Which of the following are likely to be factors in choosing a network technology for an IoT device?

Selecting the most suitable connectivity technology is one of the critical decisions that enterprises need to make in their IoT launch strategy as reliable connectivity is a key component in an IoT solution. Find out more in our report.

This decision can impact the success of the service as a poor choice can result in inferior performance or higher cost in the short-term, and in the long-term it can hinder scalability or necessitate an expensive swap if the technology is not sufficiently future proof.

Report: Connectivity Technologies for IoT

This report guides companies towards the optimal choice for IoT connectivity.

What are connectivity technologies for IoT?

Traditionally, the IoT landscape or rather the machine-to-machine (M2M) communication has been dominated by radio technologies such as ZigBee, Bluetooth and Wi-Fi for short range local area networks, and traditional cellular such as 2G/3G/4G for wide area networks, with 5G having recently been added to the latter. Many of these technologies, especially Wi-Fi and 2G/3G/4G/5G were originally designed for consumer and business voice and data services.

Over the past years IoT devices have evolved from test-bed technology for futuristic use cases to a core enabler of operational improvements, product enhancements and customer satisfaction. Many IoT use cases entail a range of technical, commercial and ecosystem related requirements. Enterprises therefore need to consider suitable connectivity technologies as enablers of end-to-end IoT solutions. This decision is critical to the commercial success and total cost of ownership (TCO) of the service. Poor technology choices can result in inferior performance or higher cost in the short-term and hinder long-term scalability and future-proofness.

Since the first edition of this report the landscape for IoT connectivity technologies has changed rapidly. Traditional cellular technologies primarily aiming at consumer use cases have expanded to 5G while new cellular and proprietary Low-Power Wide-Area (LPWA) technologies have been developed specifically for IoT applications. The new landscape of IoT connectivity technologies is thereby able to address a whole new complexity and scale of IoT use cases. Which connectivity technology is most suitable for different use cases depends however on the technology requirements of each specific use case.

Our analysis identifies and groups these technology requirements into three categories – technical, commercial and ecosystem-related, thus providing a structured approach that enterprises can use to analyse their particular needs:

• Technical requirements – coverage, energy efficiency, data rate, other features relevant to specific applications (mobility, positioning, latency, density);
• Commercial requirements – TCO, reliability, security, scalability;
• Ecosystem requirements – future-proofness, global reach and interoperability.

No single technology is ideally suited to serve all potential IoT use cases and certain technologies will co-exist as complementing rather than competing standards. Currently, there are various actors within these technologies that aim to establish their market dominance and ecosystem. This fragmentation in the industry will consolidate in the long run to a few leading actors.

According to our analysis, LoRa, NB-IoT and LTE-M are good complements for IoT deployments in remote/wide areas, and will together address a large share of this market. The dynamic open ecosystem of LoRa is ideal for private networks with customised deployments, while NB-IoT and LTE-M are backed by major mobile operators offering standardised connectivity with global reach. Other proprietary technologies like Sigfox may address certain niche segments but whether or not they are future-proof remains to be seen. For applications requiring a high data rate, the most suitable technology options are either 4G, 5G, Wi-Fi or Bluetooth Low Energy (BLE), depending on the scope of the IoT deployments. 5G specifically will create new possibilities for emerging use cases with an array of complex requirements, e.g. autonomous vehicles. For local short-range applications, the choice of connectivity technology is less obvious and often the interface and implementation of platform and application layers are most critical. Finally, this paper provides some case studies and discusses the needs of various application areas, such as automotive, industrial manufacturing or utilities in order to illustrate which technologies can be best suited to serve those needs.

The Internet of Things (IoT) is transforming many industries and will create value for both businesses and their customers. This paper aims to provide a structured approach that enterprises can use to analyse their requirements for connectivity technology, deliver insights about the connectivity technologies available and how they can serve the needs of specific application areas and use cases.

Connectivity technology in the context of IoT launch strategy

Selecting the most suitable Internet of Things connectivity technology is one of the strategic decisions with long-term implications that enterprises need to make when deploying IoT. The Internet of Things journey typically starts with defining the vision and objectives – these can be to increase revenues by enabling new services and business models or to decrease costs in internal production processes and within the supply chain. The main question to ask is how the connected product and the data generated are going to be used and deliver value to the enterprise and its customers.

After defining both the strategic and financial objectives and impact, enterprises can proceed to identifying technology requirements and select the most suitable technologies and vendors. As illustrated in Figure 1, deploying Internet of Things entails securing an end-to-end technology solution that includes hardware (device, components), connectivity technology, platform and applications (software), often brought together with the help of a system integrator/technology consultancy.

Each of these components is important and carries its own requirements. In this paper, we focus on providing insights and analyses regarding how enterprises can select the most suitable connectivity technology among several alternatives such as traditional cellular (2G/3G/4G/5G), a range of low-power wide-area (LPWA) options, Wi-Fi and more.

Every use case has specific characteristics and needs that translate into certain technology requirements – technical, commercial and ecosystem-related. We have identified and described these major technology requirements in the next section of this paper. For example, enterprises may have products which are:

• Simple sensors that deliver small amounts of non-sensitive data with low requirements for security, but need for low cost to deploy and manage a large number of devices in close proximity;
• (Part of) sophisticated machines that need to report data and be monitored, upgraded and maintained remotely, with the need for a high level of security and to be future-proof for 5-10 years, while potentially operating in places hard to access.

For some use cases the choice of technology can be very straightforward, while for others the enterprise may need to choose among a number of technologies that can in theory satisfy the needs, but likely with different trade-offs.

What is an IoT network?

An IoT network refers to a collection of interconnected devices that communicate with other devices. This has enabled devices to function without the need for human involvement. An Internet of Things network can be in relation to autonomous cars, appliances and wearable tech.

The importance of choosing the right connectivity technology

Selecting the right connectivity technology (and vendor) can impact the commercial success both in the short and long term, which is why both perspectives should be considered. In the short-term, a poor choice can result in inferior performance or higher cost than budgeted; in the long run it can hinder scalability as device numbers increase or devices necessitate an expensive swap if the technology does not show to be sufficiently futureproof to support long product lifecycles.

There are currently a range of fragmented technologies available for Internet of Things based on both licensed and unlicensed spectrum. The current fragmentation is however not viable for the industry in the long-run. We believe that certain connectivity technologies (or players) will emerge as leaders in their category, but no single technology or solution is ideally suited to serve all potential IoT use cases. A number of technologies (and vendors) will coexist alongside, as complementing rather than competing standards. The choice of connectivity technology for an enterprise depends on the specific use case requirements and competitive environment. In any case, a phased approach is recommended, where companies start small and scale gradually.

Traditionally, the IoT landscape or rather the machine-to-machine (M2M) communication has been dominated by radio technologies such as ZigBee, Bluetooth and Wi-Fi for short range local area networks, and traditional cellular such as 2G/3G/4G for wide area networks, with 5G having recently been added to the latter. Many of these technologies, especially Wi-Fi and 2G/3G/4G/5G were originally designed for consumer and business voice and data services.

A number of new radio technologies have emerged recently to connect things that were previously too expensive or too remote to be connected. These newcomers characterised by their low power consumption and wide coverage are generally known as Low Power Wide Area (LPWA) technologies. We divide them into two main categories. The first one is proprietary LPWA such as Sigfox and LoRa, which operate on unlicensed spectrum; they are typically deployed by non-telecom actors but can also be deployed by telecom operators. The second one is 3GPP standardised LPWA (for simplicity often referred to as “cellular LPWA”) such as NB-IoT and LTE-M, which are operator managed networks and operate on licensed spectrum. These technologies were specifically developed to provide a cellular option that addresses the needs of IoT; they were standardised in 2016 and deployments started in 2017.

To choose the right option for a specific Internet of Things application when facing such a diverse selection of technologies, requires an understanding of technology from many different angles. As illustrated in Figure 2, our framework divides the criteria into three main dimensions: technical, commercial and ecosystem related requirements. In the following section we will describe the relevance of these requirements.

Requirements in selecting IoT connectivity technology

Technical requirements

The three main technical requirements for any enterprise looking into Internet of Things connectivity technology are coverage, energy efficiency and data rate. No single technology can excel in all these aspects, as these are trade-offs every radio technology faces (see Figure 3).

Coverage

All IoT applications need good coverage to connect devices but some need to cover only certain indoor areas while others require extensive coverage in rural or remote regions. A technology with long range is better suited to connect devices scattered in a wide area.

Traditional cellular technology, such as 3G or 4G are a typical example of a wide area solution with excellent outdoor device radio range in most urban areas. LPWA technologies further improve the connectivity range by employing more robust coding schemes, which makes them ideal for reaching remote areas and penetrating deep indoors. Short range technologies, such as Wi-Fi and ZigBee, are suitable for connecting many devices deployed in close vicinity.

Energy efficiency

The energy efficiency of a connectivity technology has a significant impact on the lifetime or the maintenance cycle of IoTdevices relying on battery or energy harvesting and is dependent on range, topology and complexity of the connectivity technology. The overall energy consumption of the device also depends on the usage of the application, such as the frequency and duration of message transmission.

Short range technologies like ZigBee rely on mesh topology to forward messages from one device to another over multiple hops. That way ZigBee can extend its coverage but may deplete batteries more quickly as an individual device must constantly listen and be ready to relay messages. Wide area technologies, such as 2G, rely instead on star topology and keep most of the intelligence and complexity at the base station where power supply is not a limiting factor. LPWA technologies, such as NB-IoT, further reduce the energy consumption by stripping down the signalling protocol and reducing the amount of overhead to the bare minimum, thus enabling longer battery life.

Data rate (on up- and downlink)

Data rate requirements for IoT applications vary from hundreds of bit per second (bps) for metering to several megabits per second (Mbps) for video surveillance on the uplink. Furthermore, with the advent of more sophisticated IoT applications, end devices need to be able to receive data packages with sufficiently high speeds, i.e., have high enough downlink capabilities.

Wi-Fi and cellular networks have used large bandwidth and complex waveforms with adaptive modulation rate to support high data rate. But they either consume more power or have a shorter range. In contrast, most LPWA technologies have much lower data rate and lower energy consumption as they employ a more robust modulation scheme and run on commodity-priced micro-controllers with limited bandwidth.

As illustrated in Figure 3, traditional cellular technologies’ strengths lie in data rate (mostly 4G, 5G) and range with complex designs optimised for mass consumer voice and data service; short range technologies like Bluetooth Low Energy (BLE) and ZigBee focus on data rate and battery life at the expense of connection range; LPWA technologies such as NB-IoT, provide superior battery life and coverage, but low data rate on the downside.

Other technical features

In addition to the main technical considerations discussed above, there are other technical features that can be highly relevant for certain applications.

Mobility – in many IoT applications, a device will be installed at a fixed location and paired to a single access point for the entire lifetime, but other applications may require the device to be operational as it moves through the coverage of different access points. While most of the technologies support device relocation to different access points, the relocation process can be as seamless as in the cellular network or occur only at scheduled intervals.

Positioning – device location is often valuable information. But GPS tracking is not always feasible due to its limited indoor coverage and the extra cost and complexity. Therefore, native support for positioning is a desirable feature. Most wide area technologies can use triangulation to determine the device location but the accuracy is rather limited for technologies with narrow channel bandwidth and situations where the device is static without direct signal path. Wi-Fi and Bluetooth are constantly improving their positioning capability as the algorithm is getting more sophisticated.

Latency – low latency is critical to IoT applications relying on remote control and with minimal delay tolerance (latency) of signal transmission. Latency critical applications range from simpler cases like car heaters to very complex cases such as remote surgery, industrial automation and autonomous driving.

Device density – the more devices are connected, the more important it becomes for a connectivity technology to be able to handle large numbers of connections within a certain area. The challenge is to deliver reliable connectivity while minimising interference between the various signals. Typically, device density within the massive IoT (mIoT) context is considered in number of devices per square kilometer.

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Commercial requirements

Total cost of ownership (TCO)

The TCO for an IoT connectivity solution is a function of the module, subscription and deployment and maintenance cost of connectivity technologies.

Module cost

The connectivity module is one of the main components of an IoT device, as illustrated in Figure 4. The connectivity module cost is directly proportional to the complexity of the technology, ranging from sub-$5 LPWA modules to more expensive LTE modules due to their more pricy hardware and IP royalties. It is expected that the price of the latter has potential for further reduction as the deployment volume increases.

Subscription cost

Cost per subscription is charged by a network operator for providing connectivity services. This cost can be zero if the enterprise operates its own private network. The subscription cost for cellular connectivity is mainly driven by the data usage and roaming, but consists of a number of components including the monthly base fee and added services. In either case, however, the complexity of actually deploying and maintaining the respective Internet of Things network brings additional costs into the picture which have to be evaluated separately in order to get the full TCO picture.

This report is written in conjunction with Northstream (a part of Accenture).

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