What 'G' Do Connected Devices Need?

Many of the wireless operators in the U.S. are switching off their 2G networks to refarm that spectrum for Long Term Evolution (LTE), but there's a group, billions deep, that may want to keep the legacy network around.

That group's made up of machine-to-machine (M2M) devices that only need short bursts of data, often for stationary uses. So, not the connected cars or fleet management, necessarily, but the smart meters, vending machines, e-readers and other less intensive data devices.

The relevancy of the 2G network came up at Connected World Magazine's conference outside of Chicago on Tuesday. In light of the operators sunsetting all or parts of their 2G networks, the question arose: Is using LTE overkill or a future-proof decision? (See Photos: Connected World's M2M Jam.)

Verizon Wireless VP of Vertical Industry Solutions Janet Schijns said that the carrier, the furthest along in its LTE deployment, is continuing to invest in 2G, but is encouraging its customers to look carefully at their solutions. It's a significant cost to replace a device's module, so she suggests to customers that if their solution will ever need more data, they should start with LTE now. She said that eight out of 10 of Verizon's customers think about switching to 3G/4G when they consider the economics, and half eventually land on LTE.

Glenn Lurie, AT&T Inc. (NYSE: T)'s head of emerging devices, agreed, noting that if customers underestimate data needs then down the road they'll either have to change the module out or potentially be shut down.

"LTE modules are more expensive because they carry a bigger load," Lurie said. "More and more people coming to us were already planning to go to 3G, but the question is do they go to LTE?"

It's this hard sell on LTE that's helping T-Mobile US Inc. sign up more customers for its 2G network, which Jeremy Korst, the carrier's VP of wholesale, maintains will always be sufficient for a lot of use cases. For example, T-Mobile's M2M partner, RacoWireless , announced Tuesday that it has signed up point-of-sale giant Apriva Wireless, primarily because its current operator partner, AT&T, is sunsetting 2G in some of its major markets. (See T-Mobile's Back in the M2M Business.)

Sprint Corp. (NYSE: S)'s VP of emerging solutions, Wayne Ward, leaned more toward T-Mobile's point of view, but chose to instead talk up the benefit of multimode devices, which makes sense for the multi-network operator as it's deep in its Network Vision rollout.

"The fact of the matter is right when we get our head around 4G, you guys will start talking about 5G," Ward jibed at his competitors on stage. He said the best way to approach M2M is to find out the customer's app and desired end user experience, and then reverse engineer it.

"You don’t lead with the technology," he said, but you do make an agreement to support the network it lands on for 10 years or more.

Of course, the network isn't always a company's biggest decision. Business model is most important to most, something the panelists agreed on. Or, as AT&T's always-diplomatic Lurie put it: "We get enamored with our crap, but it's about, 'what do people want to buy?'"

— Sarah Reedy, Senior Reporter, Light Reading Mobile

sarahthomas1011 12/5/2012 | 5:30:23 PM
re: What 'G' Do Connected Devices Need?

The G decision will really be made on a case-by-case basis as operators are shuttering their 2G networks in some markets and not others. It'd make sense to stay on 2G if you're a stationary, infrequent data user in a market where the carrier can guarantee long-term support for 2G...but that's a lot of ifs. 

Most vendors I talked to didn't think Wi-Fi was an option because it wasn't reliable or secure enough, they said.

joanengebretson 12/5/2012 | 5:30:14 PM
re: What 'G' Do Connected Devices Need?

A 2G shutdown is likely to be a big deal for users of m2m devices. These devices aren't replaced nearly as often as consumer devices. And when AMPS was sunsetted about 5 years ago, a lot of these people were hoping 2G would be around for a decade or so. It can be a substantial cost to change out all of their equipment.

krishanguru143 12/5/2012 | 5:29:47 PM
re: What 'G' Do Connected Devices Need?

A lot of them just went to the next G up and really should have looked at 3G at the time.


Going to LTE makes sense in that you can use IPv6 and get rid of the NAT in the middle of the current setup.  LTE was designed with IP and data rather than GPRS/EDGE or UMTS/HSDPA.  LTE will allow it to set there and have an IP the connection up a lot better than the other G's allow.


WiFI is secure if you use a VPN tunnel accross it.  This should be done even on any G network though.  If security is a concern, then you never send anything in clear text over any connection.

joanengebretson 12/5/2012 | 5:29:45 PM
re: What 'G' Do Connected Devices Need?

I think some of the m2m eqpt vendors went to 2G instead of 3G at the time of the analog sunset because 3G did not yet reach everywhere they needed coverage. Some of these apps are used in relatively remote areas.

It's a similar situation now with regard to LTE.

I don't know how expensive it would be to build a device that could use LTE or 3G depending on availability but that would seem to be the best approach.

But even AT&T is opting for 3G, not 4G, in its new wireless alarm system.



Net Worthy 12/5/2012 | 5:29:44 PM
re: What 'G' Do Connected Devices Need?

For many M2M applications 3G provides no benefits beyond 2G but 3G radio hardware costs more. The USA is an exception because AT&T is already phasing out its 2G network.

Another issue for the M2M device makers is that it's easy to create a couple of 2G product variants that cover a vendor's international markets; that's harder to do with 3G where there are too many frequency bands being used worldwide. The situation with 4G is even worse, and we are years away from seeing an LTE "world radio" that works just about everywhere.


krishanguru143 12/5/2012 | 5:29:44 PM
re: What 'G' Do Connected Devices Need?

While true, it was also a true lack of vision though.  Just because the coverage isn’t there today, that wouldn’t be true down the road.  While a 2G and 3G radio was more expensive then, they are cheap these days.  The same holds true for LTE, expensive today but once it becomes widely used, it will be cheap.  How many companies still want to sell a 2G only radio these days and how many still do?  They have moved to 3G and soon 4G.  These holdouts that waited until the end to make a move from analog will see the same scenario happen again when 2G is gone.  3G and 4G both offer better spectrum allocation than that of 2G, so I would expect to see 3G stick around.

krishanguru143 12/5/2012 | 5:29:43 PM
re: What 'G' Do Connected Devices Need?

That was a financial decision that someone made to save a few bucks early on only to spend more down the road at replacement time.  That 20% is absolutely nothing though; the cost to replace it down the road is more than the saved.  It is not the baseband processor that is 20% more though.  Some companies don’t even produce them anymore and as competitors drop out of that marketplace, the others are free to raise the costs.  The ones that still manufacture them are produced on an obsolete process and keeping it around costs money. Fab want to transition to the smaller process as it cuts their costs in the process.  Man of these 2G baseband processors are built on 65-nm and up technology.  How about the cost to re-do a board design because what was used is no longer available?

As for a premium for 3G, the easy solution, don’t enable 3G off the bat.  A 3G baseband processor supports 2G as well, if you use 3G or not is definable.  So the solution would have been to produce the device and allow 3G to be disabled if the customer required it to be and have it allowed to be switched back on remotely when it reports in at a future time.  Then when 2G is going to be sunset, the device can be switched over to 3G mode without needing to be replaced down the road.

The vendors do indeed play a part.  Some of them still only sold analog up until a year before the sunset and even then only offered 2G devices.  Then up until a year or two ago, some finally went to 3G and some haven’t even made that transition yet.  The customer can’t buy what is not available.  If they are asking for it or not, the vendors need to stay on top of where the industry is headed.  Since they rely on the wireless carriers to provide the service, they need to pay attention to what they are doing to update their offerings.  Most offer nothing in terms of 4G and many that offer 3G haven’t even bother to update to the faster 3G offerings at all.  At times, being cheap just costs you money.


The biggest advantage to 4G is that the device is not behind a NAT.  This allows it to be polled rather than just waiting for it to connect.  Need to update firmware or make changes, pretty easy to do with 4G, not so with 3G or 2G.

krishanguru143 12/5/2012 | 5:29:43 PM
re: What 'G' Do Connected Devices Need?

These M2M vendors need to accept the fact that they need to continue to keep up with the times, if they started to deploy 3G enabled devices a few years ago, there would be less to replace today.  Their problem is that they make a transition and then sit by and wait for the next sunset and then complain about it.  If they would continually update their side so new installs would have “newer” G support, they would be better off in the long run.  If they went right to 3G (which would have had 2G support as well) this would have been a non-issue for them right now.  They went the “cheap” route and in the end will be more expensive because they will have to replace the equipment yet again.  They should be looking at 4G and just bite the bullet, when 4G is available they can use it, in the interim they have the 3G to use.  When 5G starts to come around, they need to start looking at it and when the economies of scale are there, start deploying 5G enabled devices.  What will they do though, move to 3G and when that gets sunset, move to 4G and complain all along the way.  The other alternative, they could build their own network and keep things status quo as needed which wouldn’t be cheap either.

So what is cheaper, paying more for the hardware or having to replace the hardware?  In many cases, the labor alone costs more than the part, so if they did it right to begin with, this wouldn’t be an issue.

Net Worthy 12/5/2012 | 5:29:43 PM
re: What 'G' Do Connected Devices Need?

It's not the vendors driving the slow adoption rate of 3G M2M, it's their (my) customers. The cost difference between 2G and 3G is dropping but it's still at about 20% on the hardware. Our North American customers are now asking for 3G but no-one else is. It might make better sense, long term, for those customers to be buying 3G now, but they don't think long term.

Another problem: until about 6 months ago some of the non-North-American carriers insisted on charging a premium for 3G network access, even for low data rate M2M applications. In same places (parts of Latin America) the price difference was more than 100%.

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