August 22, 2016
The 3GPP isn't known for its haste. In the race to fill the gap for a low-power, wide-area (LPWA) communications technology, the cellular specifications group has been worryingly slow off the mark. Not until June was NB-IoT -- the standard that has attracted the most attention -- included in the 3GPP's Release 13. France's Sigfox and others using non-3GPP technologies have had the field largely to themselves. But that is soon about to change.
A cellular retort to Sigfox , LoRa and other LPWA technologies that use unlicensed spectrum, NB-IoT is quickly powering up. Just last week, Singapore's MobileOne Ltd. (M1) (Singapore: MONE) said it would launch a commercial NB-IoT network in the first half of 2017 in partnership with Finnish vendor Nokia Corp. (NYSE: NOK). Vodafone Group plc (NYSE: VOD), one of NB-IoT's most prominent backers, similarly plans to introduce commercial services next year. Matt Beal, Vodafone's director of architecture and innovation, has proclaimed that NB-IoT will "crush" Sigfox and LoRa when it finally appears. (See M1 Plans Nationwide NB-IoT Network with Nokia and Vodafone to 'Crush' LoRa, Sigfox With NB-IoT.)
Even one of Sigfox's customers has an eye on 3rd Generation Partnership Project (3GPP) standards. Verisure, which is using Sigfox technology to support its security offerings, recently confessed it would consider adding NB-IoT and LTE-M, another 3GPP technology, to its range of technology options in future. (See Sigfox Customer Verisure Eyes NB-IoT.)
The stakes are potentially high. Expectations are that billions of devices, from smart meters and household appliances to bits of industrial equipment, will eventually have to send information over data networks. Many of these devices will be in use for several years but have very limited bandwidth needs: Think of a tracking system, for instance, that "bleeps" every few minutes to provide an update on the whereabouts of a particular asset.
Existing cellular technologies, with their focus on piping ever more bandwidth to users, are wholly unsuited to the LPWA task. To succeed, technologies need to be extremely energy-efficient, reducing power costs, and capable of transmitting signals over long distances using a comparatively small number of basestations. Minimizing the cost per bit is the ultimate goal.
Sigfox, LoRa and others already hold considerable attractions. Sigfox, for example, is reported to have been charging as little as $1 annually to connect a device, boasting a huge cost advantage over cellular rivals. Ingenu , another LPWA player based in San Diego, claims it can cover vast areas with its RPMA (for random phase multiple access) technology using just a fraction of the basestations needed by its competitors. (See Sigfox Plans Global IoT Network and Ingenu Revs Up IoT Rhetoric.)
Yet large mobile operators are likely to favor 3GPP technologies for a host of reasons. For one thing, upgrading cellular basestations to support NB-IoT is likely to be a straightforward software job, in many cases. Rolling out Sigfox or LoRa will look much costlier. And operators used to working within licensed frequencies fear that unlicensed-spectrum technologies will be subject to congestion and interference.
Such concern appears to be influencing the strategy of one or two operators in the vibrant French market. Eager to meet existing LPWA demand, Orange (NYSE: FTE) has been rolling out a LoRa network at home. Yet it has also indicated that it would prefer to use licensed-spectrum technologies, hinting that it may eventually replace LoRa with a 3GPP standard. Numericable-SFR , France's second-biggest operator, is currently a customer of Sigfox. But it recently revealed it was "experimenting" with NB-IoT and LTE-M. "NB-IoT and LTE-M are not available yet and SFR's strategy is to bring new IoT solutions to its B2B customers right now," a spokesperson told Light Reading. (See LoRa May Not Be for Long Haul at Orange and France's SFR 'Experimenting' With NB-IoT, LTE-M.)
Next page: Not an open-and-shut case
Not an open-and-shut case
It is not just an aversion to unlicensed spectrum that may be driving operators toward 3GPP standards. Many do not want to be tied to a single vendor or narrow equipment ecosystem outside the 3GPP community. Thanks to the efforts of the LoRa Alliance , LoRa has acquired the appearance of openness to some. And yet a Californian chipmaker called Semtech Corp. (Nasdaq: SMTC) still controls the intellectual property behind the technology. Sigfox makes its designs freely available to chipmakers but takes a huge cut of service revenues generated by its network "partners." Ingenu does not pretend RPMA is anything but proprietary, although executives insist that ownership of all the intellectual property allows Ingenu to offer guarantees and commitments its competitors cannot match.
But the case for NB-IoT and other 3GPP technologies might not be quite so clear-cut. With the backing of the 3GPP, and as multinational operators throw their weight behind NB-IoT, new suppliers will be persuaded to join the fray. Competition combined with economies of scale should reduce equipment costs. Yet NB-IoT may have a long way to go before it catches up with its LPWA rivals.
That could be enough time for Sigfox, LoRa and others to become more firmly entrenched. Sigfox reckons the costs of adding its technology to an endpoint will fall from about $2 to $0.50 in the next five years, and that comparable costs for NB-IoT will drop from $40 to around $5 over the same period. That difference could equal a substantial amount of business. (See Sigfox Said to Face Customer Backlash.)
Want to know more about the Internet of Things? Check out our dedicated IoT content channel here on Light Reading.
Moreover, despite the acceleration in NB-IoT standardization and activity, a number of big cellular operators are still pinning their colors to the LoRa mast, including KPN Telecom NV (NYSE: KPN) of the Netherlands and India's Tata Communications Ltd. . South Korea's SK Telecom (Nasdaq: SKM), meanwhile, has described LoRa as a "pillar" of its IoT strategy that will prop up demand for "low mobility" services, as well as applications requiring little bandwidth. For everything else, the operator prefers LTE-M, although it is looking into NB-IoT. (See SK Telecom Sees LTE-M, LoRa as Its 'Two Main IoT Pillars'.)
This raises the possibility that 3GPP standards co-exist with and even complement LPWA technologies such as LoRa, Sigfox and Ingenu's RPMA. Individuals representing all three of those technologies have predicted such a development, although some backers of WiMax, an ill-fated '4G' technology, were similarly sanguine about the emergence of LTE.
In the short term, it seems highly likely that NB-IoT will struggle to match Sigfox, LoRa and Ingenu (not to mention other LPWA technologies) on certain key measures. The big unknowns are whether the 3GPP attractions outweigh such drawbacks, how important they are to organizations deploying IoT services, and how fast the cellular communications industry can overcome them. "The NB-IoT train is coming," a spokesperson for the LoRa Alliance told Light Reading earlier this year. Its arrival could change the IoT landscape radically.
— Iain Morris, , News Editor, Light Reading
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