NB-IoT Gets Insecurity Complex

Reactions to reports of NB-IoT's difficulties betray some insecurity about the prospects for the LPWA technology.

Iain Morris, International Editor

June 6, 2017

6 Min Read
NB-IoT Gets Insecurity Complex

When it comes to providing connectivity for the billions of devices that will make up the future "Internet of Things," security is deemed an essential requirement. But the purveyors of NB-IoT seem far from secure about the outlook for the much-ballyhooed connectivity technology.

Concealed by an outward display of braggadocio, their worry is that NB-IoT will miss out on a lot of business and end up with a smaller share of the market than expected. Last year, Vodafone Group plc (NYSE: VOD), one of the technology's chief backers, argued that NB-IoT would "crush" its technology rivals when it emerged this year. Yet the alternatives continue to attract supporters amid reports that NB-IoT has missed rollout targets, remains far too expensive for customers and is beset by interoperability problems. (See Vodafone to 'Crush' LoRa, Sigfox With NB-IoT, Vodafone to Miss NB-IoT Launch Targets NB-IoT? Not at Those Prices, Say DT Customers and Ericsson, Huawei incompatibility threatens NB-IoT – sources.)

The industry's reactions to those reports are what betray the insecurity. Talk of interoperability problems between equipment vendors Ericsson AB (Nasdaq: ERIC) and Huawei Technologies Co. Ltd. is now rife at industry events. Numerous industry experts have also flagged the issue in discussions with Light Reading. Yet Ericsson and Huawei have pleaded ignorance, while operators have either denied there are problems or declined to comment.

The timing of one recent statement on interoperability also looks odd. Vodafone this week said it was carrying out NB-IoT interoperability tests more than two months after it was supposed to have launched commercial services in some European markets, and having never previously acknowledged that interoperability is a concern. Those tests have shown that all is tickety-boo, it insists.

Even if interoperability is not a serious issue, perceptions to the contrary could prove damaging. But trying to explain how those views have taken shape might necessitate some embarrassing disclosures about NB-IoT's history. Instead, the people behind the technology have largely clammed up. "I can't get anybody to talk to me about it," says Syed Hosain, the founder and chief technology officer of IoT operator Aeris Communications Inc.

Want to know more about the Internet of Things? Check out our dedicated IoT content channel here on Light Reading.

What seems undeniable is that NB-IoT was a rushed job following an abrupt rethink by the cellular industry on the need for a so-called low-power, wide-area (or LPWA) technology. Two and a half years ago, cellular industry folk at the GSM Association (GSMA) were "dismissive" of LPWA, according to Tom Rebbeck, a director at the Analysys Mason market research business. "Then within a year they had turned around because they saw the momentum behind Sigfox and LoRa," he says.

Indeed, in the absence of a suitable cellular technology, several Tier 1 operators have made commitments to the technologies that Rebbeck cites. Based on unlicensed spectrum, both Sigfox and LoRa have put the cellular industry under considerable pressure to bring NB-IoT to market as quickly as possible. "That there are interoperability problems is not surprising," says Bengt Nordström, the CEO of the Northstream market research and consulting group. (See SK Telecom Sees LTE-M, LoRa as Its 'Two Main IoT Pillars', Orange Hails LoRa Breakthrough as Bouygues Ups IoT Game and Sigfox 'Only Option' Today, Says Telefónica.)

Whether or not the rush to standardize NB-IoT did lead to problems, the 3rd Generation Partnership Project (3GPP) specifications body made "corrections" to the standard as recently as March, according to Ericsson. The Swedish vendor recently shared this information when speculating why there might have been talk about NB-IoT interoperability problems, saying the ecosystem would have to catch up with the 3GPP's changes. It initially described the corrections as "atypical," but subsequently said this label was "probably incorrect," in a further sign of insecurity. The 3GPP, meanwhile, did not respond to Light Reading's requests for comment on the matter.

Next page: Slowly does it

Slowly does it
Then there is the slow rollout of NB-IoT networks. Vodafone finally claimed to have introduced a commercial service in the Netherlands this week, two months later than originally planned. And in other markets where it had been aiming for a launch by the end of March, including Germany and Ireland, the status of NB-IoT remains unclear. In February, Germany's Deutsche Telekom AG (NYSE: DT) heralded the "commercial expansion" of NB-IoT in eight European markets. But the operator has yet to see any major customer tenders for NB-IoT, largely because networks are still not commercially available, a Deutsche Telekom executive recently told Light Reading. (See Eurobites: Vodafone Netherlands Finally Switches on NB-IoT Network and DT Claims World First on NB-IoT.)

If interoperability is not holding up deployment, then what is? After all, NB-IoT rollout is supposed to involve "a simple software upgrade to… existing 4G base stations," said Vodafone last October. "This means that the rollout will be rapid and will deliver nationwide coverage almost immediately," said the company in a statement on its website.

Asked to explain the delays, Vodafone denied there were any technical issues and appeared to suggest that its customers were not "ready" for NB-IoT. "The launch of NB-IoT in each market is as much about when our customers are ready as when the network is available," said a spokesperson for the operator. But if customers are not ready, then why has the industry rushed to bring NB-IoT to market in the first place? And why did some operators pounce on LoRa and Sigfox, in the absence of a cellular alternative, to address immediate demand for LPWA services?

A likelier explanation is that customers are not ready for NB-IoT prices. Modules still cost somewhere between €10 ($11.25) and €15 ($16.87), according to Deutsche Telekom, against an industry target of just $5. That rules out a lot of business, especially as the cost of a Sigfox module is said to be only about $2. Driving these equipment costs down to a more economical level is perhaps the greatest challenge for the NB-IoT industry.

In time, NB-IoT is likely to address these various pain points and become firmly established in the market. How long that takes, though, may determine how much business goes to the likes of Sigfox and LoRa for the foreseeable future. "Every time we look at something that has a device impact, experience and history shows us that it is not until the third generation of a chipset that it is a commercial product, and that you are very seldom at the right price point, power consumption levels and stability with the first-generation chips," says Nordström. "That is why we see NB-IoT becoming commercial by 2019."

NB-IoT might yet crush Sigfox and LoRa, but that process could take much longer than its supporters must have hoped.

— Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

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About the Author(s)

Iain Morris

International Editor, Light Reading

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

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