NB-IoT Gets Insecurity Complex
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, , News Editor, Light Reading