CLX Communications, our parent company, recently published a whitepaper called Internet of Things: Last Mile Connectivity Options Explained together with Mobile World Live. The whitepaper explores different technologies used to connect IoT devices, and how they satisfy the needs of different IoT applications.
So what is important for mobile operators to understand when it comes to last mile connectivity for IoT applications? Based on the whitepaper, we see a number of important implications for operators that want to exploit the IoT opportunity:
It is no longer just about traditional mobile communications standards
So far, IoT applications that require long-range connectivity have been deployed using existing mobile services such as SMS, GPRS and LTE. These are mobile standards originally deployed with primarily human users in mind. This has worked fairly well for many IoT applications: these standards offer robust connectivity with ample capacity to support the most demanding applications
However, the high capacity of the existing mobile technologies is also their main weakness. Many IoT applications don’t need this capacity: devices such as electricity meters, payment terminals, and sensors typically transmit only small amounts of data at a time, often with long intervals between transmissions. The power requirements for a high bandwidth link make devices for such applications unnecessarily complex and in many cases completely infeasible. Furthermore, current radio technologies don’t support the high density of connected devices that are needed for many IoT applications.
In response to this, several competing standards have emerged for Low-Power Wide Area (LPWA) communications. These standards offer much lower transmission speeds, but in return they put much lower power demands on devices and allow for a larger number of connected devices per cell site, opening up for a whole new range of IoT applications.
To be able to reach the full market for IoT connectivity, mobile operators will have to make significant infrastructure investments and either refarm old spectrum for use with LPWA technology, or acquire additional spectrum licenses.
There will be competition from unlicensed connectivity technology and new entrants offering services in licensed frequency ranges…
Some of these new LPWA standards allow for operation in unlicensed radio spectrum. This means that anyone is allowed to set up their own equipment and start connecting devices.
The use of LPWA technology in unlicensed spectrum naturally poses a threat to the IoT efforts of existing mobile operators. With no need for a license, any number of companies can enter the market, either to support their own IoT devices or to sell access to their network to others. In addition to this, new operators focusing solely on the LPWA opportunity can also buy spectrum licenses to offer LPWA in licensed frequencies.
…but existing mobile operators are very well placed to profit from emerging technologies that support IoT applications
Mobile operators are still in a very strong position to win market share in the market for LPWA IoT connectivity. Both compared to competitors that use unlicensed spectrum and new entrants acquiring spectrum, mobile operator have a number of advantages:
- Experience of operating reliable wide-area wireless networks: Most mobile operators have a long experience of operating mobile network with a high level of service availability in an efficient manner. Compared to competitors offering LPWA in unlicensed spectrum, licensed LPWA offers a higher level of reliability as the operator has full control over radio transmissions in the assigned frequency spectrum.
- Existing infrastructure: While LPWA services require new radio modules, existing infrastructure such as cell sites, backbone connectivity and data centres can be used to lower the investment needed.
- Complementary mobile services: IoT solutions can rely on different types of devices, some that require low-power connectivity and others that need a high bandwidth. Only mobile operators can offer complementary mobile services that meet both of these needs.
One challenge that we see is that mobile operators are not focused solely on IoT customers. To successfully meet the needs of this market segment, it is not enough to provide the connectivity itself. You must also be able to create an attractive customer experience for your IoT customers, providing offers that fit their business model and giving them the tools they need to make their business succeed with IoT. While new entrants face an uphill battle when it comes to deploying the network itself, there is a distinct risk that they can successfully compete by creating a superior customer experience for the IoT segment.
At Symsoft, we have experience of working with both service providers offering IoT connectivity as well as companies deploying IoT solutions to improve their business. To learn more about how we can help you succeed with your IoT services, read more about the Symsoft IoT Platform or contact us by filling in the form below, and if you haven’t read it already, download the CLX Communications whitepaper.