The Internet of Things, or IoT, is a purported use case for 5G. The mobile network and the "things" of IoT have a long history. Before IoT was ever a buzzword, and when the internet existed at a handful of universities, vending machines were using the public land mobile network (PLMN, as it was called then) to inform the people stocking them of their supply levels via SMS text messages. Compared to the cost of the vending machines, the items they vend, and the cost of a man and a van delivering these items, it was obviously advantageous to optimize the route and stock carried in the field by knowing which machines were in need of which items, even when sending a text message was relatively expensive.
Now there are specialized networks for vending machines, utility meters, and other sensors that need brief and infrequent communication over long distances and at low cost. These networks are called low power wide area networks, or LPWANs. The two most widely used are LoRa and Sigfox. "Brief" and "infrequent" means, at most, dozens of messages per day and dozens to hundreds of bytes per message.
LPWANs are examples of how digital radios can be designed for specialized use cases: in LPWAN use cases, the requirements are low cost, low power, and long range. High data rates, low latency, and long duty cycles are not needed in these use cases and these capabilities can be sacrificed to achieve the design goals for LPWAN radios. LPWAN radios and networks are capable, at very low cost, of acquiring small amounts of data from battery powered devices with long battery life, low hardware cost, infrequent maintenance intervals, every few hours to every few days. As long as your use case fits these parameters, the hardware and the rates for using LPWAN networks are cheap.
LPWAN technology decisions can be complex: Users of LoRa often stand up their own networks, which means they have coverage where they need it, at some cost in equipment and siting, but with very little ongoing cost. Commercial LoRa networks are operated by more than 100 network operators in most countries in the world. Some LoRa networks are open public networks.
Sigfox has longer range than LoRa. All Sigfox networks are built and run by Sigfox. Sigfox coverage is excellent in most of Europe, Japan, South Africa, Kenya, and many US cities, but absent in many parts of the world, and you can't set up your own private Sigfox network.
Not all sensor devices fit the ideal LPWAN parameters, or have compatible cost requirements. For example, automated lighting for your home has no constraints on power consumption, and needs only short range communication. WiFi and Bluetooth, especially Bluetooth Low Energy (BLE) are suitable for short range connections. A simple device consisting of sensors, a microprocessor, and a BLE radio can run on a tiny button battery for two years, or even longer. At the other end of the spectrum of use cases, if, for example, your sensor data is coming from aircraft or ships at sea, you will need to use satellite communications to acquire that data.
Many kinds of devices in the field, especially those that don't have power constraints, can and do still use text messages on the mobile network. Mobile network operators, by creating pricing plans specific to these cases, can compete with LoRa and Sigfox.
Can the mobile network operators get beyond devices sending text messages? In theory, a global, interoperating IoT network could be advantageous: It would piggyback on mobile phone network coverage. It could take advantage of global roaming capabilities to simplify commercial relationships in IoT applications. Radios would, at least in part, benefit from the intense focus on power consumption and cost in mobile phone radios. 5G radio and network technology has the potential to enable inexpensive, global, IoT communication.
One way to measure the likelihood that 5G IoT communications technology will gain traction is to look at the already-available mobile network technologies created for IoT, which are known as Narrowband IoT, or NB-IoT, and LTE Machine Type Communication, or LTE-M. NB-IoT is intended to be inexpensive and have low power requirements, while LTE-M is more like a variant of LTE for devices other than phones. Both are in use worldwide with dozens of network operators offering service.
While it is outside the scope of this explainer, IoT has security issues. Many IoT security issues stem from the difficulty of updating devices in the field. While a high-bandwidth connection does help with updating remote sensing devices, by itself 5G does not do much to enhance security for IoT, or any other application.