|Issue:||North America 2010|
|Topic:||M2M and the promise of LTE/4G|
Steve Pazol is the President of nPhase, a Verizon Wireless / Qualcomm joint venture. Previously Mr. Pazol was Vice President and General Manager for the Global Smart Services group, for Qualcomm Enterprise Services. Steve Pazol has a degree in Electrical and Computer Engineering from the University of Michigan.
Machine to machine technology has become an integral part of many business-to-business operations including telematics, marketing, power monitoring and the smart grid, manufacturing, fast food, security and healthcare. But now technology developers are poised to take full advantage of the potential and performance of LTE networks. Existing machine to machine applications will be enhanced and new applications will be developed with the advent of LTE.
Machine to Machine (M2M) technology speaks to the promise of everything becoming connected. By leveraging the leap in performance of 4G with Long Term Evolution (LTE) over prior technologies, this promise is becoming a reality. LTE provides new opportunities for M2M deployments by delivering bandwidth and speed that aren’t fulfilled by preceding generations. However, on the early side of the rollout of LTE, the reality is that today most M2M deployments are running just fine on 2G and 3G networks. The potential of 4G for M2M can’t be fully understood without looking at it where 4G makes sense and where 2G and 3G networks will suffice. In this article we’ll look at barriers, opportunities and how the M2M-enabled LTE world could look within the historical context of 2G and 3G. Despite the fact that the term M2M has yet to enter the common lexicon, its influence can be felt just about everywhere. Twenty years ago the concept of remotely monitoring and/or controlling distributed assets and devices was mostly reserved for large and expensive investments like power plants and dams. Today’s new connected products exemplified by eBooks and cars (think OnStar) are coming to market with increased frequency. And that’s just the world that the average consumer sees. On the business-to-business side, M2M has become an integral part of telematics, marketing, power monitoring and the smart grid, manufacturing, fast food, security and healthcare. One interesting aspect of M2M’s evolution has been the moves by technology developers to take full advantage of the networks available to them. It makes sense if you look at it through the lens of the IT world: any programmer’s wish list includes more processing power, more memory and more bandwidth. As the cost of these resources goes down, developers and programmers find new ways to use plentiful resources. One early leap in the development and deployment of M2M technologies involved 2G networks and the move from analog to digital. Beecham Research (2009) cited: “over 90 percent of existing wireless M2M modules, excluding eReaders and similar consumer devices, operate on 2G networks.” There are several reasons for this level of market penetration: 2G is ‘cheap’; it delivers enough bandwidth for many tasks; 2G networks are the most widely deployed worldwide and support a large variety of embedded, reliable, low-cost components. 2G is sufficient for many applications that have low bandwidth requirements and are very cost sensitive. Automatic meter readers for the smart grid, many home security systems and basic telematics service are examples of perfectly acceptable 2G applications. One challenge for the operators (which few outside the industry know) is that it‘s more expensive to move a bit of information over 2G than 3G and 4G. So as operators are looking to make more efficient use of their spectrum, 2G is less than ideal. After 2G is, of course, 3G. 3G has actually given us a glimpse of what 4G is going to look like, because we know where 3G leaves end users desiring more. 3G opened new doors in M2M, with its ability to provide more data at faster rates, support for video and its capacity to send large packets and files. On the consumer side 3G technology is standard in most products, including eReaders, tablets, PC cards and dongles. On the business-to-business side we’ve seen larger amounts of data transmitted as more complex applications continue to come online across industries. Examples of applications include remote patient monitoring, remote industrial equipment management and monitoring of sensor networks. Because 3G offers a vast increase in speed over 2G, developers are able to produce interesting and richer applications that require more data. For these applications, the incremental cost of moving from 2G to 3G is easily justified. 3G can simply do things that 2G can’t. Entering the world of 4G and LTE is a different matter, because in this instance, some existing 3G applications may just be ‘made better’. And better is sometimes not worth the additional cost to the consumer. Where does 4G promise to excel? What are some of the barriers to transition? These are common questions for curious observers. In the final analysis we will probably see a future (three years out) that has a place for 2G, 3G and 4G. There are a couple of significant drivers that will come to play as the operators go through their capital replacement cycles. One of the most important considerations involves more efficient use of spectrum. Spectrum is a limited resource and costs billions of dollars. If you look at the impact of products like the iPhone that can literally overtax a network, you can see that being able to get more data through the same resource will be a significant driver for operators to upgrade to the latest technologies. For companies deploying M2M solutions, many technology decisions begin at the device side with an assessment of the form factors of equipment involved in a deployment. 4G involves more complicated devices. There’s more engineering embedded in them, and in short, they take up more space. There may be devices that simply can’t be engineered around the space that a 4G solution requires because of their form factor – as long as 2G networks are around, that is. Another issue is how long will the 2G networks remain active? This is not a simple question, but relies on a number of factors: whether the 2G network is fully depreciated, the cost to operate the network, assurance of supply agreements (think of utilities and their meter deployments) and, as stated before, the requirement to make efficient use of the limited spectrum. 4G deployments have already begun in Europe and are now beginning in the US. Verizon is in the process of deploying a nationwide LTE system, which will provide close to ubiquitous coverage with speeds of up to 100 Mb/second. With the historical context of 2G and 3G established, what does this world look like and who is going to play in it? Well, that depends on where you’re standing. Let’s start in the home. An LTE-enabled connected household may sport some features we’d all like to see. Imagine transmitting video from your 4G-enabled camera to the cloud and having it appear on your grandmother’s TV. Home health care and elderly management with video and patient data will be important as the population continues to age. LTE technology will provide the bandwidth to provide smooth video-to-video communication, and this same bandwidth will enable robust social networking and wireless gaming. LTE will extend into mobile entertainment on demand, and could have a profound effect on how Hollywood and the television networks decide to deliver their content. Let’s leave the house and look at the car, or any moving vehicle, because LTE will have a sizable impact on the telematics space. LTE offers the promise of transforming vehicles into real mobile communications centers, offering heightened security, infotainment and a host of outbound data flow. Here’s a short list of what the M2M connected car of the future might like: • Safety and security: Tracking and stolen vehicle recovery, wrong way driver alerts, emergency assistance, crash notification, approaching emergency vehicle warning, maintenance alerts, remote door unlock; • Connected experiences and infotainment: Interactive gaming, car as a mobile hot spot, full Internet experience with real time news, movies, etc.; personal consumer equipment device integration; • Cost savings: Location-based coupons, eco applications, low gas prices; and • Convenience: Weather, concierge services, Bluetooth and voice features, vehicle diagnostics, electronic vehicle charging station. Security is an obvious area and utilizes some of the same features found in the connected car or in the entertainment sector. Real-time video access to monitoring systems anywhere is an easy extension of what’s already happening with surveillance today. But what are the enhanced applications? Homeland security has many potential applications for M2M LTE solutions, from border monitoring to remote facial recognition, TSA screening and facilities monitoring and management. The military is actively involved in pushing this technology to its limits with its drone programs, remote surveillance technologies and control over field distributed personnel and equipment. The military has historically been a driver of technology, and this current burst of activity will begin trickling into the mainstream within the next few years. M2M connected healthcare is another area where LTE will enhance current applications and provide an opportunity for the development of new and needed solutions. This market is still nascent and complicated, with ecosystem issues such as liability, payer, and regulatory issues, but the promise of LTE-enabled M2M solutions is too important to ignore. Some research suggests the market for telemedicine devices and services will generate US$3.6 billion in annual revenue within five years (Health Data Management, Oct. 2009). There are a myriad of applications currently being planned or slated for enhancement. These include electronic medical record population and processing, treatment advice and education, home health management and medical asset tracking. At home chronic care and at home diagnostics are two of the strongest and most interesting aspects of this category, offering a host of monitoring services that could supplement or in some cases replace the need for personnel in home visits from health providers. Utilities are another important area where existing M2M applications will be enhanced and new applications will be developed with the advent of LTE. The M2M utilities vertical is expected to grow at 42 percent CAGR (ABI, 2009) over the next five years with a high propensity for automating operations. There is an ongoing dialogue concerning the smart grid, which seems to focus primarily on meter reading. As we’ve discussed, much of this is served by 2G solutions. The backbone of this grid will lie in management and control, which will serve to create greater efficiencies and ‘greener’ energies. LTE will affect Supervisory Control and Data Acquisition (SCADA) – systems used to monitor and control transmission and distribution equipment, field engineering, the automated meter infrastructure, and inventory management. One of the key advantages of LTE-enabled M2M solutions will lie in reducing the high costs of data collection and on-site services and remotely managing and tweaking power generation and transmission and distribution facilities for maximum efficiency based on increased access to more robust data. As happens when any new technology enters the market, there are opportunities for incumbents as well as new entrants. The move to 4G is no different. Factors that will be debated, and may propel or hold back adoption or development or solutions include: • Availability and cost of modems; • Device form factor requirements; • Useful life of legacy devices versus replacement costs; • Availability of other technologies; • Ubiquity of network coverage; • New service pricing models; • Speed of market adoption for new technologies; and • Legislation. It is very likely that as LTE becomes the new standard and reaches a point of ubiquity, the older technologies will eventually be phased out and replaced. The ultimate promise of M2M and LTE will be a world in which connectivity is expected and demanded. That day is coming soon.