Wireless and Digital Services

Money in low power wide area networks for IoT won’t come from connectivity

By Tim Murdoch - Last updated: Wednesday, September 27, 2017

Direct to cloud“Money in low power wide area networks won’t come from connectivity” Mohamad Nasser, general manager of Sprint’s IoT business unit reported to Mobile World Live this week.

LPWA (low power wide area) networks such as LTE-M, NB-IoT and LoRa are designed to move small amounts of data from billions of things as efficiently as possible. And small amounts of data mean small amounts of revenue per device for the network operator. That is why the likes of Sprint in the US and Vodafone in Europe are not content to provide just the secure data pipe, but are looking to market verticals in order to deliver more of the solution stack and gain more of the value.

Device connectivity, provisioning and management or even general purpose data collection, analytics and visualisation are basic table stakes for IoT services – general services applicable across all market verticals. So, this ambition by Sprint and others is a bold statement to climb further up the value chain and provide market specific products and services.

Sprint’s focus on four verticals provides some insight into how this strategy may emerge:

  • Transportation
  • Insurance
  • Retail
  • Healthcare

Clearly, Sprint is picking those industries where mobility, wide area and live data are fundamental characteristics: But to be truly successful Sprint will need to address each one of these markets with unique insights, different offerings and specialist services.

The first wave of hype for IoT focussed on enabling the transport and capture of data through connectivity and platforms – general purpose tools for others to build on. The future and true value of IoT may be finally emerging – the enabling of specialist services with specific points of value and insight for real customers. As I suggest in an Interface article recently, perhaps we will even start to see truly “smart” solutions, not just connected things with a “smart” label.

How successful the operators become in delivering the full stack of specialist digital services will be interesting to see. Not only will this mean a very different relationship with their customers, they will also start to compete with specialists in these markets; companies with a similar vision perhaps, but who consider connectivity and device management as simply a basic utility.

And, as my colleague Michal suggests, this will make it hard for the network operators to value the spectrum needed to deliver all this promise – a process made harder by lessons from 2000 where over-hyped visions of the value of ‘content’ ran amok in the scramble for 3G spectrum – a scramble that depressed the telecoms market (until the iPhone arrived).

Speaking of which, it is interesting to note, that with Apple’s increased focus in servicing specific groups of people for healthcare, mobile operators are not alone in “going vertical”. With all this focus on gaining more value by going direct to the end customer, only the very best, most engaging and most relevant services are going to succeed.

If this is you, we’d love to help.