LATAM Cellular IoT Market, 2022-2030

IoT Connectivity Is Experiencing Transformational Growth Due to Technological Advances in 5G and LPWAN Connectivity

This study explores the cellular IoT connectivity market in Latin America (LATAM). It focuses on cellular connections, which link cell towers to IoT devices, and examines licensed access connectivity protocols, including 5G, 4G, 3G, 2G, NB-IoT, and LTE-M. The cellular IoT market drives significant growth opportunities across various sectors for both consumer and enterprise applications. It supports a wide range of use cases, from low-complexity deployments with minimal data transmission to high-throughput, low-latency devices, as well as latency-sensitive applications such as edge computing. In LATAM, Brazil leads in IoT technological advancements, but how do other countries precisely fit into this dynamic landscape? While this study primarily takes a regional perspective, it also highlights the current status of key national markets: Argentina, Brazil, Chile, Colombia, and Mexico. This study provides a comprehensive overview of the LATAM cellular IoT industry, including key drivers and restraints, significant market trends, growth opportunities, and other essential insights.

Scope of Analysis

• This study presents the cellular IoT connectivity market in Latin America (LATAM), showcasing its key drivers and restraints, the most significant market trends, and growth opportunities.
• For this analysis, a cellular IoT connection is defined as a unique SIM card that transmits data over the cellular network from and to an IoT device.
• The IoT industry encompasses 4 major divisions: hardware, network connectivity, applications, and platforms. The focus of this study is network connectivity, specifically in cellular connections, which are those that connect a cell tower to an IoT device through licensed access connectivity protocols: 5G, 4G, 3G, 2G, 4G LPWAN (comprehending NB-IoT, and LTE-M), and 5G RedCap.
• The geographic region covered is LATAM, with a focus on Argentina, Brazil, Chile, Colombia, and Mexico.
• The quantitative objectives of this study are to determine an accurate market size for 2024, segmented by country, connectivity protocol, client type, and network type, and to forecast the market's growth for the next 6 years, segmented by the groups already mentioned.
• To measure the 2024 industry size and forecast for the next 6 years, the study is based on the number of enterprise IoT subscriptions and revenue, which was calculated in US dollars ($).
• Growth Generator Analysis of Connectivity Protocols does not include segmentation by region.

The Impact of the Top 3 Strategic Imperatives on the Cellular IoT Industry

Innovative Business Models

• Why: In LATAM, IoT implementations for the corporate segment is moving beyond the nascent stage. This growth has boosted the accessibility of IoT technologies for start-ups and SMEs. As a result, the number of industry verticals adopting IoT solutions multiplied, creating different and unique IoT demands. For CSPs, this is an opportunity to create new revenue models around new services in industry sectors such as healthcare, manufacturing, and logistics.
• Frost Perspective: To adjust to each vertical need with greater efficiency, security, and reliability, these new models must tailor to client connectivity needs, considering that the increase of connected devices drives growth in data volume. This shift requires sophisticated analysis means and technological innovations. In the next 5 to 10 years, LATAM is expected to see merging business models that include GenAI as a service (GaaS), data monetization, Data as a service (DaaS), personalized IoT platforms, GenAI-powered IoT protocols, and GenAI-enhanced analytics.

Transformative Megatrends

• Why: In a highly competitive and regulated environment, CSPs must stay current with market trends to deliver high-quality services despite delays in 5G auctions and deployments. Key topics in the corporate sector include sustainability, cybersecurity, and AI adoption. However, LATAM's IoT offerings lag. Many IoT projects are not yet utilizing AI and data management capabilities, missing out on the potential ROI that AI could deliver.
• Frost Perspective: In the rest of the world, AI-powered IoT systems are paving the way for data-driven outcomes and automation. Iot LATAM providers should begin incorporating AI software in services, products, and solutions to address future demand. As IoT and AI algorithms keep evolving, CSP, cloud, and infrastructure vendors should leverage this innovation to provide customized services that can adapt to the needs of users and customer continuous evolution over time.

Disruptive Technologies

• Why: Beyond offering competitively priced mobile data plans and covering the latest concerns and demands, vendors should be aware of technological advances that can change product quality and end-user experience. Software-based SIMs, such as integrated SIM (iSIM) and embedded SIM (eSIM), make it easier to activate and manage IoT connections. LPWAN technologies, such as LTE-M, NB-IoT, and 5G RedCap, are also unlocking new use cases.
• Frost Perspective: LATAM is expected to see a progressive shutdown of 2G and 3G networks, leaving most IoT devices connected through 4G and LPWAN networks. These are the technologies expected to increase the volume of cellular IoT connections. However, for mission-critical applications, IoT devices will connect using 5G. Providers should be prepared to commercially launch eSIM and iSIM and LPWAN technologies such as 5RedCap, along with 5G connectivity, to ensure an offering based on flexibility, lower costs, interoperability, and scalability.

Key Competitors

• Argentina
  • Claro Argentina
  • Movistar Argentina
  • Personal Argentina
• Brazil
  • Claro Brasil
  • Vivo
  • TIM Brazil
  • Oi
• Chile
  • Entel Chile
  • Movistar Chile
  • Entel Chile
  • WOM Chile
• Colombia
  • Claro Colombia
  • Telefonica Colombia
  • Tigo Colombia
  • WOM Colombia
• Mexico
  • Telcel Mexico
  • Movistar Mexico
  • AT&T Mexico
• Rest of LATAM
  • Movistar Peru
  • Claro Peru
  • Bitel
  • Conecel S.A.
  • Otecel
  • Altice Dominicana
  • Others

Competitive Environment

• Number of Competitors
  • 20+ with revenue greater than $812.21 million in 2024
• Competitive Factors
  • Cost, performance, reliability, flexibility, ecosystem relationships, innovative business models, product innovation in new IoT connectivity solutions
• Key End-User Industry Verticals
  • Agriculture, logistics, manufacturing, security, smart cities, healthcare, oil and gas, retail
• Leading Competitors
  • Claro Argentina, Claro Brasil, Claro VTR, Claro Colombia, Telcel, Movistar Argentina, VIVO, Movistar Chile, Movistar Colombia, Movistar Mexico, Personal Argentina, TIM Brasil, Oi, Tigo Colombia, WOM
• Revenue Share of Top 4 Connectivity Protocols (2024)
  • 95.6% (between NB-IoT, 4G LTE, 2G, and 3G)
• Other Notable Competitors
  • Tigo, Oi, AT&T, American Tower do Brasil, Embratel, WOM
• Distribution Structure
  • IoT hardware vendors, regulation organizations, CSPs, IoT app providers, system integrators

Growth Drivers

• Technological breakthroughs enabling IoT: The continuous rollouts of LPWAN, eSim, AI, and edge computing are paving the way to connectivity expansion for large-scale IoT deployments, reducing IoT implementation costs and complexity.
• Spread of IoT devices: The demand for IoT devices in tracking, automation, and logistics is growing in the corporate sector. IoT applications, such as smart homes and wearables in the consumer sector, are at different growth stages, depending on the country. The variety of needs addressed by connected devices highlights the innovation in IoT technology during the last decade, and the LATAM market is now benefitting.
• Data-driven insights: IoT devices emit data because of their usage. Companies are starting to acknowledge the value of the information emitted for predictive maintenance, customized customer experience, and operational optimizations. This is boosting demand for stronger IoT connectivity services.
• Regulatory initiatives: Regulatory entities such as 3GPP and national governments are taking responsibility and promoting IoT use through the emission of regulatory digital initiatives. During the last two years, several national LATAM governments launched national digital agendas to promote the adoption of 5G, LPWAN, and NTN technologies for IoT applications.

Growth Restraints

• Developing connectivity infrastructure: The development of 5G for IoT is still slow across LATAM. Issues include infrastructure buildout and smaller business sizes, partly caused by economic instability and slow investments in 5G and IoT infrastructure, especially in Argentina, Colombia, and Venezuela.
• Vendor complexity: Integrating IoT solutions such as connectivity and cybersecurity for businesses requires service from separate vendors. The lack of standardized protocols leads to complex integration processes that act as restraints from the demand side.
• Decreasing ARPU: The commoditization of cellular IoT connectivity services pricing is eroding ARPU. Countries have 3 major operators, on average, that have similar offerings and data prices.
• Permanent roaming restrictions: These restrictive regulations are an operational burden for vendors deploying IoT solutions in LATAM. While technologies such as eSIMs and multi-IMSI SIMs offer solutions, they add complexity to device management, and the diverse regulatory landscape of the region remains a significant challenge.