June 2, 2015
In August 2012 AT&T announced that their 2G network would be shut down latest January 1 2017. This was somewhat surprising to me since roughly 90% of all M2M devices connected to mobile networks used 2G. (https://connectcompute.com/2012/08/08/what-will-be-the-impact-on-m2m-of-announcement-to-shut-down-2g/) Given that 3G is something of a compromise I would have believed that 2G and 4G would be a better bet – one with cheap modules, low bandwidth and great coverage and one focusing on data intensive terminals and applications.
Since two years, we have started to see mobile operators taking different roads for IoT. Good examples include Tele2 who only provide connectivity and great partnerships, Telenor Connexion who was the first to use both Jasper and EDCP (because they follow their customers) and KPN who returned back to Holland, building their business from there with excellent roaming.
And here we go again! Telenor Norway’s CTO, Magnus Zetterberg, said at an investor meeting in London that the company plans to completely shut down its 3G network in 2020, five years before it closes 2G in 2025. “It’s better to retain 2G than 3G because all the devices today are still embedded with 2G, so you will lose out without the network,” he said. “2G is still important for the M2M market.”
I believe this is a good approach since replacing all 2G M2M modules installed across the country to something else, even if only a SIM-card from someone else, is a disturbance and cost the customers neither expect nor like. The labour cost involved in changing are typically far bigger than the hardware. And Telenor is creating yet another criteria for customers to evaluate when picking mobile operator for their IoT applications. And with a 2G/4G approach an operator probably has a better answer to a customer who want to deploy a large IoT project today with an ROI calculation for 8-10 years.
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IoT, M2M, Networks | Tagged: 2G, 3G, 4G, AT&T, EDCP, Jasper, KPN, roi, Tele2, Telenor Connexion | 
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Posted by magnusmelander
October 27, 2013
Walker Information
The M2M aka Internet of Everything market is developing quickly. It is interesting to see how analysts, vendors and journalists over the last few months collectively shifted from one big number to another – from number of connected devices to Big Data business potential for Internet of Everything. It is a sign of growing up that we leave the connection focus and huge abstract estimates on number of connected devices for a focus on data and information. Data is the gold of M2M and I’m pleased that the industry focus is shifting towards the information. The industry loves buzzwords and in the M2M case we ended up in the Big Data bucket. ABI just estimated that Big Data and Analytics in M2M will generate revenues of $14 Billion in 2018. We are in the beginning of M2M aka Internet of Everything and organizations are starting to gather useful information from sensors and things. We see more open API:s and people have started blending the collected M2M data with other data to enrich the value of the information. But few if any are even close to a situation which Big Data is addressing. Most data collected in M2M applications are a couple of bytes from time to time. When mobile networks are used its predominantly tiny data in 2G networks, a lot of narrow band wireless sensors are used and when POTS is used it is typically a couple of seconds transmission. And it is not likely to change! Most of the data we are collecting from things are meter reading data, positions, status information, health data, times and so on. Nothing of that comes close to Big Data. But with big volumes of sensors and transactions we will rather need sophisticated decision support systems.
So why are Big Data brought into the M2M aka Internet of Everything discussions? First and foremost people understand that focusing on number of connected devices isn’t interesting any longer and since the solutions and applications most often are industry, function or company specific it is really difficult to translate them into mind-blowing numbers. But by looking at it from a Big Data point of view new huge market numbers are the results. Secondly, as we become more data oriented the IT companies are getting involved in Internet of Everything. And since many of them are preaching the need for Big Data solutions it is easy to bring the “M2M stuff” into the Big Data story.
I see a risk that the Big Data twist on M2M will make organization miss the ball in their own M2M efforts. Volumes, velocity and variety is not among the key issues in M2M projects today. It is too much too soon. In my experience the best approach is to get going, connecting a couple of things together with a relevant specialist M2M Service Enabler who has most of what is needed already. That way we will learn rapidly from real-time data in our own business and the trials are rapid and affordable. Then its quite easy to see what data to collect from which sources and step by step develop the collecting, management and distribution of data for maximum value to the organization. It is only when the information appears in business systems, business processes, decision-making systems or user applications that the value is realized. We simply don’t need any Big Data methods or solutions for this. It is obvious though, that sooner or later, especially if streaming data is involved, organizations will have a lot of data to process. And M2M applications will of course increasingly add to these systems down the road.
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1 Comment | M2M, M2M Service Enablers | Tagged: 2G, ABI, B3CC, B3IT, Big Data, Internet of Everything, Internet of Things, M2M, Machine-to-Machine, open api, POTS, PSTN | Permalink
Posted by magnusmelander
May 27, 2013
Many of us are convinced that M2M, Internet of Things or whatever we want to call it, will happen big ways and will bring massive change to most industries. The part of it easiest to measure is things connected using a mobile subscription and it grows with some 30% per annum. Good growth but from small numbers. Since standard mobile subscriptions sometimes are used to connect things it’s hard to say exactly how many mobile M2M connections we have but it should be close to 150M. And an absolute majority of these are 2G – probably still around 90%.
150M subscriptions is a lot and annual growth 30% normally sends sales directors on President Club trips to Hawaii. But there are a two issues I would like bring attention to.
A big part of the subscriptions comes from connected meters. Connected meters are great and enables smart metering, smart grids, new services, etc. But most of the meters are connected due to political decisions and not business decisions. I called the combination of regulation and public stimulation packages for “M2M doping” at a speech at M2M+ in Milan earlier in May which triggered an interesting discussion. Personally I believe the political push for smart meters around the world is very good for the society and obviously for the M2M industry too. My point is that people in the M2M industry must remember that a big chunk of M2M business so far comes from artificial promotion and not genuine market demand. I believe meters would have become smart also without the doping but it would have taken much longer time. Let’s not fool ourselves!
The next wave of doping is eCall and similar public initiatives. The idea to save lives and minimize injuries due to car accidents by sending an SMS with position when the airbag explodes is over ten years old. Me and my colleagues at BrainHeart Capital invested in Wireless Car at the time together with Volvo, Telia and others, and OnStar was developed in parallel by GM and others in the US. It looked very promising until the owners of the connected cars with the airbag service had to start pay for the service themselves. Very few did and Wireless Car and OnStar, both still live and kicking, had to go after adjacent business opportunities. I’m not saying it’s wrong now when politicians are pushing this to the market, I just want to remind everyone in our industry that this is “doping” and not the result of genuine market forces. Interestingly enough the car industry is very active in Telematics again, with visions and plans often quite similar to the first wave of plans ten-fifteen years ago. But due to the technical approach chosen for eCall these plans might be separated from implementation of eCall. Transport is supposed to be the biggest segment for M2M 2013 and it will be interesting to see if the “built-in approach” will beat the “BYOD-approach” that won last time.
Mobile operators have taken the lead in promoting M2M. All operators want to exploit the expected growth of subscriptions but most if not all of them are uncertain of exactly which role to play. The fact that the M2M business still is a tiny fraction of the operator’s business together with the widespread uncertainty of which role to play could make operators become less aggressive and take on a more cautious “wait-and-see” approach. I definitely don’t vote in favor for such approach and suggest more concrete collaboration with selected partners to conquer industry by industry. Specialist service enablers are key to such efforts and in a perfect world operator device connectivity platforms should be delivered with an á la carte menu of specialist service enablers for different industries. But until that happens I have to continue introducing the members of Swedish M2M Service Enablers to mobile operators one by one.
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Leave a Comment » | M2M, M2M Service Enablers, Transportation, Utilities | Tagged: 2G, B3IT, BrainHeart, BYOD, eCall, GM, Internet of Things, M2M, On Call, OnStar, regulation, smart grid, smart meter, SMSE, Telia, Transportation, Volvo, Wireless Car | Permalink
Posted by magnusmelander
December 7, 2012
At the local area network (LAN) level we have a lot of different wired and wireless alternatives for M2M connectivity. But at the wide area network (WAN) level we have few options. There are a lot of legacy solutions using the fixed switched phone network (PSTN and fixed broadband Internet access is the dominating way to connect LANs to the Internet. The mobile industry is positioning themselves as the obvious solution for wireless WAN connectivity. The mobile operator alternative includes the cheaper and low capacity 2G option, 3G and the emerging high-capacity and low latency LTE option. 2G is still by far the most utilized option with more than 90% of all M2M subscriptions. Satellite communication provides an almost complete outdoor coverage and is a frequently used alternative especially for tracking.
But there are potentially other alternatives for M2M WAN connectivity. Entrepreneurs are working on the idea to build a dedicated M2M network designed to connect billions of devices in a cost efficient and high quality fashion. One of the most interesting today is Sigfox in France who has designed and built a wireless network optimized for M2M using ultra narrow-band modulation techniques. They started roll out earlier this year and plan to have France covered by the end of this year which is amazing. Sigfox uses unlicensed spectrum (868 MHz in Europe and 915 MHz in the US) normally used by cordless phones. With open sight distances up to 40 km covered and when compared with GSM, for the same level of coverage, Sigfox’s solution requires around 1,000 times less antennas and base stations. The impact on cost is massive – it is 100 times less expensive to build, install and operate. They claim they will have France covered with some 1000 transmission sites. The radio modules embedded in the connected things are tiny and consume 1/50 of the power typically consumed by a cellular M2M module. With such low power consumption batteries could last up to 20 years before recharging or replacement is needed.
The Sigfox network is designed to connect millions of devices that only send messages occasionally – maybe once a week or once a year. The position of the object is included and data is encrypted. The bandwidth is only 100 bps which allows transfer of only small messages. And this will likely be the most common type of connected object why volumes could be very large and economies of scale could help Sigfox bring down cost to a couple of dollars per module. They predict that their efficiencies in running the network will enable them to connect devices for a couple of dollars a year.
Now you might wonder what type of mushrooms they have down in Toulouse. But already now they have announced that Clear Channel Outdoor Holdings is a customer using Sigfox to connect their billboards and MAAF Assurances just announced an agreement for their innovative connected objects’ household protection service, they have suggested to ETSI to make their proprietary UNB technology a standard and in September Intel Capital led their €10 million B round.
Friends, this is for real and companies like Sigfox have the potential to change many games onwards. Connected objects without hassle for a couple of dollars a year sounds attractive, doesn’t it? Bonne chance!
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1 Comment | Inspiring example, M2M, Networks | Tagged: 2G, B3IT, ETSI, France, Internet of Things, IoT, LAN, M2M, Machine-to-Machine, modules, power, PSTN, Satellite, Sigfox, Toulouse, tracking, ultra narrow-band, UNB, WAN | Permalink
Posted by magnusmelander
September 17, 2012
The recent announcement from AT&T that they will shut down their 2G network latest year-end 2016 has been discussed a lot lately. It is safe to say that mobile operators in developed markets will continue transitioning their handset users and networks towards 3G and 3G LTE. But mobile operators in general have a growing number of M2M terminals in their networks and they know that over 90% of them are using 2G modules today. Many of them are recently deployed and expected to run without intervention for maybe another five to ten years. Going there, changing SIM, terminal or in worst case the entire device is a very costly thing to do. This is probably why mobile operators in general don’t talk about when they plan to terminate their 2G networks. And I don’t think we will see many announcements like the AT&T one for the next few years, especially not in Europe. Also, let us not forget that many operators in developing countries only have 2G so it will definitely be around for quite some time.
Over the air provisioning of SIM-cards will solve some of the 2G sunset problems but if you need another module in your terminal it will obviously not help. One or two operators in a market, or why not an MVNO, can gather all the 2G terminals and continue service them until the bitter end. The remaining operators would lose some clients but free themselves to go wild on 3 and 4G.
More and more new M2M solutions are using 3G and 3G LTE now. This is natural especially when applications are data rich and require low latency. At Qualcomm IQ last week in Berlin, Steve Mollenkopf, President & COO Qualcomm, stated that one million new 3G connections are added each day. Most of them are not M2M but it means that 3G network capacity and coverage is rapidly improved around the world. And modules and components are coming down in price as volumes grow. And even 3G LTE is spreading. According to Global mobile Suppliers Association (GSA) 96 operators have launched commercial LTE services in 46 countries so far. But the recent announcement of iPhone 5 reminds of the fragmented frequencies of 3G LTE which needs to be taken into account when looking at a specific M2M 3G LTE solution. 3G LTE uses frequencies between 698 MHz – 3800 MHz, divided in 25 bands for FDD (Frequency division duplex) and 11 bands for TDD (Time division duplex).
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Posted by magnusmelander
August 8, 2012
AT&T just announced that they will shut down their 2G network no later then January 1 2017. They want to free up spectrum for mobile Internet network capacity. “Well in advance of this change, we will reach out to our relatively small percentage of 2G customers and offer them options to meet their needs” says a spokesperson to Fierce MobileIT. According to Berg Insight AT&T had 13.1 million M2M subscribers by the end of 2011. It is often stated that the 2G share of the M2M subscriptions are bigger then 90%. I don’t know the AT&T mix but it is likely that at least half of their 13 million subscribers use 2G.
PricewaterhouseCoopers recently made a study and found that 60 percent of wireless operators plan on decommissioning their legacy networks over the next five years. Their study would suggest that more operators would like to make similar announcements as AT&T.
M2M terminals are often expected to be operational 5-10 years which makes the choice of network technology difficult. From a capacity point of view 2G is often enough and 2G modules are cheaper than modules supporting 3G and 4G/LTE. Coverage of the 3G networks are often not as good as the 2G networks. It is far too early for LTE networks to take over. Support for circuit switched connections which are required when moving terminals from the fixed phone networks (PSTN) to mobile networks is only available in 2G. It will be interesting to see what AT&T’s announcement will do to customers, regulators and other mobile operators. And what about countries were mobile networks are all 2G?
I believe this is a challenge for the development of the M2M market. As far as I understand it, AT&T will have to subsidize the remaining 2G M2M customers to replace terminals or loose the customers to other operators. This new situation for ongoing and planned M2M projects might delay or in worst case kill them if the up-front investment becomes substantially bigger. This news also explains why M2M customers need over-the-air provisioned SIMs.
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3 Comments | M2M, Networks | Tagged: 2G, 3G, 4G, AT&T, B3CC, B3IT, CSD, Internet of Things, LTE, M2M, PSTN, PwC, SIM | Permalink
Posted by magnusmelander
April 24, 2012
Services like Skype and Spotify utilizing the Internet just as a connection are often referred to as over the top services or OTT. Consumers normally love them but operators typically have a more complex view of them: great since they create demand for their IP services but not that great if they replace services the operators charge for. Most M2M applications are really tiny in terms of traffic generation which explains why over 95% of the mobile ones still use 2G. For mobile operators M2M is more of a subscription business than a data business today. It is hard to estimate how M2M solutions will impact data volumes since it’s a combination of actual applications and volumes of connected devices.
I always claim that the M2M consumer market is a great place to look for innovation and interesting examples to bring to the business market. One example is what could be referred to as M2M OTT, where vendors of connectable devices use people’s ordinary mobile devices to connect to the Internet and an application in the cloud or elsewhere. This can make the device cheaper and smaller to manufacture and use. By using for example Bluetooth to connect to the phone and leverage the existing subscription and data plan. Data from the device can be made available to an application somewhere typically adding no cost to the user. And no new revenues but more traffic to the operator. There are many examples of this in the consumer market today and the personal health and fitness segment is one worth looking at. A mix of books, trends, research, services and products has created a rapidly growing movement and industry. Dr David B. Agus’ bestseller “the end of Illness” and the sleep monitor Zeo are good examples. The Zeo is a complete system taking sleep analysis out from the labs. By connecting a Zeo headband to an iPhone or Android phone via Bluetooth, the sleep data collected is made available to an app for reporting. But the sleep history data is also made available to the user’s account at mysleep.myzeo.com where analysis, backup and other services are available.
Using the mobile devices for local collection and presentation of data and access, over the top, to an application and services in the cloud is a model we can use in other situations. There are obviously downsides having to deal with Bluetooth, phones running out of power or stolen etc. But for some applications this is a great model maybe also in the business environment. There is simply not one or two models for M2M but many, and it is important to carefully look at all possible approaches available when implementing an M2M project.
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Leave a Comment » | Cloud computing, Consumer market, M2M, Networks | Tagged: 2G, Agus, Android, apps, B3CC, B3IT, Bluetooth, Internet of Things, IoT, iPhone, M2M, Machine-to-Machine, OTT, over the top, SIM, smartphone, zeo | Permalink
Posted by magnusmelander
January 31, 2012
“I would say that 2G is not going away anytime soon, but if you are concidering new M2M installations today I would definetly recommend going with 3G compatible devices and to use 2G/3G compatible SIM cards. There is no guarantee of a maintained functionality in 2G networks looking ten years down the road (a normal life span for many M2M installations), and 2G CAPEX and OPEX will decline with all operators. Even if you take a slightly higher investment initially using a 3G device you will avoid the risk of having to exchange both SIM card and modem during the life span of your installation. Besides, prices on 3G modules are dropping and are rapidly approaching similar price levels as 2G units. This is of course dependent on the life span of you M2M installation and the amount of data you need to transfer. From an operator point of view, I am curious of which industry will first make use of 4G networks and M2M to rapidly transfer streaming video for specific surveillance tasks or other data intensive applications.”
Martin Svensson, M2M Product Manager, Tele2
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1 Comment | M2M, Networks | Tagged: 2G, 3G, 4G, B3CC, CSD, Internet of Things, IoT, M2M, Machine-to-Machine, Tele2 | Permalink
Posted by magnusmelander
January 29, 2012
Today some 95% of the mobile M2M connections are 2G. It is absolutely natural since the functionality and capacity needed for most of today’s applications is fulfilled in 2G and the modules are substantially cheaper. An off the shelf 2G SIM card would cost around $3-4 per month plus $0,5-2/MB data transmitted (in Sweden) and CSD, GPRS and SMS is enough for most M2M applications today. But there are dark clouds in the horizon! We don’t know how far away or how fast they come forward, but they are definitely there. Let’s try look at what these clouds contain.
A typical M2M deployment would count on terminals to be in service more than five years, often 10 or even 15 years. That’s long time! It is about 20 years since the GSM services came to market, and betting on the same networks to still be there with great coverage and good service might be something to consider carefully. A customer service person at my previous mobile operator in Stockholm told me: “sorry but we don’t invest in the 2G network anymore”. One of my companies, Possio, help mobile operators to move analog devices from the fixed network, PSTN, to mobile networks using primarily circuit switched connections in 2G (CSD). They experience operators, one by one, deciding not to introduce any new CSD based services in their network. They keep the existing ones, but obviously not for ever. I believe CSD will not disappear over night but this is worth looking into when making the bets
The connect part of M2M is the least interesting and rewarding. It is the compute part that makes the difference. IP is today, by all means, the dominating communication platform across all industries. The IP development environment is solid and rich, application support endless and skill is really everywhere, from developers to support people. An M2M bet today should in most cases be built on IP and one should really try understand if performance in 2G GPRS/EDGE will be enough for making all wanted computing during the life cycle. It is easy to foul yourself when it comes to performance and capacity. My first business trip with IBM went to Copenhagen 1983 where serious old men unanimously stated that with this capacity nothing is stopping us any longer. This was an ISDN conference.
The end-of-life problem is always something to take into account. Module manufacturers normally bring to market new pin compatible modules for their most popular models. But one day they will issue an end-of-life notice and then it is last order date and finally the spot market to rely on before it is over. In other words, when a market decrease it’s a chicken race between the module vendors. They not only want to understand how fast the market disappears (remember they have good numbers to watch) but they also want to ensure the best moment to bring their customers forward on a new platform and not lose them to a competitor.
The cost of modules for 2G or 3G differs a lot. As of today a 3G module would be roughly double the price of a 2G module and the difference could be $25-30. That is a lot especially if you need many. But it is important to look at the entire cost envelope, both capex and opex, over time. The cost of the actual deployment is normally high since it takes human beings to prepare the installation, to ensure other people involved are available, to get and verify permission for entrance and finally to go on site. Each installation is obviously different depending on industry, security levels, distances, type of application, etc but it can easily take a couple of hours per terminal which would translate into hundreds of dollars. One of my companies is active in retail environments where they often experience a lot of problems especially with access permission and coordination with other people needed (electricians, operator staff, alarm staff, etc). This is why we need to get it right first time – we can’t afford to go back – and why the installations will have to be operational for many years. When planning an M2M solution this might well be the most important aspect of the business case and the biggest risk for failure.
I believe this question – should I stay or should I go – is very important for all of us in the M2M business. There are no generic answers to the question about going 2G or 3G but it seems inevitable that sooner or later 3G will be the primary network why focus and investments thus quality and coverage in 2G networks will erode. How fast this happens is of course also depending on geography. In order to put more light on this important question I will ask a couple of knowledgeable individuals from within the industry about their views and post them here.
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1 Comment | M2M, Networks | Tagged: 2G, 3G, B3CC, B3IT, CSD, Internet of Things, IoT, isdn, M2M, Machine-to-Machine, modules, networks, Possio, PSTN | Permalink
Posted by magnusmelander
December 14, 2011
What networks are used for M2M applications today? We know a lot of applications use the fixed network (PSTN) but I lack data on that. I visited a friend with a quite small but modern grocery store the other day and beyond the main connection provided by headquarters for cash registers, computer systems, telephony etc, he has three separate PSTN lines to his shop: one for a video surveillance system, one for recycling machines and one for an alarm. When talking to a friend at a fixed line operator recently he mentioned that they have energy companies with water power plants with thousands of PSTN subscriptions for level gauges.
The 2G networks are by all means the most utilized mobile networks for M2M today. Beecham Research claims over 95% of M2M applications use 2G today. Good coverage, reasonable prices, limited capacity required, affordable modules and history explains this situation. And despite push for 3G from vendors and operators, not a lot is happening except for some specific applications. Vendors obviously want to sell new products and some operators want to re-use 2G spectrum or move users for other reasons. For people developing or operating an M2M solution a key question must be to understand when the time is right to change from 2G to 3G (if ever) and how to implement the change. A clear detailed roadmap could be a competitive edge for an operator. Interestingly enough some, primarily vendors and operators, already claim 4G is the way to go for M2M.
Most of Ericsson’s modules business ended up in ST-Ericsson some years ago and they re-entered in 2007 to provide cost effective broadband modules to be built into PCs. Quite silently they announced the end of their broadband modules business in December 1, 2011. The reason provided for the exit was: “our position on the market does not provide the scale we need to achieve the desired profitability”. I believe the actual size of the market for 3G modules also is part of the explanation. ABI claimed last summer: “USB configurations are outselling embedded modems by a ratio of more than three to one” and expected USB configurations to stay bigger until at least 2017.
3G has been around for some ten years now and in dense populated areas it is heavily utilized and 4G is starting to be deployed. But in rural areas most people relay on 2G (some even don’t have 2G) and in some developing countries they haven’t even started to deploy 3G yet. In the end of the day it is market requirements that decide when and to what extent networks will be built, upgraded and utilized, not operator or vendor desire. Still today most M2M applications don’t need much more than decent connectivity (I don’t include Pads, tablets and Smartphones in M2M), and for these to go 3G we need competitive coverage, prices and module prices compared to 2G.
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Posted by magnusmelander
In August 2012 AT&T announced that their 2G network would be shut down latest January 1 2017. This was somewhat surprising to me since roughly 90% of all M2M devices connected to mobile networks used 2G. (https://connectcompute.com/2012/08/08/what-will-be-the-impact-on-m2m-of-announcement-to-shut-down-2g/) Given that 3G is something of a compromise I would have believed that 2G and 4G would be a better bet – one with cheap modules, low bandwidth and great coverage and one focusing on data intensive terminals and applications.
connectcompute 