An extensive strand of recent research at Transforma Insights has focused on Communications Service Providers (CSPs) and their activities in IoT. Episode 6 of the Wireless Noodle is the first of two episodes that focus on this topic. This one looks at the changing face of mobile networks, and the added complications from the arrival of 5G, the roll out of new Low Power Wide Area Networks, and the shutting off of 2G and 3G networks.
You can access it here, or via Google or Apple.
The full transcript of the podcast is available below.
It’s all change in the mobile world. 5G and new narrowband technologies are on the way in and 2G and 3G networks on the way out. Knowing where to place your bets is more important than ever.
Last week I promised you a discussion about the forthcoming Transforma Insights report about Communications Service Providers and what they’re doing in IoT.
For the last ten years I have been writing in-depth reports about how Communications Service Providers such as AT&T, Deutsche Telekom, Telefonica, Verizon and Vodafone address the IoT market. I am currently nearing the end of the research phase for the inaugural Transforma Insights ‘Communications Service Provider Internet of Things Peer Benchmarking Report’. The changes happening in the provision of connectivity are perhaps bigger now than they have ever been.
That being the case, I’ve decided I need to stretch it over 2 episodes. In this first one I want to delve into some of the exciting things that are happening in the network technologies. And then next week I’ll get to grips with who’s top of the class and why?
It’s certainly an exciting time to be in telecoms. I spoke back in Episode 3 a little about the network virtualisation that’s going on. That’s pretty exciting. But it’s far from the only thing happening. In Episode 1 I talked about my book The Internet of Things Myth that came out in April. One big part of that book that I didn’t talk about was the extensive discussions about new network technologies. 5G is grabbing the headlines but also really important for IoT are the new wide area narrowband technologies that have recently arrived, and the fact that operators around the world are going through a process of switching off 2G and 3G networks. I think it’s worth looking at each of them.
There have been a lot of superlatives thrown around about 5G, up to and including it being the most important invention since electricity . Ignoring the hyperbole, the difference from previous mobile technology generations is three-fold:
- Increased bandwidth – Theoretically 5G offers speeds of up to 10Gbit/s but the experienced maximum speeds by a single user are typically 100-200Mbit/s, about 5x higher than LTE. This opens up higher bandwidth applications such as online gaming, virtual and augmented reality (AR/VR). It also makes mobile a viable alternative to fixed line broadband for more households.
- Support for massive IoT deployments – 5G networks can manage up to one million devices per cell, clearing the way for much larger deployments of IoT.
- Lower latency across all applications – Historically, mobile networks never had latency much better than 50ms. 5G promises latency as low as 1ms, although in reality it will be more like 10ms for most communications.
While higher bandwidth is certainly appreciated, and history suggests there is an almost unquenchable desire for more bandwidth, no-one has yet come up with a game-changing use case that means that 5G is anything other than a welcome incremental addition courtesy of delivering superior throughput in a more cost-effective way.
Regarding the ability to support massive deployments, we are currently nowhere near needing this additional capacity. According to the Transforma Insights IoT Connected Devices Forecast there are less than a few billion connected devices in use across wide area and campus networks worldwide. And that relates to 4 or 5 million towers. So maybe 1,000 devices per tower, so a few hundred per cell. Nowhere near the million devices per cell that 5G promises. Plus, most of the devices will be simple sensors, reporting only occasionally. The volumes of connections do not particularly indicate an overwhelming demand for cells supporting thousands of devices, let alone hundreds of thousands, all active concurrently.
The game-changer, if there is one, is latency. While a 5x improvement might not appear transformational, it may well be. This is less because of the capabilities that it enables and more because of the relative latencies of the various parts of the network. Getting total latency below 100ms, and ideally below 30s, is needed for gaming and AR/VR. 5G certainly delivers that. However, as noted above, demand for those types of services is, at best, unproven. The change that 5G creates is that the core network, rather than the access network, becomes the slow part. Historically the radio access network (RAN) was always the bottle-neck. The 20ms delay added by a 1,000km round trip to a central server was not the limiting factor. With 5G as the RAN, the core network suddenly represents 2/3 of the delay .
The overall impact of a 5G RAN would be to improve the latency regardless of how an application is architected. However, applications that are hosted at the edge of the network have a proportionately bigger gain. The natural response must then surely be to put more processing and storage at the edge in a much more distributed model, for instance with 5G base-stations doubling up as mini data centres. Such a reduction in latency also encourages the shift of compute power for IoT applications out of the devices themselves and into the base-station; why have smart edge devices when the network latency back to a more cost-effective network edge compute function is only 10ms?
The result of 5G deployments therefore is that compute shifts to the edge of the network, either from the cloud, or from the device, or both. This means a potentially big change in how services are delivered and by whom. But does it really make much difference to the applications that are supported. Broadly speaking no. My pat comment is that 5G talks about IoT much more than IoT talks about 5G. Technology vendors are looking to promote as wide a set of use cases for 5G as possible, including some pretty micro-niche application.
But for the most part the IoT adopters won’t find much benefit in using 5G. That contrasts neatly with the wildly useful (and cheap) low power wide area technologies that have also broken onto the scene in the last few years.
The other new arrival, or rather set of new arrivals, are the low power wide area (LPWA) technologies. These technologies are unapologetically low bandwidth, designed to support distributed sensors of all types. By paring back the capabilities the developers have been able to provide a couple of major benefits. Firstly, and most importantly, very long battery life. Devices can operate in the field on nothing more than a simple battery for maybe 10 years. Brilliant for any application that doesn’t have ready access to power. Bear in mind that a 2G device would last maybe a matter of a couple of weeks, if you’re lucky. Secondly they’re typically very cheap. Of the order of $1-$5 a piece depending on which tech you’re using. You can probably see why we’re expecting billions of these devices.
Today I want to share a bit of background on these new technologies. But really you should hear from the grand-daddy of LPWA, Jim Morrish, who coined the phrase back in 2013. That’ll keep for another week. For this episode here’s the simple version.
There are essentially two types of Low Power Wide Area technology. One set of technologies use unlicensed spectrum, i.e. the same as baby monitors and wireless microphones, and the other set use licensed, i.e. that owned by mobile network operators.
The big advantage of unlicensed spectrum is that it’s free to use. But it does come with technical limitations, which is part of the reason why the capabilities of these technologies are limited. There’s also the risk of interference.
Licensed technologies were developed for and by the mobile operators as a response to the arrival of the unlicensed. The intention was to develop an equivalent to the unlicensed technologies that were promising some competition.
There are really 2 of each you need to be aware of. First the unlicensed.
Sigfox – a French company that is was one of the first to emerge in the IoT space back in 2010. The inventors decided that they would not only develop the technology but would deploy networks, either themselves or through granting franchises to others around the world, so called Sigfox Network Operators. These include Kyocera in Japan, Liquid Telecom in Africa and Unabiz in Singapore and Taiwan.
On the plus side its devices are VERY cheap. But the technology is very basic, providing almost exclusively an uplink data service (from the device to the network) and can handle only small messages of a few bytes. Fine for smoke alarms or similar. Another problem is that it’s not a standard.
It has about 16m connections today.
The other big unlicensed technology is LoRa. It was Developed by Cycleo, which was subsequently acquired by Semtech. It is just a technology - anyone can buy equipment and deploy a network or a single base station. In some cases it’s rolled out for a campus. In other cases it’s rolled out as a national overlay network by companies such as Everynet on behalf of network operators such as Orange in France.
Compared to Sigfox it is significantly more capable, with good uplink and downlink data rates of up to 6kbits/s and reasonable capacity. However, being based on unlicensed spectrum inevitably means potential challenges for interferences and therefore density of devices. LoRa is partially a standard. Some parts of LoRa - the MAC protocol - is open standard, developed by the LoRaWAN Alliance. But the physical layer remains proprietary to Semtech and anyone wanting to manufacture needs to seek a licence from it. This means there remains a risk of monopoly supply issues and that all the benefits of a fully open standard are not realised.
Today Lora has a little over 100 million connected devices.
Faced with the growing appeal of these unlicensed technologies, the mobile industry wanted its own equivalent using licensed technology. It ended up coming up with two: LTE-M and NB-IoT.
LTE-M evolved from, and is is quite similar to, existing 4G LTE technologies, with uplink and downlink speeds of over 1Mbit/s. Long battery life can be achieved, but only by severely restricting its capabilities. Other than that it is a very capable technology.
Narrow-band IoT (NB-IoT) was a clean slate technology. It arose, indirectly, from a technology called Weightless, and specifically company called Neul that drove the development of Weightless. Neul was acquired by Huawei and the technology evolved to be part of the mobile network standards.
Of the two, NB-IoT tends to be more widely deployed, but it’s a real patchwork and technology selection will often be more a question of what’s available rather than what’s needed. That said, the US and most European countries now have both.
A further complication was that back in April 2020, NTT DoCoMo in Japan announced that it was turning off its NB-IoT network after less than two years of operation having not really found enough demand. This is slightly worrying but at around about the same time we had some substantial announcements of roaming agreements between major players across Europe and the US for the same technology. I’m tempted to think Docomo is more mothballing than abandoning entirely.
Nevertheless, the lack of certainty of which techs will be available in which countries is not good for business. And that fragmentation is not just limited to new technologies being added but also to old ones being switched off.
The third big change happening at the moment is that of 2G and 3G switch-off.
Looking at the big picture, in many developed nations, 2G and 3G customers now represent a small fraction of an MNO’s total mobile phone customer base. Almost everyone has a 4G phone and increasingly 5G. It is no coincidence that legacy networks are being switched off as 5G network rollouts accelerate. Shutting down 2G or 3G will open up the use of much needed spectrum for 4G and 5G networks whilst having a minimal impact on existing revenue streams.
This switch off is generally bad news for IoT. 2G is the most widely used of the wide area technologies for IoT connections, and many were expecting to rely on the technology for many years to come. However, IoT is typically barely 1% of an operator’s revenue so decisions about switching off networks often don’t give much consideration to IoT.
Australia, Canada, Japan, Singapore, South Korea, Taiwan and the US have been in the forefront of switch-off plans. In Europe the picture is more fragmented with particular relevance being given to large scale IoT deployments. Some are leading with 2G switch off, others with 3G (which from an IoT standpoint is much preferable as there are typically way fewer IoT connections on 3G).
China is equally mixed but there has been a strong push for NB-IoT as a replacement for the other technologies. The other giant market, India, is as yet not particularly focused on formal switch-off, although in large part this is due to the de facto switch to LTE networks courtesy of Reliance Jio’s success
Less developed countries will be less likely to witness network switch offs in the next ten years. There is more of a requirement to sweat the installed 2G and 3G networks for longer and roll outs of 4G and 5G networks will be slower. There are also fewer smartphone users, and more customers reliant on 2G and 3G handsets
2G and 3G network switch-off represents a headache for anyone developing connected IoT products. Developers need to know which networks will be available in which territories and for how long. Without this they risk either seeing their devices disconnected or they will see a higher bill of materials (BOM) cost from over-specifying their devices to ensure redundancy. Some operators have been very good about giving timetables for switch-off. Others have not been.
[For more on 2G and 3G switch off, see report: A global overview of planned 2G and 3G switch-off]
A final thought.
One of the interesting things about all this is the extent to which the pendulum has swung from global to local and back to global. …
Ten years ago if you wanted to connect a device to a wide area network you had one option. Add a 2G (probably) modem to it and stick a SIM card in it. It could go almost anywhere in the world and connect on at least one operator. It was pricy but it was simple.
But we started to see more (what I can only term) parochialism in the early 2010s. There was a prohibition on permanent roaming in countries such as Brazil, India, Turkey, whether explicit or based on local registration requirements or tax obligations. That further complicates the patchwork of technologies. Not only do you need to know if the tech is available but you also need to know that your device will be compliant with local rules on what can and can’t connect. There were also ommercial equivalents in the likes of US and Canada. I wouldn’t want to suggest that it was improper to close these loopholes. Using them to permanently connect IoT devices was barely in the spirit of roaming agreements.
But then we overcame those barriers partly through technical solutions and partly through partnerships and alliances between the operators. That ironed out some of the problems. The pendulum had swung back to the global.
Fast forward 5 years and we see the pendulum swinging back towards the local.
At a basic level the networks available are more fragmented, as I’ve mentioned repeatedly. 2G/3G switch off means that the old networks might or might not be available, 5G roll-out and the availability of NB-IoT, LTE-M, LoRa, Sigfox and so forth are by no means guaranteed. There is less consistency of network availability now than there was 10 years ago. The tools themselves may be better, but the deployment environment is more diverse.
Speaking of NB-IoT, there’s specific local issues with that, even where deployed there will be worlds of difference in the degree to which it has been optimised and fine tuned. Battery life is the critical thing, and the way the network is deployed will have a lot of impact on that. The fate of the two is much more inextricably linked than was the case with say 2G.
5G has a similar dynamic. Things like network slicing and the support via private networks means that it becomes less relevant to just drop a random device onto any network and expect it to work perfectly.
There is no longer an arm’s length relationship between device and network. And you have to make sure the network is optimised for what it is supposed to achieve. Everything has become much more specialised. And Localised. The dynamic has changed again.
Next week’s podcast will delve into the actual findings from the Communications Service Provider IoT Peer benchmarking report, looking at some of the key trends other than the networks areas I’ve discussed this week. I will also share who the top vendors are in categories such as technical capability, vertical services and geographical coverage.
I hope you can join me.
Links to some of the research that I’ve refered to in this week’s show, as well as a transcript of the recording, will be available on the podcast website at WirelessNoodle.com
Thank you for listening to The Wireless Noodle. If you would like to learn more about the research that I do on IoT, AI and more, you can follow me on Twitter at MattyHatton and you can check out TransformaInsights.com.
Thanks for joining me. I’ve been Matt Hatton and you’ve been listening to the Wireless Noodle.