniper Research report, 5G IoT (Internet of Things) connections would reach 116 million worldwide by 2026, up from 17 million in 2023. In 2023, 5G roamers climbed from 68 million in 2022 to 176 million, indicating that the industry is gaining momentum.

Furthermore, LPWAN is a fundamental technology fueling the global Internet of Things movement. It offers cost-effective, energy-efficient, and dependable connections for various applications. By integrating these technologies, IoT MVNOs may provide innovative connectivity solutions that meet changing consumer needs and generate new revenue streams across different business verticals. Partnerships and collaborations with technology suppliers, network operators, and ecosystem partners can also expedite the acceptance and implementation of IoT solutions powered by sophisticated wireless technologies, resulting in growth and distinction in the global IoT MVNO market.

Regional Analysis

Europe Dominates the Global Market

The global IoT MVNO market analysis is conducted in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

Europe is the most significant global IoT MVNO market shareholder and is estimated to grow at a CAGR of 19.4% over the forecast period. Europe is expected to have the largest IoT Mobile Virtual Network Operator market share due to increased mobile penetration and IoT device usage. For example, the MVNO Europe association promotes the interests of MVNOs operating in the European mobile and Internet of Things (IoT) markets, which have negotiated wholesale access to host MNO networks. This organization intends to make the market more accessible to all virtual mobile carriers, resulting in rapid expansion and a significant surge in the mobile communication sector. Most European countries have delivered commercial 5G services, with roughly two-thirds of operators launching 5G networks based on spontaneous adoption rates. 

North America is anticipated to exhibit a CAGR of 19.8% over the forecast period. North America is expected to become the second-largest region in terms of market share in the worldwide market. This market presence is linked to the headquarters of MVNO vendors such as Verizon Communications Inc., Comcast Corporation, DISH Network Corporation, and T-Mobile US Inc., among others, as well as significant expenditures in cloud applications. These elements help to drive regional market growth. Mobile networks are essential to economic recovery and digital change in the North American region. For example, in 2021, the United States Congress approved a measure for telecom infrastructure worth USD 65 billion in public financing to increase 5G connectivity and broadband access. In addition, the Canadian government has launched the Universal Broadband Fund, which would promote high-speed internet projects in developing countries with USD 2.1 billion.

Asia-Pacific holds a significant market share. The rising adoption of mobile devices and other technical features, such as 5G, strengthens the foundation for MVNO services in the Asia-Pacific. Companies in the automobile industry, such as Audi, which has 5G-connected cars, and the logistics industry are collaborating with network operators to deliver direct-to-consumer communication services, particularly in rural areas where traditional telecommunications does not reach. These players see communication services as a business opportunity.

Additionally, Asia has the world's highest proportion of internet users, at 57.9%. However, over 1 billion people remain offline in China and India alone. According to the World Bank, 70% of the East Asia Pacific region's population has access to online services, while only 49% has mobile internet connectivity. However, this figure is predicted to increase to over two-thirds by 2030. The region's unique mobile subscriber penetration rate, excluding Greater China, was 62% in 2022 and is expected to rise to 71% by 2030. This increased penetration will help to drive future market growth. 

Latin American countries have made significant regulatory changes, opening up great opportunities for local and global service providers to launch new services, acquire large industry verticals, and earn regional revenue. Furthermore, communications regulators have steadily removed easy-to-access hurdles for virtual network operators. South America's mobile market is predicted to have approximately 75% more mobile internet users than in the previous decade. Furthermore, the gray mobile has a strong presence in the SA market (19.6%), trailing only Africa (21.3%), and government officials, in collaboration with device manufacturers, are making significant efforts to combat such firms that impede regional market growth. 

The Middle East and Africa look to be the fastest-growing regional markets, with the greatest CAGR, indicating enormous market potential. MVNO licensing in the Middle East and Africa would benefit customers and network providers. Furthermore, investors look for possibilities in consumer behavior to adopt MVNOs as soon as possible. For example, telecommunications authorities in two key markets issued five new licenses in the GCC region during the pandemic. 

Segmental Analysis

The global IoT MVNO market is segmented based on operation, subscribers, enterprise size, and business model.

The market is further segmented by operation model into Reseller, Service Operator, and Full MVNO.

In the reseller model, the IoT MVNO bridges the network infrastructure provider (a mobile network operator) and the end user. The MVNO obtains bulk connectivity services from the network operator at wholesale prices, which it then resells to clients under its brand. A reseller either operates under its brand or co-brands with an MNO. It is responsible for branding, sales, and distribution expenses. It also shares revenue with the MNO. Alternatively, the service provider does not own the radio frequency infrastructure itself. However, it retains customer service and billing platforms. In this operational paradigm, the virtual network operator can deploy a cellular card and set rates separate from those set by the MNO. The MNO is responsible for the costs connected with IT platforms and wholesale access fee structures. 

The full MVNO model is the most advanced level of MVNO integration, with the MVNO managing its core network infrastructure, including switching, routing, and subscriber management systems. Full MVNOs have complete control over network operations, service delivery, and customer administration, allowing them to provide a wide range of services independent of the network operator. 

However, they do not have ownership of the radio access network infrastructure. It oversees operations, data, and consumers and controls the mobile operator's market services and products. Many resellers and service providers' mobile operators grow their companies to become complete MVNOs, generating more revenue and income.

Based on subscribers, the market is categorized into Consumer and enterprise.

The enterprise segment includes enterprises, organizations, and government agencies that use IoT devices for commercial, industrial, or institutional purposes. Asset tracking, fleet management, remote monitoring, predictive maintenance, smart agriculture, and industrial automation are among the industries and use cases in which enterprise IoT is deployed. Enterprise IoT MVNOs serve the specific connectivity needs of enterprises and organizations, providing scalable, dependable, and secure connectivity solutions that enable mission-critical IoT applications. 

Individuals or families who use IoT devices for personal or residential purposes fall under the consumer group. These IoT devices could include smart home appliances, wearables, home security systems, and connected entertainment devices. Consumer IoT MVNOs provide connectivity solutions targeted to individual consumers' needs, focusing on price, ease of use, and consumer-friendly features. 

The market can be further bifurcated by enterprise size into Large, Small, and Medium-Sized Enterprises.

Large enterprises have enormous resources, comprehensive operations, and a sizable number of personnel. These organizations frequently have complicated IoT requirements and deploy diverse IoT devices and applications across numerous locations and business units. Asset tracking, supply chain management, logistics optimization, smart manufacturing, and facility management are all examples of large-scale enterprise IoT installations. IoT MVNOs aimed at large companies provide scalable, configurable connectivity solutions to enable high-volume, mission-critical IoT applications. These solutions could include dedicated connectivity, managed services, service-level agreements (SLAs), and interface with company IT systems.

Small and medium-sized firms (SMEs) have fewer personnel and resources than giant corporations. SMEs cover various industries and verticals, including retail, healthcare, hospitality, professional services, and manufacturing. While SMEs may have smaller IoT deployments than major companies, they still want dependable, cost-effective connectivity solutions to support their business operations.

Based on the Business Model, the market is fragmented into Discount, Specialist Data, Ethnic, Business, International/Roaming, Youth/Media, and Bundled.

Business IoT MVNOs focus solely on business customers, providing connectivity solutions targeted to the unique demands and requirements of businesses, government agencies, and other organizations. These MVNOs specialize in offering dependable, scalable, and configurable connectivity services that serve mission-critical IoT applications, business operations, and digital transformation efforts.

Specialist data IoT MVNOs provide connection solutions for specific data-intensive IoT applications or industry verticals. These MVNOs specialize in offering high-speed, high-volume data connectivity for applications such as video streaming, remote monitoring, data analytics, and industrial automation, catering to customers with specific data needs.

Recent Developments

• February 2024- KDDI and Sony Honda Mobility began collaborating to drive connected businesses globally.
• January 2024- Melon Mobile announced a collaboration with SourseAI to add further AI-powered capabilities to its fully digital MVNO.