Global IoT connectivity faces a re-alignment in 2026 as enterprises abandon DIY models for managed services to mitigate operational risk.
For CIOs managing distributed assets, the last decade has been defined by a specific operational friction: the gap between the promise of the IoT and the headache of actually maintaining it. We have spent years patching together global estates using a patchwork of operator contracts and shifting technical standards. That model is breaking.
According to Eseye, the industry will enter a “great re-alignment” in 2026. The complexity of global connectivity has hit a threshold where internal teams can no longer cope. The resulting shift is a flight to safety, moving away from ‘do-it-yourself’ approaches towards managed services that transfer the risk off the enterprise balance sheet.
The core challenge has evolved, it is “no longer just getting connected, but rather managing that global IoT connectivity intelligently, securely, and reliably.”
Two-speed cellular reality
The most immediate catalyst for this shift is the fracturing of global cellular infrastructure. While the US and APAC markets accelerate toward 5G Standalone (SA) networks – unlocking low latency and network slicing – Europe is lagging.
Adam Hayes, COO at Eseye, warns that European operators, starved of investment capital by restrictive roaming regulations, are largely rolling out 5G Non-Standalone (NSA). This provides a speed boost but relies on legacy 4G cores; failing to deliver the full feature set of 5G.
This creates a brutal dilemma for hardware longevity. An asset deployed today with a 10-to-15-year lifecycle must survive in a “fragmented landscape”. It needs to be backwards compatible with European 4G while remaining forwards compatible with 5G SA in leader markets.
This fragmentation is a primary reason why integrated SIM (iSIM) adoption has stalled. Engineers are hesitant to lock into a single design when the ground beneath them is shifting. The smart move for 2026 is defensive: designing for multiple radio access types (multi-RAT) to de-risk the investment.
2026 reveals the ‘DIY’ IoT connectivity trap
In theory, the new SGP.32 eUICC standard solves this by enabling operator-agnostic connectivity. In practice, it may be leading enterprise IT teams into a “DIY delusion”.
Paul Marshall, Co-Founder and CCO of Eseye, argues that treating SGP.32 purely as a technical spec ignores the commercial weight it carries. He predicts 2026 will be the year this “dream collides with a harsh operational reality”.
Taking control of your own switching profiles means you effectively become your own virtual operator. The overhead is immense: negotiating individual carrier contracts, reconciling bills in multiple currencies, and managing support desks across different time zones. Technically, the enterprise must also validate that a device profile from one operator doesn’t fail when switched to another—a testing burden few IT departments are staffed to handle.
We are likely to see a “U-turn” as finance directors review the “make vs buy” calculation. SGP.32 will succeed not as a tool for enterprise operational independence, but as the engine behind managed services that abstract this chaos behind a single contract.
Carriers pick a lane for IoT connectivity in 2026
The pressure isn’t limited to the enterprise side. Mobile Network Operators (MNOs) are facing an existential squeeze.
The legacy IoT platforms of MNOs – often older stacks like Cisco Jasper – carry a cost-to-serve that destroys margins when applied to low-revenue IoT devices. Ian Marsden, CTO at Eseye, suggests MNOs will be forced to “pick a direction” in 2026.
We are already seeing players like Vodafone spin out their IoT divisions. Marsden calls this “Lane 1”: bowing out or divesting to protect the high-margin consumer handset business. “Lane 2” involves partnering with specialist connectivity providers to overhaul the cost structure.
For enterprise buyers, the risk here is vendor stability. If your MNO partner hasn’t signalled a clear strategy, you risk inheriting their legacy technical debt. Marsden advises asking tough questions about how they handle global support in regulated markets; if the answer is vague, the platform likely isn’t built for the economics of modern IoT.
5G’s real killer app emerges
While the industry wrestles with these structural IoT connectivity fractures ahead of 2026, a clear use case for 5G has finally emerged. It isn’t autonomous driving or remote surgery; it is Fixed Wireless Access (FWA).
Tony Byrne, CEO of Eseye, describes FWA as the “5G killer application that has been hiding in plain sight”. It solves a boring but critical problem: getting high-reliability broadband to business sites, pop-up retail, and smart city infrastructure where fibre is too expensive or slow to provision.
Until recently, operators left the high-value managed service layer of FWA to third-party distributors. 2026 will likely see MNOs aggressively “move up the stack,” bundling hardware, security, and connectivity into a single managed offering. This turns FWA from a niche backup solution into a primary connectivity option.
Data as the AI guardrail
Ultimately, these IoT connectivity struggles serve a higher purpose: feeding the next generation of automation. We are moving toward “sentient AIoT,” where autonomous agents – not humans – manage supply chains and production lines.
Nick Earle, Executive Chairman at Eseye, notes a critical vulnerability in this model. AI agents are prone to “hallucinating” when they lack context. In a business setting, an agent inventing facts is a potentially serious liability.
Real-time data from the physical world is the only “ground truth” that keeps these models honest. Volvo Group, for instance, is connecting 500 million assets not just for monitoring, but to feed AI models with the secure data needed for pre-emptive maintenance. Connectivity in 2026 becomes the strategic asset that prevents AI from making catastrophic business errors.
Enterprises must stop treating SGP.32 as a DIY project and instead verify if their connectivity partners can absorb the technical debt of a fragmented 5G world. Operational resilience now depends on securing a data supply chain robust enough to support agentic AI.
The era of “good enough” IoT connectivity ends in 2026. The “great re-alignment” demands a rigorous audit of your operational exposure.
See also: Edge AI-powered digital twins reduce OpEx of smart buildings
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