Vested Interests Are Delaying the Formation of Critical Mass in the IoT Market
August 18, 2016 Leave a comment
- The cellular industry is scrambling to catch up with LPWA providers, but its solutions are not yet fit for purpose.
- The jury (a.k.a. software developers and customers) is still out as technology vendors pursue their own agendas.
Leading figures in the LTE supply chain, including chip makers, device makers, equipment vendors and even operators, are following their own agendas. This is creating a kaleidoscopic picture of the IoT wireless access market that inhibits investment.
Driven by the fear of missing out, the cellular phone industry is fighting to get back on terms with suppliers of proprietary low-power, wide-area (LPWA) network access technologies for machine-to-machine (M2M) and Internet of Things (IoT) applications. Anyone who needs networks to provide low-cost access and operation to justify their IoT deployments should have regard for the claims and counterclaims made by the various parties. While there is some truth in all the claims, by no means is it the whole truth and nothing but the truth.
Why is this even an issue? Most operators have plans to sunset the 2G networks that currently connect most of the estimated 400 million M2M devices installed to date. Cisco reckons M2M connections will grow at 30% a year to become 45% of all 26 billion connected devices by 2020. More nuanced, Ericsson says cellular IoT connections will grow at 27% CAGR to 1.5 billion by 2021, while non-cellular IoT connections will grow at 22% CAGR to 14.2 billion of the 28 billion connected devices. Many, even most, could be LPWA connections that use unlicensed or ISM (industry, science and medical) narrow or ultra-narrowband formats, like LoRaWAN, Sigfox, RPMA, Telensa, Weightless, WiFi and Bluetooth, to name but some.
No wonder then that the cellular industry is trying to get into a market predicted to offer 10x connections. Pushed by Vodafone and Huawei to include narrowband LTE (NB-IoT), the 3GPP accelerated standards development and made some name changes in time for Release 13 of the LTE standard published last June. But, key elements are missing, such as performance specifications and test protocols for NB-IoT (now known as Cat-NB1) and the largely comparable LTE Cat-M (now known as Cat-M1). However, these are expected by year-end 2016. This will allow silicon foundries to make their choice, software developers to start coding and testing to start. Expect commercial rollout of both formats from early to mid-2018.
The 3GPP is continuing to develop LTE standards for high-data rate, low-latency use cases, but the MulteFire Alliance, backed by Qualcomm and Nokia, is adapting LTE for use in unlicensed spectrum. It aims to let operators and ‘neutral hosts’ use small cells running LTE in the 5GHz band, long WiFi’s preserve. And note MulteFire is different than two other initiatives to get LTE into unlicensed bands – LTE license-assisted access (LTE-LAA) and LTE/WiFi aggregation (LTE-WFA), both of which require the operator to own an LTE channel for backhaul.
The WiFi industry is planning to adapt WiFi for unlicensed 900MHz bands to stay competitive with LTE for coverage; the new Bluetooth 5 standard, expected later this year, will provide ‘connectionless’ connectivity for IoT use cases, and standards maker ETSI is developing a converged ultra-narrowband standard for IoT as well as general IoT security standards, giving IoT network buyers even more to consider.
Current Analysis research shows that companies that have taken the IoT plunge are seeing ROI in under 12 months, but their success is attracting hackers. Unless there is a compelling reason, IoT network buyers could postpone decisions until early 2017, when the standards and security landscape is likely to be much clearer and it will be easier to select the right tool for the job.