In Machina Research’s Predictions for the Internet of Things in 2016, we included one that “Telecommunications is sexy again”, quoting a range of telecoms-related topics that will come to the fore during the year. As we gear up for the regular trip to Mobile World Congress (we have seven analysts in attendance) thoughts naturally turn to the key connectivity technology issues underpinning the Internet of Things which are the key topic for discussion in Barcelona at this time every year.
The first thing to note is the massively growing importance of IoT in the conversations being undertaken at Mobile World Congress. Almost every vendor, operator, whatever, has an IoT-related message today. They realise the key growth role that new connected devices will play now that almost everyone in the world already owns a black oblong (“smartphone” is the usual term). The challenge is to pick out those companies that really have an IoT message to tell, from those that are just bolting the term on to an existing set of capabilities.
That said, almost all of the latest mobile technology trends do have an IoT angle. In many cases it’s more than just and angle; they’re the fundamental driver. The most obvious example is the new Low Power Wide Area networks such as LoRa, Ingenu, Sigfox and the 3GPP Narrowband IoT (for which we await the standard with baited breath) which are grabbing the headlines. This is a year when confusion reigns in terms of which technologies will dominate, so we expect Barcelona this year to be full of companies trying to work out which of these multiple technologies is going to be available and when, which is the best, and which is likely to dominate. At Machina Research we’ve been tracking this segment since before it even had a name (our own Jim Morrish was responsible for coming up with the ‘LPWA’ name).
Moving to more traditional mobile networks, we’ve witnessed a shift within LTE with LTE-M, Cat.0 etc. to make 3GPP technologies more IoT friendly. Counter-intuitively 2016 is likely to be the year when these techs get less friendly to IoT. We know that there will be a number of 2G network switch offs progressed during the next 12 months: AT&T, various in Australia, Singapore and so forth. We also expect a lot more messages about plans for switch off. The upshot is more uncertainty about the availability of 2G and 3G networks for the long-term support of deployed IoT connections. Our own prediction is that companies deploying IoT globally in 2020 probably won’t be able to rely on 2G and 3G coverage across a typically global footprint, and by 2025 they definitely won’t be able to. Clarity is required. And we’ll be keeping a close eye on operator announcements in Barcelona.
There will also be a lot of talk in Barcelona about 5G. We’ve proposed some views on this technology evolution and the impact on IoT. The immediate impact is actually likely to be relatively small. The focus for considerations of the air interface is on providing as much bandwidth as possible, which is typically less important for IoT than for more traditional mobile services. Eventually the heterogeneous RAN and single core capabilities will create benefits for IoT, but it’s not exactly the driver. Increasingly though, the other main networks trend, Network Function Virtualisation/Software Defined Networks (NFV/SDN), is being recognised as being important for IoT. The characteristics of service agility, cost alignment, and network flexibility and scalability facilitated by NFV/SDN are immensely applicable in the case of carrier strategies to IoT.
The most interesting thing to watch, however, will not be related to networks. It will relate to how companies position themselves for IoT. The biggest unmet demand in IoT today is in professional services, effectively holding the hand of enterprises as they deploy IoT. The accusation that is levelled at telcos is that they are bad at moving into these types of customer-facing services areas. That was arguably true for consumer services. But for enterprises, many telcos have built very strong and globally recognised IT services firms. Supporting the growth of IoT is closer to the latter. However, as telcos move more in the direction of the professional services angle on IoT they will come up against a set of companies who are coming from the IT space, and who will also be out in Barcelona. Telcos, IT service vendors and every other tech vendor is still trying to find its place in the new IoT ecosystem. Mobile World Congress offers one, particularly mobile, angle on proceedings and we wouldn’t miss it for the world.
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February 25, 2019