An important milestone for the introduction of Narrowband IoT (NB-IoT) has been reached: the 3rd Generation Partnership Project (3GPP) has finalized the standardization of low-power wide-area (LPWA) technology. While supporting this standardized approach, Deutsche Telekom AG (NYSE: DT) is also developing viable prototypes for NB-IoT applications alongside startups and customers via its NB-IoT Prototyping Hub initiative.
Agreeing upon a common standard for NB-IoT is a true milestone for the mass market of the Internet of Things (IoT). Many experts believe it will drive development and innovation on several fronts. Narrowband IoT has been specifically developed to meet the low-bandwidth application requirements (such as low cost, long battery life, and deep indoor penetration) of many machine-to-machine (M2M) and IoT solutions.
What is Narrowband IoT?
The Internet of Things connects countless physical objects. These diverse applications require an equally diverse selection of networks. Real-time machine-to-machine (M2M) communication -- for example, the remote control of machines -- needs highly available and reliable connections for real-time exchange of data. The best option for such applications is LTE or will soon be the 5G standard. Networking over short distances (linking computers or tablets at home, for example) works fine using a LAN or WiFi connection. However, numerous IoT applications require only low amounts of data and numbers of messages at low cost, along with a long battery life and deep indoor penetration. These applications often cannot be efficiently served by existing technologies. NB-IoT tries to fill this gap in the M2M/IoT market. The new technology can handle a large number of connections per cell, has a long battery life of up to ten years, and offers great coverage with an improved link budget of +20 decibels compared to GSM. By using licensed spectrum for NB-IoT, Deutsche Telekom can rely on its comprehensive infrastructure. The use of licensed bandwidth offers multiple advantages, including good manageability, strong security measures and high operational reliability -- all things that many users consider to be crucially important.
The market for NB-IoT has a huge potential. Market researchers from Analysys Mason estimate there will be more than 3 billion LPWA connections by 2023. In order to tap this sizeable market, Telekom is developing market-ready products based on NB-IoT technology together with startups, partners and customers at its NB-IoT Prototyping Hub.
All sides profit from this cooperation. The innovative approach encourages the parties involved to build a solid end-to-end Narrowband IoT industry chain. Innovations are thereby made possible even faster and future growth and development of the new technology is fostered.
Additionally, Telekom can position itself as a partner in NB-IoT development, prototypes, and business models. The possibility of shaping the market for Narrowband IoT and the ability to work with innovative firms while growing their technical expertise in this field are the driving factors behind this new initiative. In being part of the development of NB-IoT prototypes, Telekom makes sure that the new solutions comply with the low bandwidth required.
The advantages for startups and other partners are also clear. They can delve exclusively and intensively into the new technology. Hence they are able to adjust their existing solutions to NB-IoT and start developing a market-ready product way before their competitors. This open innovation approach gives all the partners a better time to market (TTM) and the ecosystem builds bridges between manufacturers and markets. Moreover, they gain preferred access to the latest hardware and software as well as to Deutsche Telekom's technological expertise.
Startups will receive concrete support from Telekom experts and partners while taking part in the mentoring program. Each firm will have an advisor at its side. The mentors, participating startups and customers will meet regularly to discuss progress, tackle problems, network and share ideas.
The initiative has triggered a major international resonance. Startups from 26 countries have indicated interest in collaboration. Logistics and metering application prototypes have proven especially popular. The ideation and development of NB-IoT business models and use cases are orchestrated at Deutsche Telekom's hub:raum incubator in Berlin and Krakow.
A practical example
NB-IoT will soon be used for applications that cannot be efficiently served by existing technologies -- for example, because of the high cost. One example is smart metering. The cost of adding communication capabilities to smart water metering devices is still too high when using existing technologies.
In addition, as devices are often located in remote areas or deep indoors -- locations that are hard to reach -- strong propagation and deep indoor penetration are needed to reach them.
Moreover, these locations often make devices hard to access and power supply difficult. This is why meters often require a long battery life. NB-IoT addresses these requirements, benefiting both companies engaged in smart metering as well as end-customers.
— Dr. Alexander Lautz, Senior Vice President M2M, Deutsche Telekom