The market once expected 5G to become the universal connectivity standard for the Internet of Things (IoT) and believed that AI would drive computing power toward the network edge. However, as of 2026, AI inference is instead shifting toward data centers and end devices, while connectivity technologies continue to diversify to meet the requirements of different applications.

Competition in the IoT chip industry is also evolving as technology roadmaps become increasingly fragmented, with new value gradually shifting toward platform solutions that integrate AI, multimode connectivity, and security. The report examines how the shift of AI inference toward endpoint devices, along with increasingly diversified connectivity, is reshaping the distribution of value and redefining competition in the IoT chip market.

Key Highlights

• AI inference is becoming increasingly distributed across data centers and end devices, diverging from earlier expectations that 5G and edge computing would drive IoT growth.
• Connectivity technologies are diversifying to address the varied requirements of different applications and deployment scenarios.
• As technology roadmaps become increasingly fragmented, competitive dynamics in the IoT chip industry are also evolving.
• Competition is shifting toward platform integration, with AI, multimode connectivity, security, and software capabilities becoming increasingly important.
• These trends are reshaping value distribution and redefining the competitive landscape of the IoT chip market.

Table of Contents

1. IoT Connections Continue to Grow, but Value Creation is Shifting
   • Figure 1: Cellular IoT Connections Forecast, 2025–2030
2. AI Inference Moves to the Edge, Shifting the IoT Chip Value Chain
   • Figure 2: Redistribution of Value Across AI Inference Deployment Architectures
3. Connectivity Market Diversifies as Use Cases Take Priority Over Technology Generations
   • Figure 3: The Impossible Trinity of Cellular IoT Technology Selection
   • Table 1: Comparison of Connectivity Technologies
4. Value Shifts Toward Integration as Supply Chain Leadership is Reshaped
   • Figure 4: Security Shifts from a Differentiating Feature to a Market-Access Requirement
   • Table 2: Key Developments Among Major IoT Chip Vendors in 2026
   • Figure 5: Value Migration in the IoT Chip Industry
5. TRI’s View

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