Author: Zhao Xiaofei
Recently, Cisco released an announcement on the cessation of sales and discontinuation of LoRaWAN products on its official website, officially announcing that it will withdraw from the LoRaWAN market. In the past ten years, LoRaWAN has been adopted by a large number of manufacturers and customers around the world, supported a wide range of application scenarios, and successfully fought its way out of many low-power wide-area IoT technologies and became a de facto standard in the field of global IoT. At present, the ecology around LoRaWAN has been very large, and Cisco, as one of the leading manufacturers in the LoRaWAN field, announced its withdrawal from this field this time, although it is surprising, but overall the impact on the LoRaWAN market is limited.
Timeline for Cisco's exit from the LoRaWAN market
Cisco has made a list of 47 products or components that will be being phased out, including gateways, sensors, antennas, management software, power protectors and components, among others, most notably 800MHz and 900MHz LoRaWAN gateways, and related products.
According to Cisco's timetable for exiting the LoRaWAN market announced on its official website, the company will stop selling LoRaWan hardware, software, and related accessories and licenses from January 1, 2025, with a final shipping date of April 1, 2025. After January 1, 2026, Cisco will no longer develop, fix, or test LoRaWAN-related software versions, and after December 31, 2026, it will no longer support security vulnerabilities. Customers who wish to extend their service and support contracts until December 31, 2029, after which Cisco will discontinue all support for LoRaWAN products.
Regarding the product migration option, Cisco said that there are currently no migration plans for Cisco LoRaWAN gateways, and there are no replacements for related products. However, where applicable, customers may be able to use the Cisco Technology Migration Program (TMP) to trade in eligible products and receive credit for the purchase of new Cisco equipment.
As mentioned at the beginning of the article, Cisco used to be an important promoter of the LoRaWan global market and one of the core contributors of the LoRa Alliance.
The views of all parties are that Cisco's exit will have a limited impact on the LoRaWAN market
In fact, Cisco's decision to withdraw from the LoRaWan market is not because of the decline of the LoRaWan market, but more closely related to the overall environment it faces.
In August, Cisco announced a 7% global layoff, and in a regulatory filing, the company said it was implementing a restructuring plan that would result in $1 billion in pre-tax charges for its financial results. This is the second round of mass layoffs at Cisco, which said in February it would cut 5 percent of its workforce, cutting more than 4,000 jobs. Cisco's core networking business, including switches and routers, has been on a downward trajectory since large enterprises began to move to cloud computing years ago. Cisco has explained that the layoffs will allow it to invest in new growth opportunities such as artificial intelligence.
In this context, it is easy to see that the LoRaWAN related departments, as a small organization within Cisco, do not contribute much to the performance, and it is easy to become an optimized part of the management's decision to change the organizational structure.
Matt Hatton, founder of market research company Transforma Insights, commented that Cisco is not a first-tier supplier in the LoRaWAN field, and its layout of LoRaWAN is only a supplement to its traditional router business. Relatively small vendors, such as MultiTech, Kerlink, etc., are the most dynamic players in this market.
The LoRa Alliance has not expressed much concern about Cisco's withdrawal, because the LoRaWAN ecosystem has expanded many times compared to 2015, and customers have more choices. "We can confidently say that the LoRaWAN ecosystem, which has hundreds of members around the world, continues to achieve significant global growth and innovation across multiple industries," said Alper Yegin, interim CEO and Chairman of the LoRaWAN Alliance. LoRaWAN is an open standard, it does not depend on any single vendor, and customers can continue to use LoRaWAN through new vendors. Customers have a large number of suppliers to choose from in the supply chain, and multiple gateways using LoRaWAN are widely available. ”
Market research institutes' views on LoRaWAN
In June this year, market research institutes released a report showing that the low-power wide-area network (LPWAN) connectivity space is dominated by NB-IoT and LoRa, which together accounted for 87% of total connections in 2023. This dominance is here to stay, with these two technologies expected to account for 86% of all LPWAN connections by 2030.
While the significant growth of NB-IoT is driven by its popularity in China, LoRaWAN leads the way in most other regions. Both technologies are well-suited for the mid-tier IoT applications that are currently in high demand, ensuring their continued leadership in the LPWAN market. Among them, LoRaWAN is expected to remain the preferred choice for private IoT connectivity, and outside of China, LoRaWAN remains the leading LPWAN connectivity technology due to its growth momentum over the years.
Another market research firm, IoT Analytics, has a similar view of LPWAN. In March this year, the agency released a report showing that the number of LPWAN connections worldwide continues to grow, with nearly 1.3 billion LPWAN connections worldwide by the end of 2023, and is expected to grow at a compound annual growth rate of 26% in the next few years, reaching 3 billion connections by 2027.
According to the tracking of IoT Analytics, the proportion of connections using various LPWAN technologies in the world in 2023 is: NB-IoT share is 54%; followed by LoRa, with a 29% share; LTE-M came in third with a 14% share; Sigfox accounts for only 1%. It is estimated that by 2027, the market share of various types of LPWAN technologies in the world will be as follows: NB-IoT will further expand the market share, with a market share of 58%; LoRa still ranks second, accounting for 24%; LTE-M has a share of 15%; Sigfox is still at 1%.
Proportion of LPWAN connections in different forms
（来源：IoT Analytics）
China has the world's largest IoT market, and its scale far exceeds that of other countries, so driven by the Chinese market, NB-IoT has become the unshakable "king" of LPWAN. If the Chinese market is not considered, the LPWAN market pattern in other countries and regions around the world presents a different picture, that is, the number of connections of LoRaWAN ranks first in the global market.
IoT Analytics tracking data shows that in the global market excluding China, the number of LoRaWAN connections accounted for 41% of the total LPWAN connections in 2023, the number of LTE-M connections accounted for 31%, and the number of NB-IoT connections was only 20%.
With the foundation laid in the past few years, coupled with the very flexible business and business cooperation model of the LoRa ecosystem, LoRa will still maintain a stable market share and influence in the IoT market in the next few years. For example, Amazon AWS has released a number of LoRaWAN-based products, and AWS's self-developed communication technology Sidewalk has also integrated LoRa modulation technology into it, becoming an important player in the LoRa ecosystem. For another example, Quectel, the world's largest module manufacturer, also released LoRa module products.
IoT Analytics predicts that by 2027, excluding the Chinese market, LoRaWAN will still have a 36% share of the number of LoRaWAN connections in the global LPWAN market, still occupying the first place in LPWAN technology.
Overall, Cisco made a great contribution to the LoRa ecosystem ten years ago, but it has become a thing of the past, and the LoRa ecosystem has formed a new dominant force, and the exit of Cisco is only a small episode in the development of the industry.