Internet of Things (IoT) is a term we use to define connected devices that, with the help of sensors, can collect data from their surroundings, process the data to some extent, and send it to an application for further processing. While an endless collection of IoT use cases have been imagined for decades, many of these use cases were not practical given the high complexity and high cost of IoT implementation. As an industry insider looking into the rear-view mirror of the industry exposes a somewhat tarnished view and a higher percentage of IoT project failures than we would like. So, what are we left with? An over-hyped industry with an overly cautious, if not gun-shy, customer base with little hope of reaching their digitized solution dreams. In short, my opinion is NO.
While we cannot change the past and the memory of many early adopters failed IoT projects will continue to haunt us, I believe the ghosts of IoT past failures can be used as a teaching opportunity for the new adopters as we shift our focus from the rear-view mirror toward a more promising front windshield. Before we look forward, let’s reflect on some of the biggest obstacles of the past.
Complexity – Many Product and Solution companies who embarked on their IoT journey in the early days were met with both a skills and knowledge gap. It is understandable that a company that was an expert in electrical generator technologies, combustion engines, or transportation logistics would likely have little to no experience in telecommunications and wireless technologies. This knowledge and experience gap led to many unforeseen challenges and delays during IoT project implementation. This knowledge gap resulted in large consulting companies as well as Mobile network operators establishing centers of competence teams to assist customers in their journey. While the assistance was a noble gesture, their support was usually targeted to the most strategically important or largest customers.
Not only was there a significant knowledge gap there existed challenges in global network availability. At the beginning of M2M or IoT, most mobile networks supported 2G technologies. While 2G seemed like long ago, there was a lot less churn in the networks and, therefore more stability for the developer. This stability was soon rocked with the emergence of new and needed standards which supported 3G, 4G, LTE, and soon 5G.These high-tech additions to the network created an increased level of complexity for adopters, forcing them to select the right technologies for the right geographies and networks. While none of these complexities were insurmountable by the tenacious and well-financed customers, these complexities created an increasing level of resistance to the innovation that IoT promised.
Cost – The complexity of IoT, as well as the early communications standards, which were based on cell phone and other network technology, was expensive. Connecting a consumer smartphone for a hundred dollars or so a month was great business for the mobile network operators, but how can you use the same technology to connect IoT sensors at a cost which was targeted to be about 10o times less. The bottom line is that this objective was nearly impossible to do. While mobile network technology evolution moved quickly to support higher bandwidth to support smartphone and streaming media needs, the costs of IoT implementation began to increase. Cost increases were immediately recognized when sourcing hardware and radios needed to support the new mobile technologies. Bill of material costs was just the start. New technologies and their associated data plans were increasing as well as the energy needed to drive the technologies was also growing. The result was driving new and usually more expensive battery technologies or more costly maintenance events to maintain the battery systems for many IoT solutions. The bottom line is that changes needed to be made… The good news, change was on the horizon and was being driven by both unlicensed options like LoRa as well as emerging Mobile Network standards that support Low Power and lower data plan offerings like Narrow Band IoT (NB-IoT) and LWM2M Protocols.
Consumer Resistance–Operation teams and other key consumers of new and creative IoT Services were often threatened by the fear of the unknown. One could imagine that the use of IoT solutions would mean a new way of working. For many operations and maintenance workers, IoT could be viewed as threatening and perhaps eliminating elements of their jobs. The use of IoT solutions would force changes in KPIs, measurements, and metrics. For example, a field service executive managing a 100 vehicle and driver operations is considered a level of success by an operations manager; how would they adjust to managing half the capital needs and relying on technology and remote monitoring to achieve the same results? Was this a reduction in their scope based on legacy measurements?
With all the history of challenges, we see in the rear-view mirror, what has changed to make everyone feel confident going forward? The answer to this question is not short and simple because many things have indeed changed to reduce, if not eliminate, many of the early IoT impediments.
Improvement in Standards and Technology
Implementation of new and more comprehensive standards has been established specifically for IoT over the last five years or so. These standards were focused on reducing power consumption and reducing bandwidth needs for the simplest and highest volume IoT use cases. As these new standards were being developed, the competitive unlicensed networks such as LoRa were being rolled out in both Private deployments as well as select Mobile Network operators deployed regional or national LoRa networks. The good news for the IoT sector was the developing availability of Low Power IoT Networks and Technologies.
The emergence of Low Power Wide Area (LPWA) network technologies addressed the needs of IoT applications which usually involve a large number of devices and wide area use cases. The requirements of LPWAN applications can be summarized as follows:
- Low Cost (CapEx & OpEx)
- Small Form Factor
- Low Energy Consumption
- Long Distance Connectivity (including challenging locations)
- High Capacity
- Strong Security
Generally speaking, only those who meet these requirements will be economically successful in the deployment of large-scale IoT projects. The LPWAN technologies provide the ability to deploy a large volume of battery-powered, low-cost, constrained devices covering a wide area, including challenging urban and rural terrain. These IoT applications are also referred to as massive IoT applications.
Improvement of IoT Networks
Even though LPWAN technologies provide necessary tools for massive IoT applications, the connectivity landscape is still very fragmented. No connectivity technology has ubiquitous coverage. When it comes to the spectrum used for LPWAN, we can talk about two options: licensed and unlicensed. The licensed spectrum is the cellular connectivity provided by the Mobile Network Operators (MNO), which own these spectrums for which they have paid billions of dollars in auctions to their governments. The LPWAN technologies used for cellular IoT applications are mainly Narrow Band IoT (NB-IoT) and Long-Term Evolution for Machines (LTE-M) within the 4G standards specified by 3GPP and the emerging 5G New Radio (NR).As these licensed technologies took time to mature, we saw several unlicensed technologies emerge to fill the need. Unlicensed technologies typically use the regional ISM frequency bands.
On the unlicensed spectrum front, there have been many proprietary radio frequency solutions provided for various niche Machine-to-Machine (M2M) applications for a long time. Within the last decade, several standards have emerged as leading LPWAN technologies, LoRa being the most prolific. While other technologies such as Sigfox have been available to the market, the open standard LoRaWAN protocol has become the dominant non-cellular technology. ABI Research predicts that by 2026 LoRa will account for over a one-fourth share of all LPWA network connections and more than half of all non-cellular.
While the unlicensed technologies were being deployed in controlled private networks at the beginning of their lifecycle, we have seen a shift over time toward more national deployments. According to LoRa Alliance’s 2021 End of Year Report, coverage grew exponentially in 2021. LoRaWAN is now being offered by 166 network operators in 177 countries. The fact that in 2021 LoRaWAN was accepted by ITU as an international standard will further help its adoption.
Improved Business Drivers – Digital Enterprise
In the early days of IoT, when the challenges of the past were harder for enterprises to successfully create their own IoT projects, we saw many end-to-end IoT applications created. Picking a turnkey IoT application which preselected a device, a network that was matched to the application was an easy way for enterprises to start their IoT journey. The challenge with using a multitude of single-use case, end to end IoT applications was integrating these applications into their enterprise processes. Single-use applications were often not as flexible when it came to integrations or modifications that were required by the enterprise customer.
Over the last five years or so, the application of IoT technology has become a vital part of an emerging need to create a comprehensive view of the emerging DIGITAL ENTERPRISE.A term that started to roll off the tongues of all the high-value consulting companies. IoT was never the value application. IoT was really a necessary component of most next-generation enterprise solutions. This shift from being the application answer to being a necessary contributing component of enterprise process re-engineering programs further increased the need to get away from the IoT turnkey applications and move toward enterprise deployment of IoT Sensors and devices and ingest the valuable real-time data into their primary business systems used by the enterprise.
Hyperscale Cloud and Low Code Tools
So,if Low Power IoT technologies are becoming readily available, what is the next set of obstacles that were overcome in the last five years or so? While the LPWAN technologies we discussed enable connectivity for high-volume, low-cost devices, it is a big challenge for developers to ingest data to their hyper-scale cloud applications from billions of devices in a Multi-RAN(radio access network) environment.
What has happened in the last few years is the rise of Hyperscaler Clouds such as Microsoft Azure and the marginalization of first-generation IoT Platforms. The result is a need to support today’s developers with developer-friendly low code tools which help bridge the new LPWA networks to the global enterprise accepted and ever-growing hyperscaler clouds.
The result of these two converging mega-trends has put the power of real-time IoT data into the hands of every cloud-capable and enterprise solution developer, who will lead to innovative applications that will harness the power of real-time IoT data, Digital Twins, Machine Learning, and Artificial Intelligence enabling sensor data to be transformed into the insights and digitized processes used by business leaders across every industry.
Positive Changes in Buyer Behavior
Perhaps the most unexpected but almost undoubtedly the most instrumental IoT Market accelerator has been the Global Pandemic, which we have lived through. The effects of the Covid-19 pandemic shattered any resistance enterprises, or consumers had with new IoT use cases. Our inability to travel to remote locations to diagnose or service equipment quickly replaced the alternative of IoT-enabled remote access alternatives. Those companies who had been early proponents of enabling their solutions for remote monitoring and remote support were able to quickly pivot from a field employee-centric model to a remote access-centric model. This quick pivot allowed remote “home-based” technicians to continue servicing equipment and remote clients with very little incremental effort. Conversely, those companies who were not ready for the pivot became painfully aware of the competitive disadvantage they faced.
As the pandemic began to loosen, the companies who recognized their disadvantage began initiatives to improve their position. The economic and competitive pressures of creating remote access, monitoring, and other IoT-based solutions was accelerated by the soon recognized shortage of human capital. As if human capital and mobility weren’t enough, we were thrust into a Global supply chain crisis which has driven the desire to improve supply chain visibility. Guess what?… IoT solutions for supply chain and asset tracking are now desired for most valuable or important shipments, whether local high-value transportation solutions or global cargo and shipping container tracking. As a result, the Covid-19 pandemic created the perfect set of circumstances to eliminate consumer resistance as well as create new use cases, all of which have led to IoT’s increasing adoption curve within the enterprise.
Emerging Satellite enabled IoT Networks
Not only have the megatrends of the last five years changed the trajectory of IoT-based solution adoption, but we can look on the horizon or actually above the horizon to gain even more confidence. Today’s IoT solutions have predominantly been deployed where land-based networks have existed. Well, thanks to advancements in Satellite technologies and further advancements in IoT standards, we can look forward to affordable global coverage of LPWAN IoT networks due to the heavy investment and promise found in the small form factor IoT purpose-built cube satellites which are being deployed over the next couple of years. Global coverage of LPWAN IoT coverage provides the building blocks to create even more novel IoT solutions for supply chain, conservation, and environmental monitoring, just to mention a few.
Conclusion
Hopefully, the short look into IoT’s rear-view mirror as well as a clear look out today’s front windshield has provided reasons to become bullish on the near-term IoT market outlook. While part of the confidence has come from the timely evolution and implementation of device and network standards coupled with the growth of hyperscale cloud services and applications such as machine learning and Artificial Intelligence to process the vast amount of IoT data. The balance of optimism comes from the changes in buyer behavior and reduced resistance, not to mention the perfect storm of pandemic unintentional IoT consequences. Hopefully, today’s developers, whether focused on achieving a higher degree of enterprise operational efficiency through IoT-enabled digitization or perhaps an up-and-coming innovator with the next big idea, will be left with increased confidence to accelerate their IoT-enabled journey.
For those who are looking for a bit more guidance as they begin their IoT journey, I would always recommend seeking advice from those who have traveled before them. Many of today’s ecosystem participants have overcome the prior challenges discussed and understand the impending positive changes that we see in the IoT space. As such, I would encourage new entrants to the IoT domain to partner with suppliers who have the experience and wisdom to help realize your IoT-enabled dreams. Enjoy the Journey!
