You can’t move in this country at the moment without someone talking about the Internet of Things.
Two weeks ago Communications Minister Simon Bridges spoke about a report commissioned by the New Zealand Internet of Things Alliance. The report says the IoT could be worth $2 billion to the economy over ten years. That may prove to be a conservative estimate, although it depends on how you define the Internet of Things.
The New Zealand IoT Alliance is part of NZTech. It is an umbrella group set up as the voice of the technology sector.
Accelerate IoT adoption
All the main local IoT players are part of the Alliance. It’s job is to accelerate the adoption of the IoT. That sounds like it’s a good thing. It is a good thing. But it is also about sales.
When tech firms promise something approaching nirvana it is wise to remember Virgil’s Timeo Danaos et dona ferentes. Loosely translated means fear the geeks even when they bring gifts. OK, Virgil was talking about the Danaans or Greeks, but the point stands.
Vodafone says it will roll-out an IoT network early next year in anticipation of explosive demand. The company will offer Narrowband-IoT, a low-power wide area network. It uses dedicated, licenced spectrum. Vodafone says its IoT technology is secure and will cover vast geographic areas.
Spark also plans a Narrowband-IoT network. It says the network will open this time next year.
The telcos will join two existing IoT networks already in operation here. Wellington-based KotahiNet and Australia’s Thinxtra.
Premium IoT technology
Vodafone technology director Tony Baird describes his company’s NB-IoT as a premium technology. He says: “It is supported by over 40 of the world’s largest mobile operators plus many more suppliers and innovators that serve the majority of the global IoT market.”
His last point is important. If a business wants to invest in the IoT, it needs to make bets that will last for the long-haul. There’s always a danger of choosing a dead-end IoT technology like Betamax or CDMA. Vodafone’s message is that you’re not going to get stuck with unusable technology if you follow its path. On the other hand, premium also means not cheap.
The Internet of Things is about connecting sensors and other devices to the network. This is something Vodafone has been doing for some time now. The company already has more than 1.4 million devices on its 2G phone network in New Zealand. It will oversee many times that number of devices around the world.
Vodafone is a multinational business. It is a natural first choice for multinational players operating in New Zealand. They won’t need to start learning all over again to set up a local IoT network.
Vodafone says the NB-IoT is the same technology it uses elsewhere. The company has already tested NB-IoT in the field in a trial with Nokia, its technology partner for the project.
Spark is also working on a narrowband network that has evolved from cellular phone technology. It is working with Kordia to build the network.
The company is using its Connected Farms project to roll-out pilot capabilities on farms in the Waikato.
Vodafone and Spark have a number of things going for them. They have brand recognition, market power and a considerable installed based to call on. Both have signification infrastructure already in place.
If Vodafone and Spark have a downside, it is that they are often not as nimble as smaller players. They may get around this by partnering with local specialists. The IoT is a natural fit with New Zealand’s Wireless Internet Service Providers.
Big data, big bickies
Spark’s trump card is the link with its Qrious big data and analytics operation. Sensors produce a huge volume of data. Helping customers make sense of that adds value.
However, the big telcos don’t have it all their own way. KotahiNet has already staked out ground with its $1 per sensor per month easy to understand flat fee approach. That may yet be important in this market. When you deal with thousands of devices, the unit cost matters.
Two other things are impressive about KotahiNet. First, although it is small, KotahiNet already has plenty of runs on the board. That means customers to act as brand ambassadors or case studies.
Also, the business takes a bottom-up approach to IoT. The big telcos are much more top-down. You can buy a starter kit in the KotahiNet shop for a few dollars. That way you can tinker with the technology before making a large financial commitment. This approach could prove to be powerful when it comes to building partnerships and reaching engaged business owners.