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Joe Madden |
The LTE market, over the past 20 years, has developed like the market for jumbo jets or nuclear power plants. Four major suppliers and one standard dominate the market because all customers have essentially the same requirement.
The IoT market will look more like the automotive market, where millions of customers demand thousands of product variations. Every driver has specific preferences and expectations. Most IoT applications today prioritize cost and battery power, not data rate or reliability. However, new applications are emerging with a completely contrary point of view. So, for IoT, the question is not "which standard will win", but "what market share can each approach capture?"
The LPWA standards are off to a good start with networks in the field in many countries, dozens of active customer scenarios, and millions of client devices already in service. Competing standards include: SigFox, LoRa, Weightless, RPMA, UNB, and others. These options vary in their range, capacity, and cost, but all are geared toward low data rates, long battery life, and very low cost. The proliferation of standards is natural for LPWA, because each proprietary standard is promoted by a different company. It's a familiar scene: we will see some start-ups boom, while others go bust.
Supporters of 802.11 Wi-Fi standards offer a few choices, including 802.11ad, 802.11 ah and 802.11af. Each of these variations addresses a distinct market need:
- 802.11.ad targets high data throughput (north of 1 Gbps) at 60 GHz;
- 802.11af targets white spaces in television spectrum, where higher power can be used for longer range than other Wi-Fi standards;
- 802.11ah uses unlicensed 900 MHz spectrum for short-range IoT connectivity.
Looking at these options and the overall evolution of Wi-Fi for broadband connectivity, these three variations are sensible. Standardized unlicensed options such as Wi-Fi and Bluetooth, as well as variations on 802.15.4 (Zigbee), will do very well in short range applications. These ecosystems are naturally Darwinian; they will all align themselves with whatever works in the real world.
The LTE crowd needs a shot of Ritalin. The 3GPP committees have been hyperactive for the past year, adding new options far more quickly than the market can absorb them. Mobile standards for IoT/M2M include:
- GPRS
- EDGE
- WCDMA/HSPA
- LTE Category 4
- LTE Category 1
- LTE Category 0
- LTE Category "Minus 1" (sometimes called LTE-M or Release 13)
- Extended Coverage GSM (EC-GSM)
- Narrowband IoT (NB-IoT)
- 5G IoT
Depending on which ones you like to count, there are between 7 and 12 IoT standards to choose from in the mobile market. Somebody recently called this "reheated alphabet soup", and I agree, that's a perfect description. At least four of these options are active in 3GPP committees today, but all of them are incremental steps, not big enough leaps. All of the 3GPP options occupy the same market niche: Relatively high data rate, with good reliability at a premium price. Come on guys— somebody needs to have the guts to kill a few of these options to save time for all the engineers out there.
Here's my point: The mobile standards will certainly have a place in the market because of the high quality of GSM and LTE links, and the huge global network of infrastructure that can be used. But having so many options does not guarantee higher market share for LTE vendors. They're still missing the low-data, low-cost tier of the market, where most of the big applications are today.
In the end, LPWA vs. LTE is a question that will come down to multiple answers. But having an LTE lineup of Porsches, Ferraris, and Lamborghinis will only appeal to a small audience. The world needs a few sports cars, some pickup trucks, fleets of cheap sedans, and countless bicycles.
Joe Madden is Principal Analyst at Mobile Experts LLC. Mobile Experts is a network of market and technology experts that provide market analysis on the mobile infrastructure and mobile handset markets. He provides market forecasts for handset, DAS, small cell, and base station markets, with in-depth research down to the nitty gritty details of frequency bands and power levels. Mr. Madden graduated, cum laude, from UCLA in 1989 and is a Silicon Valley veteran. He has survived IPOs, LBOs, divestitures, acquistions, and mergers during his 24 years in mobile communications.