Wireline Phone Losses Continue into 1stQ-2017; Telco VoIP >PSTN Subscribers

By  Chris Young and Kamran Asaf of SNL Kagan

Losses in wireline phone subscribers picked up steam in the first quarter of 2017 as a lackluster performance by cable operators failed to offset declines from telcos. According to company reports and estimates from SNL Kagan, a media research group within S&P Global Market Intelligence, wireline phone providers lost 763,000 subscribers in aggregate during the quarter, a 40% steeper drop than the loss experienced in the first quarter of 2016.

Cable’s share of the shrinking sector creeped up to 45.2%, 2.5 percentage points over the year-ago quarter.

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New commercial subscriber information released by Comcast allows us to delve deeper into the segment. As expected, commercial services boosted cable’s voice segment as residential uptake falters. In some quarters, commercial voice gains offset declining residential voice losses at the operator.

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Charter is not immune to declining net additions. The operator’s voice net adds dipped considerably since closing its Time Warner Cable Inc./Bright House Networks LLC acquisitions. The operator faces a tough task overcoming churn at legacy Time Warner Cable systems, in part driven by its low-priced promotional voice offering in prior-year quarters.

Both Charter and Comcast are actively looking to deploy wireless telecom services by activating their mobile virtual network operator agreements with Verizon Communications Inc.‘s Verizon Wireless. While Charter expects to launch its service sometime in 2018, Comcast started taking sign-ups for Xfinity Mobile around mid-May. Comcast’s base offering starts at either $45 per month or $12 per gigabit of data consumed, according to the operator’s website.

Telco phone subscriptions:

The combined VoIP phone subs for AT&T Inc. and Verizon reached 9.4 million at the end of the first quarter and topped legacy circuit-switched subs by 511,000 as the traditional copper footprint contracted through upgrades and subscriber defections.

The telco sector has shown steady improvement of its fiber-deep phone penetration. AT&T and Verizon boosted combined IP voice penetration to over 51%, compared to 46% a year ago.

Despite losses in both IP and traditional voice subscribers in the quarter, FiOS improved its IP ratio with traditional subs to 54%, compared to AT&T U-verse’s 50% mix with traditional AT&T subs.

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AT&T U-verse phone gained 45,000 subs in the quarter, compared to a gain of 13,000 for the same period in 2016. The IP phone segment has been affected by stalled broadband growth linked to losses of bundled U-verse video subscribers while the company shifts its video focus to DIRECTV Group Holdings LLC. The company ended the quarter with 5.5 million IP voice subs. Overall wireline phone subscribers were down 9.2% compared to first quarter of 2016 after factoring in circuit-switched subscriber losses.

FiOS IP-voice growth stalled as subs decreased slightly to just below 3.9 million at the end of the first quarter. Similar to AT&T, Verizon’s combined IP and traditional phone line subscribers were down. Verizon’s wireline phone subscribers dropped 8% year over year to 7.2 million subscribers due to traditional phone line losses.

AT&T and Verizon posted total residential access line losses to end the year with a combined 18.2 million.

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CenturyLink/Level 3 Says Its Fiber Assets will attract SMBs

The fiber network resulting from the merger of CenturyLink and Level 3 Communications will allow the combined company to better compete with cable providers in serving small to medium-size businesses, says CenturyLink Chief Financial Officer Stewart Ewing.
“We think there’s a good opportunity there, and we need to act more as an insurgent than as an incumbent telco,” Ewing told investors at the J.P. Morgan 45th Annual Technology, Media and Telecom conference, which was held May 22-24, 2017 in Boston, MA.
CenturyLink said its acquisition of Level 3 will increase its reach by nearly 75% to approximately 75,000, including 10,000 buildings in EMEA and Latin America.
corporate sign outside of an office park

“In the areas where we are the local exchange carrier, there’s a tremendous opportunity to take some market share away from the cable companies, especially small to mid-sized customers where Qwest had lost quite a bit of market share,” Ewing said.

Sunit Patel, CFO of Level 3, said that the new on-net fiber footprint will give the new company an advantage of cable competitors.

“When you look at our on-net fiber building footprint as a combined company it’s quite substantial,” Patel said. “There’s absolutely no reason why we should not be able to compete against the cable companies in those buildings.”

Patel added that CenturyLink has potential to advance its market share with a larger set of services in these buildings with a larger fiber network.

“When you look at the market share penetration in those buildings, it is reasonably low so there are opportunities for market share gains there,” Patel said. “The proximity of our network to a lot of buildings is better as a combined company so if you leverage that we’ll be able to compete quite effectively against cable companies.”

References:

http://www.fiercetelecom.com/telecom/centurylink-level-3-say-combined-fiber-density-will-help-it-compete-against-cable-for-smbs

https://jpmorgan.metameetings.net/events/tmt17/sessions/12433-centurylink-inc-level-3-communications/webcast

 

 

 

New LoRaWAN™ network for IoT in Saudi Arabia from Actility and machinestalk

Despite numerous telcos announcing support for LTE Cat 1, M1 and NB-IoT (see recent techblog posts), LoRa WAN continues to gain market traction.  Last December, Tata Communications and Semtech announced they had worked together to deploy 35 IoT proofs-of-concept (PoCs) LoRa WANs in several India cities. The PoCs cover a wide array of applications, including sensors for remotely monitoring air conditioners and safety deposit boxes, energy management systems used to optimize the use of electricity, gas and water, and multiple smart buildings and smart city applications.

On May 22nd, LPWAN provider Actility and machinestalk (an IoT solutions provider), announced they are working together to begin the roll-out of a large-scale LoRaWAN network in the Kingdom of Saudi Arabia (KSA).

The partnership will combine the expertise of Actility with machinestalk’s market-leading IoT platform and solutions and will enable cutting-edge efficient and energy-saving IoT solutions and geolocation applications in the fields of smart cities and Industries, oil and gas, supply chain and logistics.

Managing Director Eng. Nawaaf Alshalani said, “We at machinestalk always seek to build and present an integrated ecosystem to our clients. As a result, we are collaborating with Actility to implement LoRaWAN network and LPWAN technologies, which will give an added value to the region as a whole, and enable the grow of the IoT market in the Kingdom in line with the 2030 Vision. Our studies and research indicate that 11% of IoT connections will use LPWAN technologies that serve applications and solutions that require low-cost, multi-year battery operation, long-range connectivity, and geolocation. We are proud of our partnership with Actility, a leading company in this field and a developer of ThingPark, the leading IoT platform. This collaboration will help us to provide better IoT services and solutions for various private, government, and semi-government sectors.” Eng. Nawaf added.

“We’re delighted to be working with machinestalk to begin the rollout of a LoRaWAN network in Saudi Arabia,” says Actility CEO Mike Mulica. “As a provider of IoT solutions for over a decade, machinestalk really understands the needs of the key industrial sectors in the Kingdom. Not only oil and gas, which are clearly pivotal, but also other applications in the new domains being grown in response to the very forward looking Saudi Vision 2030. We believe that a this LPWAN communications network will be a powerful platform to accelerate the the implementation of that vision.”

machinestalk is planning to use the LoRaWAN infrastructure to facilitate the implementation of IoT solutions in industry sectors including oil and gas, smart city solutions, M2M, and industrial applications. For the oil and gas industry, the network will support services including smart level monitoring and smart metering, improving the end to end supply chain. From the smart city perspective, machinestalk will deploy services including smart lighting solution, environmental monitoring, smart parking systems and waste management solutions resulting in more green, efficient and connected cities in Saudi Arabia and the MENA region.

References:

Arthur D Little- Telco Europe CEOs: 1% CAGR for Next 5 Years + Telco Transformation Issues

Source:  Karam Targa, Managing Partner & Global Practice Leader at Arthur D Little-Austria.

On May 15th, Arthur D Little held its flagship Telco CEO & Private Equity Event in its office in Vienna, Austria.  The event covered the key trends in the telecom industry, in which 60+ Telco CEOs, Managing Directors, Private Equity firms, Telco shareholders and European Regulators from more than 18 countries participated.   

Exclusive Telco CEO & Private Equity Event

This year’s gathering focused on the industry’s hottest topic:

How digitalization will impact telecommunication operators’ configuration

It addresses five critical questions for the telecom industry:

1.      Volume-driven growth in core telcos on the horizon, back to growth?

2.      B2B2x: will operators finally take advantage of the digitization of the industry?

3.      Changing production models: why and how?

4.      A new art: managing assets – why owning everything may not be optimal?

5.      Quantifying the impact for a new telco model?

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The event began with a welcome by Karim Taga, Global TIME Practice Leader and Managing Partner of Arthur D. Little – Austria. Following that was a presentation on the key observations and future strategic choices by Bela Virag, Partner at Arthur D. Little – Austria and lead author of this year’s flagship report. The event finished with a Q&A session, during which the topics raised a lively discussion about the implications of the findings on the future development of telecom operators (telcos).

Key insights:

  • AD Little expects that telcos will master the “ARPU x volume” battle moving forward, which will amount to approximately +1% CAGR (in Europe) over the next five years, stabilizing top-line growth.
  • B2B2x is gaining importance – it represents a new segment and an untapped opportunity for telcos, which can be captured by leveraging core assets and capabilities and understanding what is needed to help companies digitize.
  • New production models begin to emerge – a tailored transformational journey will be key to drive improved customer experience, lower production costs and more innovative/faster time to market.
  • Telecom Operators (telcos) will need to review how they manage their diverse portfolios of assets to deal with a potentially significant impact on balance sheets due to a shift from depreciation to OPEX.
  • AD Little expects the markets to recognize that, given a change from the traditional approach of asset management, vastly different types of operators will offer different risk profiles and abilities to scale.
  • Volume-driven growth in core European telcos is on the horizon, with an estimated 1% CAGR over the next five years (in the geographic perimeter considered in the report modeling).
  • Seeking further growth, some operators are expected to focus on new market opportunities outside their core segments and reconfigure their businesses in order to address the increased pressure on various financial margins.
  • The “ARPU x volume” equation remains a key characteristic of the telecom services market. Declines in ARPU are anticipated across nearly all market segments, coupled with volume increases.
  • AD Little forecasts that telcos will win the “price x volume” battle.
  • Mobile and fixed broadband services will act as key growth drivers and offset declining segments such as fixed telephony. This is part of a transition from having voice segments as the main revenue driver to becoming a complementary service in converged bundles.
  • Voice markets will become less relevant as the revenue share of converged services grows stand-alone segments and revenue becomes too complex to be attributed to the voice market.

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B2B2x: Will operators finally take advantage of the digitization of the industry?

B2B2x is a new segment seen as an extension in new markets, in parallel with the existing segments of B2B, B2C and wholesale. It is developing to capture the business opportunity of operating customers’ digital solutions. B2B2x differs from the other segments in that services become part of the client’s value chain.

It differs from the Internet of Things (IoT) in that it does not include B2C, but does involve services delivered by people.

AD Little expects this market segment to reach $276B in size – or 8% of global ICT spending – by 2020 and, as such, it should be one of the fastest-growing fields for telcos to focus on.

By leveraging their assets, telecom operators can carve out a space in the segment and address a much larger share of the “digitization of the industry” mega-trend than they have historically. Doing this requires a thorough understanding of what is needed to help companies digitize. We expect that some operators will actively address this new segment in an attempt to become part of their customers’ value chains, while others may choose not to participate. The main perceived drawbacks are around possibilities that the company is not ready yet, the opportunity is too small, or IT providers are better positioned, deterring the telco’s entry. Industrial digitization is already in motion, and there is a material opportunity in providing and operating digital services for B2B clients. Telcos can, as well as or better than IT companies, operate technical assets on a reliable, low-cost basis. In order to capture this new opportunity, telecom operators need to work towards proactively engineering and jointly operating business models for their customers, adopting a perspective of value co-creation.

Telcos need to amend the design, sale and operation of offerings, as well as increase the agility and openness of their internal systems and processes so they can produce repeatable and scalable results from the B2B2x segment.

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Changing production models: Why and how?

Three factors are driving new production models:

  1. An improved customer experience
  2. Lower production costs
  3. More innovation/faster time to market

AD Little Forecasts:

  • Eventually network resources will become elastic, transparent and accessible – moving far away from today’s often slow, cumbersome and inefficient architectures.
  • We will see web-like collaboration between companies emerge – even in the network and Operations Support System / Business Support System (OSS/BSS) domain.
  • We will also see web-like competition emerge (amongst telcos).
  • Cross-border service competition will arise and international expansion will be accelerated.
  • We expect groups with multinational footprints to be able to leverage group-wide scale effects and eventually achieve lower costs.
  • Beyond this, we expect some of them to become suppliers to off-footprint operators. Transformation programs must be tailored to achieve the strategic goal of the operator initiating the move.

AD Little Takeaways:

Four key takeaways emerge from AD Little’s analysis:

  1. There is no “one-size-fits-all” transformation program available, at least at a feasible price. As a consequence, telcos need to evaluate and set their goals and prioritize their choices.
  2. Customer experience strategies are geared towards enabling delivery of the demanded solutions, which still may lack the technology or an attractive business case.
  3. Cost optimization from business-model abstraction is enabled as hardware, software and related processes are automated and centralized, while divestment optimizes asset structure.
  4. Operators must make production models more accessible and programmable to enable swift and efficient innovation, beating competitors to market with a differentiating offering. Operators have struggled to monetize the growth of data traffic. More importantly, though, many operators have recognized that they need to redesign their production models to meet the continued demand for bandwidth, agility, accessibility and efficiency increases.

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A new art – managing assets: Why owning everything may not be optimal:

Traditionally, telcos owned and operated their infrastructure for both fixed and mobile telecommunication services. They obtained a unique strategic advantage by owning infrastructure that was wider in geographical reach and better in technology than that of competitors. The strategic advantage of owning infrastructure needs recalibration in importance compared to the past. Diverse asset groupings, such as data centers, towers and legacy networks, among others, require differing managerial approaches and strategic objectives. Operators will need to consider establishing dedicated approaches that suit each asset class. Certain assets, such as fiber and small cells, will likely work in asset-sharing models. As many copper-network owners embark on fiber-upgrade journeys, they will have to balance the need for fiber sharing with their legacy roadmaps. This is in stark contrast to cable network operators, which, given their technical nature, can follow “upgrade with demand” strategies.

Clearly, this will have a significant impact on balance sheets: a shift from depreciation to OPEX makes EBITDA levels less comparable.

However, the most dramatic impact will stem from the vastly different types of operators that spring into existence: we will have traditional players competing with asset-light players following rigorous cost-cutting approaches while operating on simple, customer-centric models. Beyond that, we will see international operators expanding their footprints based on equally available infrastructure assets.

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Quantifying the impact:

AD Little expects the markets to recognize that these vastly different types of operators offer very different risk profiles and abilities to scale. Operators can differentiate their plays by: becoming truly global players; partnering with capable players that fully embrace the new segments and customer needs; remaining strong and highly efficient in their domestic markets; becoming asset-heavy or -light operators; or becoming pure asset-holding and operating players. All of these possible paths have one thing in common: they anticipate the arrival of the next wave of efficiency increases – this time on a much more global scale.

AD Little expects to see an increase in the importance of non-tangible assets in the sense of capabilities: e.g., the “degree of openness” of an operator to third parties, the “market-oriented approach to assets”, and the ability to “take design responsibility for the software that runs their factories” will gain weight when assessing operators.

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Q&A Discussion:

Should operators be as they are today, or transform into asset-light and asset-heavy parts?

What role will the production platform play?

It became clear that changing the current set-up will raise a number of subsequent questions, e.g. how to manage the transition, what ownership and governance models to adopt and how differentiation from competitors can be achieved.

The B2B2x opportunity also raised interest. The main issues discussed were related to telcos’ ability to build up capabilities to partner and to open their production platforms. Overall, there seemed to be a consensus on the need for clearer evaluation of the necessary steps in terms of investments, acquisitions, and other means of capability building to engage in the B2B2x opportunity.

One of the final topics discussed related to the management of such diverse operators. Will EBITDA or EBITDA margins still be as relevant? It seems that management and investors alike will need to refocus on EBIT and FCF as the leading KPIs by which operators will be managed. As some operators will own infrastructure while others share or buy access to it, the EBITDA performance may vary greatly.

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About Arthur D. Little:

Arthur D. Little has been at the forefront of innovation since 1886. We are an acknowledged thought leader in linking strategy, innovation and transformation in technology-intensive and converging industries. We navigate our clients through changing business ecosystems to uncover new growth opportunities. We enable our clients in building innovation capabilities and transforming their organizations. Our consultants have strong practical industry experience combined with excellent knowledge of key trends and dynamics. Arthur D. Little is present in the most important business centers around the world. We are proud to serve most of the Fortune 1000 companies, in addition to other leading firms and public sector organizations. For further information, please visit www.adlittle.com

Copyright © Arthur D. Little 2017.

Contacts:

Ines Matzelle – matzelle.ines@adlittle.com

Karim Taga – taga.karim@adlittle.com

AT&T Launches Nationwide LTE Cat M Network + FTTP & Broadband Bundles

AT&T’s LTE Cat M (LTE-M) network is now live across the U.S. on the company’s nationwide LTE network after software upgrades.  The deployment was ahead of schedule and comes approximately seven weeks after rival Verizon launched its own LTE-M offering.  In an earlier techblog post this week, Sprint said it will deploy LTE-M in mid 2018.

The network will enable a new generation of devices and applications related to Internet of Things (IoT). The company is rolling out new rate plans with the LTE-M, starting from $1.50 per month per device, excluding SIM card fee, other setup charges, applicable taxes and fees. AT&T will also offer discounts for yearly and multiyear plans and volume commitments.

Customers can also get LTE-M modules from an AT&T supplier, starting from $7.50 each, including a SIM card, but excluding applicable taxes and fees.  The software for the company’s current IoT starter kits will also be upgradeable to LTE-M with an upcoming firmware update, the company said May 18.

“Our nationwide LTE-M deployment is another example of AT&T’s continued investment and leadership in IoT,” said Chris Penrose, president of IoT Solutions at AT&T, in a press release. “We can now reach new places and connect new things at a price that’s more affordable than ever before. Our LTE-M starter kit will also spur developers to open the doors to IoT innovation.”

AT&T said it plans to deploy LTE-M across Mexico by the end of the year, which will create a “North American LTE-M footprint covering 400 million people.”  The company first spoke of a potential LTE-M Mexico rollout at CES in January.

LTE-M – also know as category M1 (Cat-M1) – is one of three LPWA technologies licensed by 3GPP. The other technologies are NB-IoT and EC GSM IoT. US operators are particularly keen on LTE-M, though the technology also notably received backing in Europe from Orange and KPN.

Sigfox continues to be the largest LPWA network with LoRa WAN picking up a lot of support, as we’ve outlined in many previous techblog posts.

References:

http://about.att.com/story/att_launches_lte_m_network_a_step_forward_to_5g.html

http://about.att.com/story/north_americas_first_ltem_site_to_grow_iot.html

http://about.att.com/story/att_accelerates_deployment_of_lte_m_network.html

http://techblog.comsoc.org/2017/05/05/highlights-of-internet-of-things-developers-conference-april-26-27-2017-in-santa-clara-ca/

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FTTP & Residential Broadband Bundles:

AT&T’s CFO sees residential broadband as a growth area again with FTTP driving adoption of triple play service bundles.

John Stephens, CFO of AT&T, told investors during the MoffettNathanson Media and Communications Summit that customers in the fiber markets are purchasing multi-service bundles that incorporate either satellite or IPTV and wireless.

“The exciting part about fiber is what it’s doing to churn when you bundle it with wireless, when you bundle it with video and when it eliminates our position as one product offering to the home,” Stephenson said. “Now, with the video offering, I have the broadband to go with it.”

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John Stephens, CFO of AT&T, said the company’s investment in FTTP is driving bundle service adoption and reducing churn.

References:

http://www.fiercetelecom.com/telecom/at-t-says-fttp-driving-bundle-service-adoption-reducing-churn

CFO Touts Benefits of AT&T Broadband Bundles, Sees Broadband as a Growth Area Again

Sprint to Deploy LTE Cat 1 IoT Network by Mid 2017; LTE Cat M & NB1 to follow

Sprint says it will support low cost, low speed and power Internet of Things (IoT) devices by deploying LTE Cat 1 technology throughout its network by the end of July.  Ericsson will provide the network equipment.  Sprint’s announcement was timed to coincide with the IoT World 2017 convention in Santa Clara, California, this week.

The #4 wireless carrier in the US plans to begin deploying LTE Cat M (AKA LTE Cat M1) in mid-2018 followed by LTE Cat NB1. The move is aimed at supporting low-power applications such as telematics and industrial IoT software via Low Power (wireless) WANs (AKA LPWANs).

“We’re making great progress on our road map in support of the evolution of the IoT standards and access technology,” said Mohamad Nasser, GM of Sprint’s IoT Business Unit, in a statement. “IoT, along with wireless and wireline, is one of the three critical business lines for the Sprint Business portfolio. We are investing effort and capital to make sure that Sprint is well positioned to capitalize on the incredible growth that IoT will experience globally.”

“As one of the leading enablers and solution providers of the internet of things, Ericsson believes in its power to transform industries and capture new growth,” said Glenn Laxdal, head of Network Products for Ericsson North America, in the release. “Ericsson looks forward to partnering with Sprint to deploy Cat M1 next year and bring the transformative power of IoT to the Sprint Nationwide network.”

Sprint will move from LTE Cat 1 to LTE Cat M technology (which limits throughput and speed to lengthen IoT device battery life) beginning in mid-2018, and onto LTE Cat NB1, also known as narrowband LTE. The advanced technologies are targeted at IoT devices like industrial sensors, asset tracking, and wearables.

Sprint is the latest US wireless carrier to announce IoT network plans, following recent moves by Verizon, AT&T, and T-Mobile US. Verizon in late March said it had launched LTE Cat-M support across more than 2.4 million square miles of its network. The service ties into the US #1 carrier’s  ThingSpace IoT Platform and ThingsSpace client.

AT&T has said it will launch LTE-M services in the U.S. by mid-year, and in Mexico by the end of the year. The carrier began trialing the service late last year in San Francisco.

At this year’s Mobile World Congress event, T-Mobile US CTO Neville Ray said the operator will be deploying narrow-band LTE (NB-LTE), but did not give a timeline for that deployment.

Analyst firm ABI has predicted that CAT-M technology will see strong growth beginning in 2018 as network operators become more aggressive in their deployments. However, non-cellular low-power wide area networks (LPWAN) like Ingenu and Sigfox are expected to outnumber cellular networks in terms of connections by more than 12% by 2021.

Others echoed the sentiment, noting the initial cost advantage of non-cellular networks is likely to dissipate as cellular operators move on their deployments.

“Size and speed matter in the burgeoning LPWAN market,” said Steve Hilton, analyst at MachNation. “The more devices ordered for a technology like Cat 1, the lower the per unit price per device. And most assuredly the success of this market is going to depend on extremely inexpensive devices. In addition, the sooner that LPWAN solutions are available on licensed spectrum from carriers like Sprint, AT&T, and Verizon, the less market opportunity there is for non-dedicated spectrum solutions like Sigfox and Ingenu.”

References:

http://investors.sprint.com/news-and-events/press-releases/press-release-details/2017/Sprint-to-Support-Next-Generation-IoT-devices-Across-its-Nationwide-Network/default.aspx

Highlights of IoT Developers Conference, April 26-27, 2017 in Santa Clara, CA

IoT World Summary Part III: Too Many Wireless WAN (LPWAN) "Standards" & Specs

 

Residential Broadband: Fiber Access Now #1; Deep Fiber Penetration; Wireless Substitution & Forecasts

Fiber Tops DSL for Fixed Broadband Access:

Fiber has surpassed DSL as the most common fixed broadband access type, accounting for 43.2% of the global market, market research firm SNL Kagan wrote in a recently released market research report (subscription required). Kagan is a unit of S&P Global Intelligence.

Growth in fiber network deployment rose a sharp 55.6% worldwide year over year in 2016, putting fixed broadband connections on track to reach 1 billion subscriber lines by year-end 2021, a five-year CAGR of 5.2 %, Kagan wrote.

Note:  It’s not clear if the fiber numbers cited by Kagan are based on FTTH via GPON, optical Ethernet or other technology such as hybrid fiber-copper/coax. Please see quotes below on deep fiber penetration from Jeff Heynen.

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In contrast, the global DSL market (ADSL, VDSL, SHDSL, etc) registered a 32% gain, according to Kagan’s data.

China and the U.S., respectively, are the two largest fixed broadband markets, accounting for 46.9% of the worldwide total in 2016. China alone accounts for 34.7% of the global total, and fixed broadband connections increased 45.7% in 2016 as Chinese providers continue to follow through on the central government’s Broadband China initiative.

In addition to a growing FTTH footprint in the U.S., fiber-connected commercial buildings are on the rise as well. The number of fiber-connected commercial buildings in the U.S. soared 49.6 percent year-to-year in 2016, according to the latest market data from Vertical Systems Group.

Nine in 10 U.S. commercial buildings lacked fiber network access back in 2004. That dropped to 50.4% last year.

Source:  Article by Andrew Burger of Telecompetitor

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Telcos Transition to Deep Fiber Technologies & G.fast:

Jeff Heynen of SP Global Market Intelligence wrote in a recent blog post:

“The need to compete with cable gigabit service rollouts has forced telcos globally to shift spending on traditional ADSL and VDSL modems and gateways to units supporting deep fiber technologies, including fiber-to-the-home, or FTTH, and G.fast. The lone copper-based technology expected to see significant unit growth, G.fast, is forecast to jump from 825,500 units in 2017 to nearly 18 million units in 2022. In 2017, G.fast units are expected to represent just 1% of total DSL customer premises equipment, or CPE shipments. But by 2022, G.fast units, with the promise of faster speeds on traditional copper loops, are forecast to represent 31% of the total market. British Telecom (BT) should drive the most CPE shipments, with its announced plan to pass 10 million homes with G.fast by 2020. Beyond BT, Orange SA, AT&T Inc., CenturyLink Inc., Telekom Austria Group, Chunghwa Telecom and Israel’s Bezeq are expected to rely on G.fast for both single-family and multi-dwelling unit (MDU) deployments.”

Regarding AT&T’s announce move from VDSL2 to PON for it’s U-verse triple play service bundle, Heynen wrote:

“AT&T remains a major wildcard in the deployment of G.fast. Though the company has been firmly committed to shifting from its VDSL2-based U-Verse to Gigabit passive optical network (GPON)-based AT&T Fiber, the question is just how much of its existing U-Verse footprint will move to G.fast as opposed to full FTTH. Our expectation is that AT&T will use G.fast in certain residential markets, particularly MDUs and townhomes where G.fast can be deployed to address more than eight residences from a single DPU.”

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Residential Broadband Forecast by SNL Kagan:

Broadband subscriptions are on track to surpass 80% of U.S. households in 2017 and enjoy growing appeal in the five-year outlook. However, like the U.S. multichannel segment before it, the shadow of cord cutting threatens to darken service providers’ doorways in the extended forecast.

Residential high-speed data subscriptions are expected to crest the 100 million mark by the end of 2017 and hit 106.7 million by 2021, according the latest forecast from Kagan, a media research group within S&P Global Market Intelligence.

In the process, primary residential broadband connections from cable, telco, wireless and satellite services would reach nearly 84% of occupied households. While the appeal of broadband connections is not expected to lose its shine, the growth opportunity for wireline services faces limitations because of a consumer migration to wireless-only configurations.

SNL Image

Chart Courtesy of SNL Kagan

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Kagan’s revised outlook includes assumptions for an intensification of wireless competition, ramping up in 2020 and 2021 behind broader availability of 5G. However, the outlook still anticipates a reliance on wireline broadband for the majority of households as incumbent providers combat the lure of Internet cord cutting. The factors supporting confidence in wireline broadband include:

* Increasing speeds and monthly throughput — Wireline providers have consistently boosted speeds year over year with no sign of a ceiling.
* Greater in-home integration — Service providers are reaching beyond the three-product bundle to serve as home integrators of connectivity and other enhancements.
* Price competition — ISPs have capitalized on pricing headroom to boost rates and increase revenue but the thick HSD margins provide room to combat wireless replacement with more competitive prices.
* Interlocking fixed and wireless broadband packages — 5G’s reliance on dense local wireline networks for backhaul of the small cell architectures offers an opportunity for wireline providers to combine fixed and mobile subscriptions in a single package.

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Telco forecast by SNL Kagan:

U.S. telco’s residential broadband customers declined in 2016 with record full-year losses as a result of the drag from the diminishing legacy DSL base and cable competition.

According to Kagan estimates, the full industry finished the year with 33.1 million residential subs. Total HSD customers, including small businesses using DSL and fiber-deep connections, were also down at 36.4 million at the end of 2016.

With telcos losing legacy DSL customers primarily to cable, the industry has seen annual growth declines turn into net losses in the years since 2011 it had 800,000 net adds in 2011.

AT&T has demonstrated its long-term broadband commitment with its AT&T Fiber (previously called Giga Fiber) expansion. The service, which is more capable of competing with cable’s higher speeds, marks a shift from fiber-to-the-node to FTTH, allowing for planned speeds of up to 1 Gbps. However, AT&T’s decision to de-emphasize U-verse video stalled growth as some video customers defected to cable, switching broadband services in the process.

AT&T will lead the fiber-based telco footprint expansion. The AT&T 1 Gbps service is available in 52 of the 75 metro areas announced for the 100% fiber footprint as of the first quarter. By the end of 2016, the company had 4 million FTTH passings and expects to reach 12.5 million by mid-2019.

Verizon Communications Inc. announced it has upgraded speeds to nearly 1 Gbps in parts of its footprint. The enhancement, pushing customers to 940 Mbps down and 880 Mbps up, launched late April and is available to 8 million passings, more than half of the 14.1 million FiOS internet homes marketed as of the end of the first quarter.

Chart Courtesy of SNL Kagan

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Wireless-only forecast by SNL Kagan:

The wireless-only segment, i.e., households that use a wireless service as their primary Internet connection, has been kept in check with limited speeds and capacity constraints, but the landscape is expected to change. The opportunity for wireline HSD disruption and accelerated growth in single data services for consumers arrives later in the outlook with the adoption of the 5G platform.

Verizon expects the 5G standard to feature an exponential increase in speed with download speeds of multiple gigabits per second and millisecond latency that will deliver the benefits of fiber to wireless including 4K video streaming.

Verizon said a launch before 2020 is a real possibility based on the wireless industry’s engagement.

In the near term, the top two telcos, AT&T and Verizon, are moving ahead with their network upgrades to 5G. AT&T announced it will begin its transition to 5G in 20 metro areas by the end of 2017 and Verizon said it will deliver 5G services to customers in 11 markets in the first half of 2017.

We anticipate 5G standards to be in place midway through the outlook, with increased adoption of the service picking up in 2020 when the services launches.

AT&T launched its fixed wireless internet service in April. The company said the service will reach 400,000 locations by the end of 2017 and more than 1.1 million by 2020. The service is marketed at $60 per month for 160 GB of data. However, with fixed wireless download speeds initially pegged at 10 Mbps, we expect satellite HSD with its faster speeds to grow faster in rural and unserved areas until fixed wireless speeds increase.

The next generation of technology has the potential to lift wireless-only customers with the draw of improved speeds. However, even with 5G speeds on par or exceeding wireline HSD, we do not see it is a displacement for wireline offerings. We forecast the wireless segment to increase but still represent only a small portion of customers that rely on it solely for broadband access due to bandwidth limitations and a 5G rollout that could favor major metropolitan areas.

Kagan expects the number of households relying solely on wireless HSD connections to increase to 6.4 million by 2021. (To avoid double-counting, our tally excludes customers with wireless connections who also subscribe to wired HSD services.

SNL Image

Chart Courtesy of SNL Kagan

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AT&T to Trial Highly Touted AirGig Technology for fronthaul/backhaul

AT&T plans to conduct two trials of its AirGig millimeter-wave technology to show how it could be an alternative to fiber-based fronthaul (access) and backhaul, AT&T’s President of Technology Operations Bill Hogg said at the Jefferies 2017 Global Technology Conference which was webcast.  Mr. Hogg mostly talked about the evolution of AT&Ts wireless network as it moves toward “5G.”  That included: LTE Advanced, higher order MIMO, luse of small cells, distributed antenna systems,  licensed and unlicensed spectrum, centralized RAN (also known as Cloud RAN or C-RAN), and other wireless network densification schemes.

The highly touted (but unproven) AirGig technology uses electrical power lines as a waveguide for millimeter wave, providing data transmission at multigigabit speeds. We wrote about AT&T’s planned AirGig trial in this Feb 1, 2017 article.  It was first discussed 17 minutes and 40 seconds into Hogg’s talk during the Jeffferies Conference webcast (with hyper-link noted above).

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Sidebar:  For comparison purposes, note that both Verizon and Google are looking at millimeter wave broadband wireless technology to replace fiber to the home in their respective triple play offerings (Google Fiber and Verizon FioS).]

Propagation or the distance signals can travel, is much better than if “you just had millimeter wave antennas pointed at each other,” Hogg noted during the webcast.

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“It’s (AirGig) a great alternative to stringing up fiber, especially in rural areas where you have long runs,” he commented. “These are great opportunities to leverage the physical infrastructure that’s already been deployed.”

AT&T anticipates using AirGig to provide “fronthaul and backhaul instead of deploying fiber” for small cells, Hogg said. AT&T also envisions “using small cells as a drop to the house in a fixed wireless capability.”

AirGig also has the potential to detect changes in sensitivity that could indicate line breaks or when branches are lying on a powerline – a capability that could be very valuable to electric power companies, according to Hogg. The technology also may be able to support wireless meter reading for those power companies, he added.

Hogg reiterated AT&T’s previously announced plan to conduct two trials of the technology this year to perfect the model and deployment of AirGig.  It leverages the physical infrastructure (power lines) that’s already deployed.

Having an integrated wireline and wireless network is a key asset for AT&T, Hogg said.  “We’ve got a lot of experience in it,” he added.

References:

AT&T Offers AirGig Update, Reiterates Upcoming Trials for Fiber Fronthaul/Backhaul Alternative

http://about.att.com/newsroom/att_to_test_delivering_multi_gigabit_wireless_internet_speeds_using_power_lines.html

http://about.att.com/story/trial_project_airgig.html

 

Service Providers Talk White Box Trials & Future at 2017 NFV World Congress

Introduction:

The 2017 NFV World Congress was held May 2-5, 2017 in San Jose, CA. This author attended the first two days and was quite impressed with the depth and breadth of the presentations and panel sessions.

According to conference Chair Mark Lum, there were over 40 network operator speakers and/or panelists on the program.  Those included AT&T, Verizon, Sprint, Deutsche Telekom, BT, Orange,  Cable Labs (representing the cablecos/MSOs), NTT (2 divisions), China Unicom, Level 3, PCCW Global, and Google (which designs and deploys their own backbone + customer facing network along with a managed WiFi network for India Railways).  A few of the operator keynotes and panel sessions were from:

  • Ken Duell | AVP, New Technology Product Development & Engineering | AT&T
  • Shawn Hakl | Vice President | Verizon
  • Mansoor Hanif | Director of Converged Networks Research Lab | BT
  • Vijoy Pandey | Head of Engineering, Networking | Google
  • Geng Lin | CTO, Enterprise Network & Infrastructure Services | Google
  • Phil McKinney | President & CEO | CableLabs
  • Patrick Lopez | VP Networks Innovation | Telefónica (panel and keynote)
  • Andrew Dugan | CTO | Level 3 Communications (panel)
  • Lyle Bertz | Principal NFV/SDN Architect | Sprint
  • Klaus Martiny | Senior Program Manager | Deutsche Telekom (ETSI NFV ISG)
  • Hany Fahmy | AVP – Global Public Policy | AT&T
  • Jehanne Savi | Executive Leader, All-IP & On-Demand Networks Programs | Orange
  • Christos Kolias | Sr. Research Scientist & Principal | Orange
  • Francisco-Javier Ramón | Head of Network Virtualisation, GCTO | Telefónica
  • Travis Ewert | SVP – Network SW Development | Level 3 Communications
  • Ichiro Fukuda | Chief Architect, Infrastructure | NTT Innovation Institute
  • Kazuaki Obana | Executive Research Engineer | NTT DOCOMO
  • David Hughes | VP Engineering | PCCW Global
  • Shahar Steiff | AVP New Technologies | PCCW Global
  • Zheng Yi | Senior engineer of IDC network | China Unicom
  • Tetsuya Nakamura | Principal Architect | CableLabs

White Boxes Take Center Stage:

During the conference, quite a few network providers, including AT&T, Verizon and Telefonica, talked about open source software running on white boxes.  AT&T is preparing a US coast-to-coast trial, Verizon hinted that they would deploy white boxes soon, while Telefonica is committed to the Facebook organized Telecom Infrastructure Project (TIP) which is specifying “open hardware.”  In a blog post last June, Telefonica explained why it had joined TIP.

1.  AT&T’s Ken Duell, PhD said that AT&T had virtualized 34% of its network functions (via AT&T VNFs*) at the end of 2006 with a goal of 55% VNFs by the end of 2017 and 75% by 2020.  If so, this year would be the “tipping point” for AT&T’s virtualization of network functions as the majority of AT&T services would be delivered by VNFs.

* A Virtual Network Function (VNF) is often referred to as a “virtual appliance for networking.”  It replicates the functions of a specific type of physical network equipment via software running on a commodity compute server.  Examples include: virtual router, virtual firewall, virtual application delivery controller, virtual session border controller, etc.

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ONAP, previously described in this article, is an OS platform for managing and orchestrating network services. It was positioned as being complementary to VNFs.  Ken said both ONAP and VNFs would run on multiple white box configurations that provided closed loop control, self-service, and quick development of network applications (which would run on top of ONAP).

In AT&T’s forthcoming “coast to coast” white box trial there will be: three different chip vendors (Barefoot, Broadcom, and Intel); Network OS from Snaproute; and two ODMs (Agema and Edgecore).  Value added functions would use “closed loop control,” Duell said.  Please refer to AT&T White Box Trial illustration below.

Chart courtesy of AT&T

The white box switching and routing platform architecture is based on disaggregated hardware and software (courtesy of the Open Compute Project), a distributed network OS (dNOS), transition from closed (vendor proprietary boxes) to open networking (white box) environment, mix and match 3rd party control and management plane and VNFs though a common network data base.  Hardware and software are independently enabled by a hardware abstraction layer.  All of the above is depicted in the graphic below

Chart courtesy of AT&T

During the Q &A session, Ken noted that the scope of AT&T’s VNFs will be to grow new services, not to re-implement old one’s.  In particular, old legacy services (e.g. based on TDM) won’t have VNFs and customers using some of those legacy services will be encouraged to move to new packet services replacing them.

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Sidebar: AT&T wrote on the NFV website:

AT&T is on the leading edge in applying real-world SDN and Network Functions Virtualization (NFV) concepts to a carrier environment. The first of those deployments to launch, Network on Demand, allows customers to adjust their network capabilities on demand in nearly real time.

This network is supported by Domain 2.0, our supplier program, which will transform our network to a modern, open, cloud-based architecture. Domain 2.0 allows us to collaborate with a variety of vendors offering equipment to build this new architecture, based on NFV and SDN. We continue to seek out and welcome suppliers through an open and ongoing procurement process.  http://about.att.com/innovation/sdn

Note: AT&T last month said it tested an open source, white box switch carrying customer traffic.

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2.  Verizon’s Shawn Hakl  said incumbent network providers have put a large amount of dollars into new VNF and Software Defined (SD) infrastructure (including SD-WANs), which penalizes upstart providers that don’t have the money to invest in those areas.  For example, Verizon built an “orchestrator of orchestrator’s” to support its network virtualization technology.

He said that VNF innovation would necessitate multiple VNFs per box, micro-services (undefined), orchestration, and customized service(s) per customer.  Shawn claimed that “customers want true white boxes – commercial off the shelf hardware which could be re-purposed (for different services or applications).  He said that Verizon’s move to white boxes aligns with the companies long term “cloud vision” and that Bring Your Own Hardware (BYOH) is coming.”  However, he did not say when and was not at all definitive as Ken Duell of AT&T (as described above).

During a Q & A, Hakl would not disclose which white box vendors’ equipment would be included but said it will be a “mix of traditional and non-traditional suppliers.  Customers differentiate between white box and gray box solutions. We’ve firmly seen customers are looking for standard off-the-shelf hardware, and they are willing to wait for this,” he said. “They perceive their risk to be really low.  The people who have that are going to clean up,” he added.

Backgrounder:   In 2015, Verizon introduced a software-defined wide-area network (SD-WAN) service. A year later, it began applying network functions virtualization (NFV) to its enterprise customers. Next up: a white-box approach employs a cloud model to deliver services.

It’s interesting to note that with all the talk about a “cloud vision,” Verizon has exited the cloud computing business after acquiring Teramark for their data centers (now divested) to enable them to be a viable cloud service provider.  Verizon recently sold its cloud and managed hosting services to IBM in a deal that also includes further collaboration on networking and cloud services. The companies said the deal will allow each to “fully realize the benefits of their cloud computing investments.”

Conclusion:

Apparently Verizon and AT&T believe a white box solution enables service providers to deliver services on-demand, quickly, and efficiently. However, there’s a lot more systems integration involved as a network OS, various VNFs and a Management and Network Orchestration (MANO) software entity must be included to make NFV a commercial reality.  Also note that there are no standards for exposed interfaces, APIs or inter-layer interfaces (e.g. between a VNF and MANO).  In fact, one of the lunchtime roundtable discussions at Wednesday’s NFV Congress was whether or not telco’s could leverage open source MANO?  That remains to be seen.

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NFV Specification Status:

While NFV implementations are now being specified by Open Source projects like OPNFV (LINUX Foundation) and OSM (ETSI Open Source MANO), the foundation work for NFV was done by the ETSI Industry Specification Group for Network Functions Virtualization (ETSI ISG NFV).

That ETSI  group was responsible for developing requirements and a reference architecture for virtualization for various functions within telecom networks. ETSI ISG NFV launched in January 2013 when it brought together seven leading telecoms network operators, including: AT&T, BT, Deutsche Telekom, Orange, Telecom Italia, Telefonica, and Verizon. These companies were joined by 52 other network operators, telecoms equipment vendors, IT vendors, and technology providers to make up the ETSI ISG NFV. Not long after, the ETSI ISG NFV community grew to over 230 individual companies, including many global service providers.  Please visit various references below:

ETSI ISG NFV References:

NFV Technology Page (information): http://www.etsi.org/nfv

NFV Portal (working area): http://portal.etsi.org/nfv

NFV Proofs of Concept (information): http://www.etsi.org/nfv-poc

NFV Plugtest (information & registration): http://www.etsi.org/nfvplugtest

Open Area-Drafts: http://docbox.etsi.org/ISG/NFV/Open/Drafts/

Issue tracker: http://nfvwiki.etsi.org/index.php?title=NFV_Issue_Tracker

https://www.layer123.com/nfv-webcast-mle123-live/

 

 

Highlights of IoT Developers Conference, April 26-27, 2017 in Santa Clara, CA

Introduction:

There seems to be an Internet of Things (IoT) conference every month at the Santa Clara Convention Center, with the same issues and problems being discussed at each one.

The IoT Developers conference (IoT DevCon) is different. The conference is intended for embedded design engineers and managers working on IoT technologies and applications.  IoT DevCon seems to be the only conference and trade show focused specifically on the IoT product developer with real solutions discussed in technical sessions and several IoT modules/platforms displayed on the exhibit floor.

That’s why we found the conference very refreshing.  In particular, sessions on IoT security, Low Power Wide Area Networks (LPWANs), IoT FOG (edge computing) platforms and moving from IoT proof of concept (PoC) to production.

Sessions Attended:

These are the sessions we attended and learned from:

  • Powering a Bold New IoT Conversation, Greenwave Systems
  • Security Trade-offs and Commissioning Methods for IoT Wireless Protocols, Silicon Labs
  • Makeup of an Ideal Secured IoT Device, CENTRI Technology
  • How to Securely Connect to the Cloud, ST Microelectronics
  • FOG Computing’s Role in Solving Next-Generation IoT Challenges, Cisco
  • Why are 70% of IoT Projects Stuck in PoC Purgatory?, Electric Imp
  • Navigating the Non-Cellular Sea: Transitioning to LPWAN, Podsystem Inc
  • LoRa Technology and Real World Applications, Microchip Technology Inc

Please contact the author (ajwdct@comsoc.org) or the particular speaker if you’d like additional information on any of the above sessions.

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Observations:

Due to time and space limitations, we can’t cover all of the above sessions or the various IoT modules observed on the show floor. This conference report focuses on LPWANs, which is the hottest area for IoT wide area connectivity between devices/gateway and the ISP point of presence.

On other topics, speakers said security was improving for wireless LANs (especially WiFi), that there were specific steps and recommendations to move from IoT proof of concept (PoC) to production, and there is a very important role for FOG or edge computing in many IoT industry verticals (especially those requiring low latency or caching of information).

LPWAN Sessions:

1.   Navigating the non-cellular sea- Transitioning to LPWANs, Sam Colley, CEO, Podsystem Inc.

Abstract: There is currently a lot of talk surrounding non-cellular connectivity for IoT, and it can be difficult to see how to integrate these new services with your existing devices. The applications that can benefit from these technologies are almost endless, from smart roads to agriculture and renewable energy, but as LPWAN expands globally, cellular technology will help to supplement its growth. For these sectors and countless more, freedom to use both cellular and LPWAN technologies together is crucial to minimise downtime, and allows devices to be future-proofed despite major market changes. Mr. Colley’s presentation delineated the different options available to the IoT market today, and show that a flexible approach to connectivity is the most sensible approach in these interim stages of LPWAN.

Backgrounder:  Podsystem Group is a global Mobile Virtual Network Operator (MVNO) offering data connectivity worldwide via three dedicated divisions focused on the M2M/IoT, business enterprise and operator markets.  The company is privately owned, 100% dedicated to customers needs and focused on research, development and innovation.  Podsystem claims to have a “unique data connectivity solution provides maximum reliability and control.”

What are LPWANs?

As we’ve discussed in many previous tech blog posts (e.g. 2016 IoT World-Part 3), LPWANs are low power, low speed, (perhaps) low duty cycle, wireless wide area networks that are specifically intended for low cost IoT/M2M communications.  They are NOT  for broadband mobile endpoints (e.g. smartphones, tablets, low latency or high bandwidth IoT devices, etc).  That class of IoT devices is best served by LTE, LTE-Advanced or “5G.”

Chart Courtesy of Podsystem Inc.

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Among the LPWAN contenders are:  LTE Category M (or M1), Narrow Band (NB)-IoT,  LoRa WAN, Sigfox (proprietary network provider), Weightless SIG, Random Phase Multiple Access (RPMA) by Ingenu, and many other proprietary versions.

Sigfox is the largest deployment of the LPWANs globally, operating primarily in France.  It is based on a proprietary Radio Access Network (RAN) specification that uses (free) unlicensed spectrum and requires low power devices as IoT endpoints.  Of course, the risk with unlicensed spectrum is frequency interference.  Other attributes of Sigfox include:

  • Extremely low throughput – 18-36 bytes/s
  • Unique Positioning Technology (spot’it)
  • Very Low Power
  • Very Low Cost to user
  • Infrastructure required is high – Sigfox must build it all
  • Could be said to be a niche technology due to limitations

Note:  Upon invitation by this author, Sigfox presented their technology at an IEEE ComSocSCV meeting in 2015.

Mr. Colley said that the Weightless SIG, now aligned with ETSI (with three different versions), is the only truly open LPWAN standard.  It comes in three versions as we’ve previously described in this blog post.

The cellular industry’s response for LPWANs was to introduce LTE-Category M (sometimes referred to as LTE-CAT M1) and NB-IoT.  However, that’s caused even more confusion in the areas of cost, power and coverage.

Safeguarding against a wealth of standards and technologies or future -proofing will be very difficult.  5G and cellular IoT offerings (LTE, LTE CAT M/M1, 5G, etc) will expand cellular IoT use, no single connectivity option will suit every application.  Here are a few suggestions offered by Sam:

• Agnostic approach will be necessary

• Businesses tied to one technology face incompatibility

• Dual cellular/LPWAN modules could bridge gap

• Secures against failure of any one standard – forward compatibility

• Platforms can offer true interoperability

• Centralized control of different technologies across your base

• Consolidating account management including billing without compromising on one bestfit connectivity

• Receivers & transmitters must not be restricted – future cross-sector competition & collaboration requires adaptable connectivity

Chart Courtesy of Podsystem Inc.

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LoRa Technology and Real World Applications, Dave Richkas Product Line Manager, Microchip Technology Inc.

Abstract: Microchip believes that LoRa WAN has become established as the leading technology within the LPWAN space, with a fast growing ecosystem of solutions ready to use today. Mr Richkas’ presentation provided an overview of the LoRaWAN technology and its capabilities, a view into the LoRa Alliance and its growing membership, plus real world examples of both public and private deployments.

Comment: This author was surprised and impressed to learn how many companies had joined the LoRA Alliance and how many LoRA WAN networks have been deployed to date.   As noted in the illustration below, there are 460+ members of the LoRa Alliance.  The member list is here.

Chart courtesy of LoRa Alliance

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Technical Aspects:  LoRaWAN™ is a Low Power Wide Area Network (LPWAN) specification intended for wireless battery operated “Things” in a regional, national or global network. LoRaWAN targets key requirements of Internet of Things such as secure bi-directional communication, mobility and localization services. The LoRaWAN specification provides seamless inter-operability among smart Things without the need of complex local installations and gives back the freedom to the user, developer, businesses enabling the roll out of Internet of Things.

LoRaWAN network architecture is typically laid out in a star-of-stars topology in which gateways is a transparent bridge relaying messages between end-devices and a central network server in the backend. Gateways are connected to the network server via standard IP connections while end-devices use single-hop wireless communication to one or many gateways. All end-point communication is generally bi-directional, but also supports operation such as multicast enabling software upgrade over the air or other mass distribution messages to reduce the on air communication time.

Communication between end-devices and gateways is spread out on different frequency channels and data rates. The selection of the data rate is a trade-off between communication range and message duration. Due to the spread spectrum technology, communications with different data rates do not interfere with each other and create a set of “virtual” channels increasing the capacity of the gateway. LoRaWAN data rates range from 0.3 kbps to 50 kbps. To maximize both battery life of the end-devices and overall network capacity, the LoRaWAN network server is managing the data rate and RF output for each end-device individually by means of an adaptive data rate (ADR) scheme.

Dave noted that each LoRa endpoint device class has different behavior depending on the choice of optimization: Class A – Battery Powered; Class B – Low Latency; Class C – No Latency.

A key point is that the LoRa certification program is essential for successful inter-operability between the endpoint device and LoRa WAN.  There are multiple independent test houses accredited for Alliance certification and a growing list of certified low cost products.

There are at least 34 national deployments of LoRa WAN. Network operators that support LoRa include: Comcast, Bouygues Telecom. KPN, Orange, Tata Communications, SK Telecom, Swisscom and several new players.   For example:

  • Senet has deployed a U.S. nationwide LoRa network;
  • Digimondo FireFly (a subsidiary of E.On Energy Company) is deploying a German-wide LoRa network;
  • Digital Catapult  has a “Things Connected”  IoT network in London, England;
  • KPN has deployed a nationwide LoRA WAN in the Netherlands;
  • SK Telecom (working with Samsung) has a nationwide LoRA WAN in South Korea.

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Microchip, which acquired Atmel last year, intends to provide for local wireless (e.g. IEEE 802.15.4 sub gHz radio), personal area networks (e.g. BlueTooth), and LPWANs (e.g. LoRa WAN) in different modules it makes. For more information on a new Microchip product for wireless IoT designs visit their press release here.

–>The company displayed a LoRa WAN connected mousetrap in their booth on the exhibit floor.  They also showed the following as per Dave Richkas post conference email:

1.   SAM R21 & SAM R30 System in Packages (SiPs) for wireless connected designs.  The SAM R21 (SAM R21) and SAM R30 (SAM R30) have embedded ARM® Cortex®-M0+architecture which provides the developer with a choice of multiple wired interfaces, including: UART, SPI, I2C, USB host or device, GPIO and several 12-bit ADC channels. These wired interfaces bridge the connected sensors (digital or analog) to the wireless interface. Both SiP’s support the industry standard IEEE 802.15.4 MAC/PHY layer. The SAM R21 operates in the 2.4 GHz spectrum and was demonstrated in the Phillips Hue lighting solution along with theATMEGA2564RFR2 MCU, which was used in the energy harvesting switch that sends Zigbee® packets to control the lights (SAM R21) through the Hue Hub (SAM R21). The SAM R30 bridges those same interfaces to 15.4 operating in the Sub-GHz space where better range can be realized.

2.   The LoRa modules shown included the RN2903A (for North America) which offers a standard UART interface and is controlled with Simple ASCII commands – that means no special software tools or code to compile. There is also an option to add your own basic sensor code to the 8-bit MCU (micro-controller) inside the module to utilize additional GPIO and serial interfaces using Microchip’s MPLAB®Integrated Development Environment with Microchip’s Code Compiler – MCC.

End quote from Dave Richkas of Microchip:

“Our goal is to continue to deliver lower-power connectivity solutions that meet our customers’needs.  Battery-powered remote solutions are becoming more and more popular. Additionally, the need for extended range emphasizes the need for sub-GHz wireless solutions for IoT. LoRa can deliver 10Km of range and last years on a couple of AAA batteries. Designers are also looking for ways to “cheat” range limitations and that’s where technologies such as our MiWi™ protocol delivers more than a simple point-to-point connection and provides star (demonstrated on the SAM R30 at the show) and mesh configurations.”

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LPWAN and LoRa WAN References:

https://iot-for-all.com/history-of-lpwan-look-future-of-lpwan/

IoT World Summary Part III: Too Many Wireless WAN (LPWAN) "Standards" & Specs

http://www.amihotechnology.com/global-perspective-lorawan/

http://www.rcrwireless.com/20160704/carriers/operators-korea-netherlands-deploy-lora-networks-iot-tag23

https://www.i-scoop.eu/internet-of-things-guide/iot-network-lora-lorawan/

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