Cellular IoT Connectivity Set to Drive Smart City Growth Through 2035

By Jason Gigax January 29, 2026

Cellular Internet of Things connectivity is emerging as a cornerstone technology for smart cities and digital infrastructure, with the global market projected to grow rapidly over the next decade. Valued at $6.7 billion in 2024, the cellular IoT connections and connectivity market is expected to reach $126.7 billion by 2035, reflecting a compound annual growth rate of 30.7 percent.

This growth is driven by the expansion of next generation cellular networks, increasing digitization across industries, and rising demand for secure, wide area connectivity to support billions of connected devices. Cellular IoT technologies now underpin applications ranging from smart transportation and energy management to healthcare monitoring, logistics, and industrial automation.

Analysts point to smart city development as a major catalyst for market expansion. Cities increasingly rely on IoT enabled systems to manage traffic, public safety, utilities, and environmental monitoring. Cellular IoT offers broad coverage, low latency, and carrier grade security that short range technologies cannot provide at scale.

Advancements in 5G are accelerating adoption. In 2024, 5G accounted for 37.5 percent of the market by network type, and it is expected to remain the dominant technology through 2035. Reduced capability 5G, known as RedCap, is opening new use cases in wearables, industrial sensors, and building automation by offering lower power consumption and reduced device complexity. At the same time, NB IoT and LTE M continue to support large scale, low power deployments such as smart metering and asset tracking.

North America led the global market in 2024 with a 35.8 percent revenue share, supported by advanced telecommunications infrastructure, strong public and private investment, and early adoption of cellular IoT technologies. The United States plays a key role through widespread deployment in transportation, healthcare, manufacturing, and smart city initiatives.

Despite strong growth prospects, challenges remain. Cybersecurity risks, high infrastructure costs, fragmented standards, and complex regulatory environments continue to shape market dynamics. However, emerging hybrid connectivity models that combine cellular and satellite networks, along with flexible pricing and service models, are creating new opportunities for broader adoption.

As smart infrastructure projects expand worldwide, cellular IoT connectivity is expected to remain a foundational technology for enabling connected, resilient, and data driven cities well into the next decade.