I have to speak generally on this subject (not my area of responsibility) but there are many orgs that are under State/gov/EU regulations when it comes to purchasing.
Today it's easy because there is only one Microsoft to buy our Licenses from (including LTC).
If we have to get them from an IOT vendor it will force many orgs to do purchasing rounds with increased costs as result.
Worse is the loss of flexibility. A License bought through Dell for example can't be moved to an HP. That will also increase license and operational costs.
The use case here is a desktop used as kiosk machine and the need for the kiosk goes away - the desktop gets reimaged with standard enterprise making it org standard and freeing that ltsc license. The next day a new kiosk need arises in an office 400 miles away. Today you would take a spare usable desktop at that office and reimage it with the ltsc image and done. With IoT you now must have machines of both types (standard and IoT) in store and you as result again will have increased costs for logistics