Should the Telecom companies be “shovel providers “or be “gold miners” in the gold rush of IoT?

Let us do a Google search on the  “Top 10 IoT platforms”

The Top 10 are:

Amazon Web Services  Microsoft Azure IoT, Thing Worx from PTC , Watson IoT from IBM, Jasper from Cisco,, Carriots , Oracle , Predix from GE and KAA.

In my last blog “If Data is Hero then is Device Super Hero ?” I had elucidated the importance of the poor cousin Device when it comes effectiveness of an IoT program sometimes more than Data.

As we talk about device and data, the device “creates” the data and the data has to be “communicated “. The carrier of data is through a Communication/ Telecom Service Provider  (TSP) .

If creation and communication are the two key things in a successful implementation and deployment of an IoT project why is that none of the Telecom companies are in the top bracket when it comes to building and promoting an IoT Platform.

This is something which is intriguing, to say the least, all would agree.

In this list, we have start-ups, equipment manufacturers, software companies, storage companies, business process management companies, and large manufacturing cos. Telecom companies are sorely missed in this august list!!

This is not to say that Verizon with its “Thingspace” and AT&T with M2X are not making headway but more needs to be done to occupy a center stage.

My premise here is –

“Are not Telecom Companies with their inherent capabilities as service providers over decades  natively best suited to lead this rather than be bit players ?”

Let us do a quick fact finding of why this is so. There are primarily two reasons for this –

A ) Telecom companies can provide the following areas of services namely:

  1. As a connectivity provider by providing communication as a service
  2. Help manage devices and their integration
  3. Distribute Content as a service
  4. Provide Maintenance and support through monitoring and control
  5. Help deploy development environment


The following diagram is courtesy

Drawing from the analogy of Gold Rush and if the scale and speed of growth in IoT can be compared to a Gold Rush, while the gold miners are trying to find gold, someone is trying to provide shovels. Today the telecom companies seem to be doing the latter.

They have to shake up their approach from being a connectivity or infrastructure provider to someone providing information value through service enablement and service creation.

B) IoT infrastructure demands are different – the demand for services is from machines/ devices and not humans.

While we could use the term connectivity and communication with a broad brush. We need to get an understanding of the way communication is dealt with IT by Telecom companies and how different the communication needs of IoT ecosystem is.

While IoT ecosystem requires low bandwidth, over a widely dispersed area for a massive number of devices in the field which could be multiple factors of current capacity, the current service needs which Telecom companies address are for high bandwidth in high-density regions with the need for higher power supply.

So, with an increase in the volume of connected devices service providers need to factor in that IoT devices may communicate very differently compared to smartphones and computers mainly manned by humans.

Some IoT devices tend to exchange relatively small amounts of data and connect and disconnect to the network very infrequently. Examples of this are smart meters (e.g. gas or electricity) providing their latest values to a centralized repository. In contrast, a connected car may exchange diagnostics information to this central hub while also offering mobile broadband services for in-car entertainment, thereby exchanging a lot of data over the mobile connection for a longer period of time.

This difference in ‘IoT endpoint’ behavior places very different demands on both the network as well as the data center responsible for processing and hosting this information. For example, a 4G network is very suitable for the connected car use case, but may not be the best choice for the smart metering scenario.

Smart metering only requires a low bandwidth channel that can be accessed with minimal power consumption.

C) Need for Short Range and Long Range Communication in IoT is best addressed by Telecom Service Providers.

Telecom service providers ( TSP) are currently rolling out low-power WAN networks (LP-WAN) such as LoRa or Sigfox which will work alongside traditional 3G/4G networks and which cater to those IoT applications that require very low bandwidth and low power consumption so the battery lifespan of the IoT device can last several years.

On the data center side, adopting cloud technologies is critical. The ability to quickly spin up a virtual environment delivering both the network functionalities as well as the IoT platform functionalities addressing the specifics to each IoT use case is crucial. Indeed, due to the wide variety of IoT use cases, there is no one-size-fits-all approach.

As the promised-land of the Internet of Things approaches, TSP is best positioned to become the facilitators and engine-room of this super-connected world.

Connecting IoT devices is one thing, securing them and securing the applications they connect to is another. TSPs have become much more security-aware in recent years as cyber and DDOS attacks have impacted other areas of their business.

Given that TSPs,

  1. Can handle Short-Range Communication and Long-Range communication through the cloud-based infrastructure and
  2. Have  a better knowledge of handling security and privacy given the years of experience behind them

It would not be a surprise of TSPs take the lead here in building comprehensive IoT platforms and aspire to be market leaders rather than being fast followers and bit players.





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