When should IoT manufacturers adopt the 5G New Radio (NR) standard? The answer is: it depends on the technical requirements of the device. Let’s take a look at what IoT manufacturers today need to know about 5G NR standards relative to product development timelines.

5G NR Standard Overview

The first thing to understand about NR is that it's not going to replace the existing Machine Type Communication (MTC) cellular standard anytime soon. Massive MTC (mMTC) connections work well on 5G, and currently, the entire 5G mMTC space is running on LTE-M and NB-IoT.

In other words, 5G is not an alternative name for NR. In the mMTC realm, 5G is based on LTE-M and NB-IoT waveforms. These massive IoT standards support low data rates, with NB-IoT typically transferring data at rates of around 100 kbps; and LTE-M delivering hundreds of kbps, around 1000kbps or 1Mbps.

For data rates in this range, we expect both LTE-M and NB-IoT to support MTC requirements until at least 2030, and possibly longer. So what's the point of the NR standard?

Essentially, NR waveforms and parameter sets support higher data rates, measured in tens or hundreds of Mbps, depending on original design and purpose. These extremely high rates support a host of IoT use cases, including smart watches, headsets, telematics, smart home devices, and even data-heavy devices such as mobile routers, IoT gateways, and other IoT aggregators.

Essentially, NR waveforms and parameter sets support higher data rates, measured in the tens or hundreds of Mbps, depending on the original design and purpose.

The 5G NR standards discussed below are developed and maintained by the 3rd Generation Partnership Project (3GPP), in particular its working committee dedicated to radio access networks. As of this writing, 3GPP has been working on two NR standards for cellular IoT:

NR Reduced Capability (RedCap): NRRedCap is a 5G NR standard for radio access with a target data rate of several hundred Mbps. That's roughly the same data range that LTE Category 4 and Category 6 standards currently cover, so we can expect the RedCap to replace devices currently connected via LTE Category 4 or 6.

NR Enhanced Reduced Capability (eRedCap): While 3GPP's Release 18 is still under development, its initial definition introduces an NR standard that is suitable for the current LTE Cat1/Cat1bis data rate range. Enhanced RedCap or eRedCap supports use cases using several Mbps, for example, many consumer IoT devices with audio or video capabilities.

Depending on the use case of the device, RedCap or eRedCap may offer stronger performance on 5G networks than the current LTE standard, and while it is naturally future proof, the question of when to switch to NR should depend entirely on the use case and development schedule.

5G NR IoT Business Case

Before deciding when to start implementing RedCap technology, we had to look at the business case for the product. In other words, what does the product do? Consider three hypothetical businesses:

1. Company A

Firm A manufactures battery-powered smart meters for the global market. The life of this product is determined by the battery life, which is about 20 years. With very low data requirements and government customers, the benefits of 5G NR may not yet exceed current cost or deployment constraints. The enterprise is better off sticking with a dual-mode LTE-M and NB-IoT solution that covers all its local markets.

2. Enterprise B

Company B manufactures smart home panels and sells them in multiple countries. The most important connectivity factor for these products is reliability, but corporate leadership also wants to simplify inventory with a single SKU and keep their unit costs below current levels.

In terms of network availability, some countries only offer LTE-M; others only offer NB-IoT; and some offer both. Since NB-IoT cannot support the data rates required for smart home panels that require at least LTE-M speeds, the enterprise may not be ready for 5G NR, both because of cost and because of global network availability. For the next 10 years or so, they're better off with Cat1 or Cat1bis, which are available globally.

3. Enterprise C

Firm C manufactures consumer electronics. Their brand image is technologically cutting-edge and future-proof, and businesses don't have much cost or time constraints. This is an ideal use case for 5G RedCap or eRedCap (depending on actual data rate needs), as it capitalizes on the excitement around 5G, but only if 5G products can be released in 2026 or later.

Speaking of 2026, that could be the year we start to see the transition to 5G NR become commonplace. Let's talk more about the projected timeline, with the caveat that no one knows how quickly the technology will evolve. These are just our best guesses.

5G Transition Timeline: Educated Guess

Based on the 3GPP report and the current cellular environment in 2023, it seems likely that cellular IoT will begin its massive march to the 5G NR standard in 2026 or 2027. RedCap should have become commonplace a year ago, so start looking for competitors to implement RedCap in 2025 or 2026.

That won't stop early deployments in limited regions in 2023 or 2024, and the high unit price will still prevent mass adoption.

As the technology landscape changes, we don't have to commit to RedCap or eRedCap. Most early adopters of the 5G NR standard will include dual-mode connectivity in their products first.

For example, a chipset with iSIM connectivity might support Cat1 or Cat1bis as well as NReRedCap. This way, the device can choose the connection standard that provides the best performance no matter where it moves. This flexibility bridges the gap between the old web and the new paradigm, which is really good news.

Looking further into the future, one can expect eRedCap to further develop into what we call feRedCap (Further Enhanced RedCap), which will be an NR equivalent to existing LTE-M and NB-IoT.

This can be done in the context of 5G or the upcoming 6G, replacing existing waveforms and parameter sets designed for 4G and ensuring longevity in evolving networks. In this white paper we explain how to obtain a cost- and power-optimized dedicated 5G NR solution for massive IoT.