With the continuous evolution and development of cellular IoT network technology, the era of Internet of Everything is coming.  5G RedCap (Reduced Capability), as a key evolution direction of cellular IoT technology, is an important puzzle for 5G to realize low-, medium -, and high-speed full-scenario IoT. It will move towards large-scale commercial use in 2023 and start the 5G IoT "billion" journey.

Look at the scenario: RedCap has a wide range of application scenarios, and the demand for 5G native capabilities drives the first wave of application deployment

In June 2022, the 3GPP R17 protocol standard was frozen, and 5G RedCap technology was defined for medium and high-speed IoT scenarios.  By simplifying the number of terminal antennas and transmitting and receiving bandwidth, RedCap can greatly reduce the costminal of 5G . At the same time, it inherits 5G native capabilities such as large capacity, low latency, high reliability, and network slicing, and achieves the best balance between performance and cost.  There are three main types of RedCap application scenarios:

Video surveillance: In urban management, industrial and agricultural scenarios, there is a need for real-time video surveillance to deal with security risks and enrich management methods. By integrating 5G  terminal modules with surveillance cameras, it provides and-and easily-to low-cost backhaul method for video surveillance.

Wearable devices: Wearable devices mainly include smart watches, smart bracelets, medical monitoring equipment, etc., and generally require devices to be small in size and low in power consumption.

Industrial wireless sensors: There are a large number of data collection requirements in the industrial field, including pressure sensors, temperature and humidity sensors, etc., which have high requirements for end-to-end service delay and availability.

In addition to the above three scenarios, in-vehicle T-Box, power equipment, home broadband entry-level CPE, etc. will also become important scenarios for RedCap's future applications.

In the industry field, 5G native capabilities such as large bandwidth, low latency, high reliability, and network slicing are often just needed by the industry. RedCap, as a lightweight 5G technology, can significantly reduce the end-side of 5G for industry while ensuring that the functional performance meets industry needs. Therefore, industry applications such as industry, electric power, and park video surveillance will become the first wave of application markets for RedCap.

In the consumer field, high-definition cameras for personal security scenarios have certain requirements for bandwidth. RedCap cameras can make full use of the advantages of 5G's large capacity and reduce bit costs. It is expected to become the standard configuration of wireless video surveillance in the future. Applications such as Internet of Vehicles and smart wearables will gradually adopt RedCap to replace the original 4G IoT technology as module costs decrease.

Look at the space: RedCap achieves one million connections in the first year of commercial use, and breaks through the new blue ocean of billion-level Internet of Things in the next three years

In 2022, for the first time in China, the number of users of the cellular mobile communication system will be "superhuman". By the end of 2022, there will be 1.845 billion cellular IoT terminal users representing the number of "thing" connections. The current structure of "people" connections tends to be stable, and "things" connections will become an important engine for operators' business growth.

As the best technology for medium and high-speed Internet of Things, RedCap will bring new development opportunities to operators. According to industry insiders' forecast, RedCap will be commercialized on a large scale in 2023, and the number of connections in the first year of commercial use is expected to exceed one million. With the reduction of terminal module costs and the evolution of the network to a higher standard, RedCap will gradually replace 4G IoT and become the main delivery force of medium and high-speed IoT. In the next three years, the number of connections will reach 100 million. The application scenarios are as follows:

According to Omdia statistics, the annual shipment of cameras in China will reach 150 million in 2024, of which 10% to 20% will be wireless. It is estimated that the scale of the wireless-based video surveillance industry can reach tens of millions.

According to TSR statistics, it is estimated that by 2025, China's cellular smart wearable device shipments will exceed 80 million.

The Ministry of Industry and Information Technology clearly stated in the "Guidelines for the Construction of 5G Fully Connected Factories" that during the 14th Five-Year Plan period, it will target ten key industries including manufacturing, mining, and ports, and promote tens of thousands of enterprises to carry out the construction of 5G fully connected factories. In the manufacturing field, the average number of 5G terminals connected to each factory can be calculated as 100 to 400. It is estimated that the scale of 5G fully connected factory terminal connections will exceed 3 million in the next three years.

According to Deloitte's research report and "5G Powering Smart Grid Application White Paper" statistics, it is estimated that by 2027, the cumulative shipments of 5G terminals in the domestic power industry will exceed 50 million.

According to a report released by Strategy Analytics, the production of electric vehicles will grow at a compound annual growth rate of 26% between 2021 and 2026, and the shipments will be close to 54.1 million by 2029.

Look at the industry: RedCap's network first is the only way, and the accelerated development of the ecology will help scale commercial use

Since the freeze of the standard, 5G RedCap has continued to attract widespread attention from all parties in the industry, and many industry partners also have high hopes for RedCap. The industrial value of RedCap has been recognized by many industries including manufacturing, electric power, port, mining, steel and so on.

After more than three years of 5G commercial use, China has built the world's largest 5G commercial network and built more than 2.2 million 5G base stations, accounting for more than 60% of the world's 5G base stations. RedCap can reuse 5G base stations with wide coverage to quickly realize the large-scale deployment of the network. At present, the Institute of Information and Communications and the three major operators have completed multiple rounds of RedCap technology verification, and the conditions for large-scale commercial use of the RedCap network are mature. Looking back at the development history of the NB-IoT industry, it is not difficult to find that implementing the network-first strategy and building a quality network with ubiquitous coverage is the key to seizing the opportunities for the development of the IoT industry.

In the early stage of industrial development, the cost of RedCap modules is expected to save 50% compared with traditional 5G eMBB modules. With large-scale application, the module cost will gradually match that of LTE CAT4 modules within 3-4 years. At present, many ecological partners have planned RedCap chips, modules, and application terminal products. It is expected that in the first half of 2023, the first wave of core-mode ecological terminals will be released one after another and support RedCap’s end-to-end commercial verification. In the second half of the year, all parties in the industry will accelerate their improvement The RedCap ecosystem continues to improve its supply capacity to support RedCap's end-to-end scale commercial deployment.

RedCap creates a new blue ocean of 5G Internet of Things, and the "light" wind helps all kinds of industries to go full sail. Looking forward to 2023, RedCap will become one of the key development directions of the mobile industry. With the concerted efforts of the government, operators, equipment manufacturers, terminal manufacturers and even industry customers, it will gradually realize large-scale commercial use of the network, rapid connection increase, and accelerated maturity of the ecosystem. Add vitality to the further large-scale application of 5G, and help the digital transformation of the industry to go into battle "lightly".