For years the cellular and Wifi standards peacefully co-existed with different uses (voice vs data) and different technological strengths (see, Convergence and Competition – A Tale of Two Standards Part 1 (the Early Years: Peaceful Co-Existence) (sepessentials.com)). But over time, the technologies used in the standards, and the applications for which the standards are used, have converged (see, Convergence and Competition – A Tale of Two Standards Part 2 (Convergence of Functionality – the Middle Years). We have now reached the current generation of sharp elbows and frenemies where companies jockey to support their favored standard (typically cellular), often at the expensive of the disfavored standard (usually WiFi):[1]
the traditional boundaries that differentiated earlier generations of cellular and Wi-Fi are blurring. Proponents of one technology may argue for the benefits of their chosen technology displacing the other, requesting regulatory policies that would serve to tilt the marketplace in their favour.[2]
So what has changed to make WiFi and cellular coexistence no longer peaceful? The smartphone market has become saturated and growth has slowed. At the same time, IoT is emerging as the next big wave of devices needing connectivity.
Depending on who is estimating, the value of the IoT device market is expected to grow from USD 596 billion in 2023 to over USD 4 trillion by 2032, e.g. in less than a decade.[3] The number of connected IoT devices is expected to grow from about 16 billion to 37 billion in that same period of time.[4] Although each report seems to have somewhat different numbers, they each predict a CAGR (compound annual growth rate) of nearly 25% in the IoT market.
Compare that to the more mature smart phone market where the 2023 market value estimate is just a tad under the estimate for IoT devices at USD 539 billion in 2023 but the expected value in 2032 is much less than that for IoT devices at only USD 876 billion.[5] Again, each report has somewhat different numbers but both reflect an anticipated CAGR of only 7-8% per year in the smart phone market over that period.
IoT (think smart meters, connected sensors, connected appliances, credit card terminals, handheld inventory management systems) does not require the same connectivity bells and whistles as smart phones. Most IoT devices send occasional bursts of small volumes of data over short distances. For example, a smart meter transmits a fraction of the data that browsing the internet or downloading a single movie on your cell phone takes.[6]
IoT devices also often rely on battery power with no (or very infrequent) recharging so power consumption is often an important consideration. In addition, many IoT devices need to be inexpensive to be successful. For all of these reasons and many others, IoT devices usually only implement a single connection technology. This means that cellular SEP licensors and developers are now competing with WiFi SEP licensors and developers for who will most successfully capture the rapidly growing IoT device market.
Consequently, you can think of this as a tale of two standards competing with each other, and with other standards, to win the hearts and minds and most importantly the dollars of the IoT device market.
[1] In the old days, one of the important differences between the standards was that cellular operated in the licensed band and WiFi in the unlicensed band. In recent days, however, cellular has moved into the unlicensed band which has caused the standards to start competing for bandwidth and radio space. A University of Chicago experiment showed that WiFi performance deteriorated when cellular devices used the off-license portion of the spectrum previously used only for WiFi. The study also found that, because of technological differences, this deterioration was significantly more pronounced on the WiFi side than on the cellular side. “This competition was particularly detrimental to Wi-Fi. When LAA [licensed assisted access, e.g. when cellular networks use a mode that operates on the same bands as WiFi] was also in active use, data transmitted by Wi-Fi users decreased up to 97%. Conversely, LAA data only exhibited a 35% decrease when Wi-FI was also in use.” More cell phone data use is negatively affecting Wi-Fi performance, study finds | University of Chicago News (uchicago.edu). In other words, these days cellular even has the capability to knock WiFi off line.
[2] See Revisiting Wireless Internet Connectivity: 5G vs Wi-Fi 6 - ScienceDirect. See also, WiFi vs Cellular: Which is Better for IoT? (verytechnology.com).
[3] Internet of Things [IoT] Market Size, Share, Growth, Trends, 2032 (fortunebusinessinsights.com).
[5] Smart Phone Market Revenue To Be US$ 876 Bn in 2032 | Asia Pacific Dominates with 39% of the Market Share (yahoo.com) and Smartphone Market 2024-2032 | Report Size, Share and Trends (marketresearchfuture.com)
[6] Smart meters, for example, generally transmit data for a total of less than 1 minute per day. Common Questions about Smart Meters | EWEB