What IoT strategies do global operators have?

After several years of preparation and development, the concept of the Internet of Things has been rapidly recognized around the world and has become one of the core driving forces of a new round of technological revolution and industrial transformation. According to statistics from Strategy Analytics, by the end of 2017, nearly 20 billion IoT and connected devices will be deployed globally, and another 10 billion will be added in the next four years. Chinese operators who have already incorporated the Internet of Things into their development strategies need to understand the deployment of the Internet of Things around the world in order to optimize resource allocation and seize the opportunities of the Internet of Things.

Network deployment has its own characteristics

At present, the construction of the entire international Internet of Things presents the characteristics of the joint development of eMTC and NB-IoT. As of November 2017, there are 28 mobile Internet of Things commercial networks in the world. Among them, five operators including AT&T and Verizon in the United States have commercialized five LTE-M networks; operators including Vodafone, China Telecom, China Unicom, China Mobile, Korea Telecom, Deutsche Telekom, etc. have commercialized 23 NB-IoT networks.

2017 was the first year of NB-IoT commercialization. China Telecom and China Mobile successively completed the construction of the world's largest NB-IoT network. China Telecom proposed to build a smart connection ecosystem during the 13th Five-Year Plan period. At present, its IoT ecosystem has taken shape. In May 2017, after a series of work such as early layout, standard tracking, field trials, version release, and commercial deployment, China Telecom officially announced the construction of the world's first NB-IoT commercial network.

China Mobile has proposed a "big connection" strategy. In 2017, the net increase in China Mobile's IoT connections exceeded that of personal and family connections, accounting for 61.8% of the total net increase in connections, becoming the primary driver of the growth in connection scale. According to the plan, by the end of 2017, China Mobile had achieved continuous NB-IoT coverage in 346 cities.

Companies such as AT&T, Verizon, KDDI, and NTT DoCoMo have all launched eMTC commercial services. As early as 2015, AT&T proposed the strategic vision of "connecting people's lives, work, and entertainment to the world, and making the connection the best possible." In early 2017, AT&T announced the launch of a nationwide LTE-M network and LTE-M package plans, with monthly charges starting at as low as $1.5 per device. Annual plans, multi-year plans, and plans with more devices will receive even greater discounts. Verizon announced its global strategy for the Internet of Things in 2015. At the end of March 2017, Verizon launched the first nationwide commercial LTE-M network in the United States, covering an area of ​​2.4 million square kilometers. Its packages are set at a minimum of $2 per device per month, and provide customized options for bulk activation and bulk purchase.

Actively explore business expansion

The popularity and maturity of IoT applications in different industries have promoted the development of IoT. Wearable devices, smart home appliances, self-driving cars, smart robots, and tens of billions of new devices will be connected to the network. The rise of IoT will drive the intelligent upgrade of industries, automobiles, urban construction, and other fields. Global operators are actively exploring the expansion of IoT business.

The three operators in my country have collaborated with their partners to achieve fruitful results in various vertical industry cooperation areas. In terms of transportation, China Mobile has provided Mobike with a solution based on cellular Internet of Things that allows for more accurate positioning and more convenient unlocking; in terms of energy, it has provided Hong Kong and China Gas with a high-quality network testing environment based on NB-IoT products.

In March 2017, the world's first smart water project based on NB-IoT technology was commercialized in Shenzhen, Guangdong. China Telecom, Shenzhen Water and Huawei jointly released the "NB-IoT Smart Water Meter White Paper"; in June, China Telecom released the Internet of Things open platform to the world in Shanghai, and joined forces with global industry partners to jointly achieve global "product integration, channel linkage, and results sharing"; in July, in Xiongan New Area, the NB-IoT-based smart city management application demonstration site was fully built and officially put into use.

For AT&T and Verizon, the IoT business is penetrating into more and more fields, with industry and urban construction being the focus. In the automotive industry, AT&T has established partnerships with 20 of the world's top 24 automakers, allowing users to get a better driving experience and higher safety; Verizon has acquired a leading GPS vehicle tracking company in North America. In the field of urban construction, AT&T has established a smart city living laboratory in Dallas, where its headquarters is located, using IoT technology to remotely control street lights and using environmental sensors to measure different types of pollutants as well as temperature, air humidity and atmospheric pressure; Verizon has acquired a company that provides smart LED lights, and tens of thousands of LED sensor lamps are connected to form a dense IoT grid through LTE eMTC, forming full coverage of spatial geographic information for the entire city core area and traffic arteries.

So far, the world's five major operators have released NB-IoT packages. China Telecom is the first operator in the world to release NB-IoT service packages. The connection fee = the total number of China Telecom NB-loT connections × the connection unit price of each NB-loT connection. It reflects the value from the connection and abandons the extremely low-value traffic charging model in NB-loT, creating a precedent. China Mobile has launched two affordable annual packages of 20 yuan and 40 yuan. China Unicom's NB-IoT tariff package has two usage methods: VPDN directional traffic and Internet traffic (i.e., general traffic). Deutsche Telekom has launched two NB-IoT service packages: a simplified NB-IoT device connection package with a starting price of 199 euros, including 25 SIM card activations for 6 months, each SIM card has 500kB of traffic, and a comprehensive NB-IoT product connection package, including Deutsche Telekom's Cloud of Things platform, with a starting price of 299 euros. T-Mobile has launched the first NB-IoT tariff package in the United States, which costs $6 per year, 10 single-packet transmissions per hour (maximum rate 64kbps), and an annual traffic limit of 12MB.

The future is promising

GSMA believes that by 2025, there will be 27 billion IoT connections worldwide, of which about 70% will be short-range connections. Specifically, there were 450 million IoT mobile connections in 2016, and this number will reach 5 billion by 2025. Cellular IoT (2G/3G/4G) connections will reach 2 billion by 2025, and LPWA connections will reach 3 billion by 2025. By 2022, 56% of active LPWA connections will use licensed spectrum technology.

Telecom operators are expected to generate up to $190 billion in IoT revenue by 2025. This is nearly 20 times the revenue in 2016. Of these revenues, devices and connections account for only about 20%, platforms and applications will account for 45%, and IoT consulting and management services will account for about 35%. Mchina predicts that among the number of mobile IoT connections in major vertical industries in 2025, connected cars will account for 42%, followed by connected energy 18%, connected industry 13%, smart home 8%, consumer electronics 6%, smart healthcare 6%, etc. my country's operators are ready to strive for the huge benefits brought by the IoT by expanding the scale of IoT deployment and improving the level of IoT application.

Unprecedented opportunities and challenges coexist

Security is increasingly becoming an unstable factor in the process of technology application. With the rapid development of the Internet, IoT networks and devices of important institutions such as electricity, energy, and airports around the world are frequently attacked, and IoT information security "pain points" are emerging. Juniper Research predicts that by 2019, the global data leakage losses will reach 2.1 trillion US dollars, and the IoT will account for a large part of the losses. It is urgent to improve the IoT security system.

Cost has become a major challenge facing smart city projects. Machine Research predicts that deploying IoT solutions without interoperability standards will increase the cost of global smart city projects by $341 billion by 2025; without standardized solutions, the cost of deploying global smart city projects will reach $1.12 trillion, while if standardized solutions are used, this cost can be reduced to $781 billion. The establishment of universal interoperability standards needs to be put on the agenda urgently.

The development bottlenecks and deep-seated problems of my country's Internet of Things market are still prominent. The core basic capabilities such as chips, sensors, and operating systems are still weak, the R&D capabilities of high-end products are not strong, and the original innovation capabilities are far behind those of developed countries; the lack of industrial coordination is reflected in the disconnection between the market and the industry, between the upstream and downstream of the industrial chain, and the lack of leading enterprises that integrate upstream and downstream resources and lead the coordinated development of the industry.