A fresh look at MNOs' IoT strategy

Over the past few weeks, there have been several commentaries about IoT strategies for mobile network operators (MNOs), several of these expressed at Mobile Europe’s 2018 IoT in Telecoms conference.

Vodafone’s Director of IoT, Stefano Gastaut [1], expressed visible frustration about the ‘dumb pipe’ label attached to MNOs and the implied commoditization of connectivity. Enrico Bagnasco, Head of Innovation at TIM articulated [2] a ‘horizontal services’ view.

And, finally, Ericsson published a study [3] drawing on interviews with 20 mobile operators about the status of their IoT priorities and the strategic opportunities for growth. One highlight in Ericsson’s findings is that 70% lack a well-defined strategy. While many are testing different roles in the IoT value chain, 80% plan to move up to higher layers.

On the whole, it therefore looks as if the industry has got second wind, aiming to build on a first phase of growth, triggered by the GSMA’s ‘M2M and Beyond’ industry strategy.

So, are operators on the right track to capitalize on the opportunity or has the market passed them by?

2017 in Review: Making the IoT work

Looking back over notable, M2M/IoT corporate initiatives in 2017, mobile network operators (MNOs) and technology vendors were the two most active groups in the industry eco-system.

The main feature amongst MNOs was market expansion into new geographies. Sometimes, this happened individually; more often, it took the form of partnering with other network operators. This is a classic growth model for the mobile operator community.

In the technology vendor community, leading initiatives took the form of: acquisitions/investments; partnering (with MNOs, platform providers and system integrators); and, product innovation.

In comparative terms, activity among platform organizations was subdued. And, end-users barely featured among 2017 initiatives. It is likely that these last two data points mask a higher level of internal activity targeting operational scaling and in-house developments as firms solidify their foundations in the IoT market. As an example, Altair, a provider of engineering software to enterprise customers, acquired the Carriots IoT platform. This initiative illustrates the trend to internalize IoT capabilities and has parallels with the earlier acquisition of ThingWorx by PTC [1].

SK Telecom’s IoT strategy looks beyond Connected Devices

Over the summer, Korea’s SK Telecom outlined its strategy to capitalize on the IoT opportunity. From a networking standpoint, SK Telecom has invested in a nationwide LoRa network. It plans to offer a hybrid offering in parallel with LTE-M over its conventional mobile network. This combination allows SK Telecom to span a wider spectrum of coverage and cost-structure alternatives. Its technology choices use licensed and unlicensed spectrum, support differing data-rates, and, offer a broad range of embedded module costs to deal with barriers to adoption in low price-point (or low perceived value) devices.

Lessons from IoT Week Korea

I had the good fortune to attend IoT Week Korea 2015 in Seoul during the week of 26-30 October. This was a great opportunity to check in on Korea’s 2014, IoT Master Plan [1] and gauge how this leading edge country is mastering the IoT opportunity.

It was interesting to note that the corporate sponsors for this event were SK Telecom and PTC (owner of ThingWorx). PTC, of course, has made strategic and investment commitments to capitalize on what it views as a significant market opportunity.

There were two parts to the event – a sizable display zone and a full-day conference with four parallel sessions focusing on key technologies and solutions. 

LTE to spur IoT?

A few years ago, it was standard practice to associate M2M with low data rate characteristics that could be served using 2G networks. In fact, there was quite an uproar when some operators started to announce 2G network shut-down plans. Ignoring the economics of operating cellular networks, some industry commentators also talked of retaining a portion of 2G spectrum for M2M devices.

Recently, a representative[1] from Google reiterated the special characteristics (low bandwidth and inexpensive) of IoT applications and the need for a brand new network. Over the past few years, several initiatives have been launched to address the potentially massive, low data and low power requirement segment of the M2M/IoT market; Neul and SigFox are two examples that spring to mind.

It was therefore interesting to hear of a development that has been working its way through the 3GPP standards process. LTE, traditionally associated with high data-rate mobile services, is now being engineered to address M2M/IoT applications. This is not a case of data-intensive video surveillance or digital display applications but the use of LTE in moderate data rate, low cost and long battery life scenarios.