Wireless and Digital Services
Narrow-Band Internet of Things (NB-IoT) is an exciting technology, offering ‘direct-to-cloud’ connectivity for billions of devices at very low cost. However, it’s not without its challenges…
Paul Beastall, Consulting Director of Technology Strategy, shares his thoughts in this video blog.
For in-depth analysis, download our Ofcom report: Review of latest developments in the Internet of Things.
A couple of months ago I went to Mobile World Congress in Barcelona, which is the mobile industry’s biggest global trade show. I think one of the most exciting things for me was a relatively new technology called NB-IoT – or Narrow Band Internet of Things. Like everything in telecoms, NB-IoT is a big pile of acronyms but is really a new technology that is designed to offer connectivity to ‘things’ – rather than to people – using the existing mobile networks. It’s particularly exciting because it’s a very simple upgrade to the existing infrastructure, so it can be deployed very quickly. It’s a truly global standard. We’ve already heard from Vodafone, Deutsche Telekom, China Telecom, Telstra in Australia, that they are already building these networks.
The key point of this technology is to support low cost connectivity to ‘things’, so it’s designed to be a direct-to-cloud connectivity. So you no longer need to go via your smart phone using Bluetooth. This technology just passes information directly to mobile phone base stations and on to the network. It’s designed to deliver very small amounts of data from a very large number of devices. We’re talking here about billions worldwide and at a very low price point. One of the benefits of the small amounts of data is that it’s designed to offer very, very long battery life. We’ve seen examples of parking sensors that can be deployed in the ground with a ten year battery life. It’s something you build once and it lasts for the entire life of the product.
One of the key advantages of the direct-to-cloud approach is that it gives a massively improved user experience. When I buy a Garmin or a Fitbit or anything like that, I need to pair it to my WiFi or to my smartphone via Bluetooth and that’s not always an easy process. These products can come pre-connected: I can open the box and they just work. It also means I don’t need to carry a smartphone, so I can provide connectivity to things that aren’t near me but that I want to monitor. For example, I could track my cat or my child. The other advantage is that because it’s a global standard there are very broad coverage plans. This is a single technology that will work when I’m at home, when I’m at work, when I’m travelling, when I’m on holiday. From a user experience point of view we can just buy and forget it.
That doesn’t mean it’s all straightforward. There are some challenges, particularly in the technology’s maturity. It’s a new technology and most interesting perhaps is the business model. At the moment when I use my smartphone to connect my gadget to the internet, I’m actually paying for that connectivity, for that data, and not necessarily realising it. It’s in my tariff and it goes on my bill. If there is a direct-to-cloud connectivity then the mobile operator is going to need some revenue for that. We need to work out who pays for that connectivity. Is it me as a user? Do I pay directly for the service or do I pay a bit more for the product and it comes with free airtime? Those are some of the issues that need to be resolved.
Perhaps a bigger cultural issue for product companies is how they move from selling a product via a retailer, to delivering a service. Having an ongoing relationship with their customers is obviously very attractive to them, but needs some cultural change as well. In all of the Internet of Things space we also need to ensure that we are delivering a secure solution, particularly where we’re collecting personal data from people. Cambridge Consultants is already very actively involved in IoT and in particular the NB-IoT platforms. We’re developing early solutions that will enable product companies to build the technology into their products. We’re also working on service design, data analysis and business models. Data analysis is particularly interesting because the sensors collect lots and lots of data. We need to turn that data into insight before we can generate commercial value. We’re also looking at regulation and the evolution of the market. We’re studying how this new technology will deliver new services for users. We’ve recently done a project for the UK regulator Ofcom, looking at the market for the Internet of Things between now and 2021, identifying both consumer benefit and the role that the regulator may need to take in the future.