MIDDLE EAST TELECOMS SUMMIT 2015 DELIVERING THE DIGITAL FUTURE LPWA STRATEGIES: MOVING BEYOND CELLULAR NETWORKS 11 November 2015 MICHELE MACKENZIE
CONTENTS THE LPWA OPPORTUNITY CURRENT STATE OF PLAY DEPLOY NOW OR WAIT? KEY TAKEAWAYS ABOUT ANALYSYS MASON 2
3 Question 1 Are you familiar with Low Power Wide Area (LPWA) network Technology for the IoT? 1. Yes 2. No
Suitable applications are low bandwidth and require two or more LPWA characteristics
It is essential to assess the levels of confidence in demand for specific application groups MEDIUM LIKELIHOOD Some evidence of demand STRETCH Theoretical demand, but none yet STRONG LIKELIHOOD Demand exists today 5
It is essential to assess the levels of confidence in demand for specific application groups MEDIUM LIKELIHOOD Some evidence of demand STRETCH Theoretical demand, but none yet STRONG LIKELIHOOD Demand exists today Street lights Gas and water meters Smart parking Container tracking Refillable fuel tanks 6
It is essential to assess the levels of confidence in demand for specific application groups MEDIUM LIKELIHOOD Some evidence of demand Pet tracking Waste bins Intrusion alarms (back up) Bike tracking STRETCH Theoretical demand, but none yet STRONG LIKELIHOOD Demand exists today 7
It is essential to assess the levels of confidence in demand for specific application groups MEDIUM LIKELIHOOD Some evidence of demand STRETCH Theoretical demand, but none yet STRONG LIKELIHOOD Demand exists today Wearables Forest monitoring Smoke alarms White goods 8
There is little overlap of LPWA use cases with cellular use cases Overlap LPWA Cellular 0 1 2 3 4 5 Connections (billion) Source: Analysys Mason 9
Connections (billion) Middle East Telecoms Summit 2015: Delivering the digital future There is a sizeable market opportunity: connections will reach 3.6 billion and connectivity revenue will reach USD10 billion by 2023 4.0 3.5 3.6 3.0 2.5 2.0 1.5 1.0 0.5 0.0 0.0 2015 2016 2017 2018 2019 2020 2021 2022 2023 Source: Analysys Mason 10
2015 2016 2017 2018 2019 2020 2021 2022 2023 Connections (million) Middle East Telecoms Summit 2015: Delivering the digital future LPWA will support smart city applications in the Middle East and North Africa (MENA) region Smart city LPWA connections, MENA, 2015 2023 14 12 10 8 6 4 Parking spaces Waste management Street lights Smart meters 2 0 Source: Analysys Mason 11
12 Question 2 Which application group do you believe is most in demand for an optimised IoT network in the MENA region? 1. Utilities 2. Smart cities 3. Consumer 4. None of these
CONTENTS THE LPWA OPPORTUNITY CURRENT STATE OF PLAY DEPLOY NOW OR WAIT? KEY TAKEAWAYS ABOUT ANALYSYS MASON 13
Emerging 3GPP standards Non-standard technologies Middle East Telecoms Summit 2015: Delivering the digital future There are different non-standard LPWA technologies available; standard solutions are yet to be commercially launched Technology 1 Spectrum Module cost Bit rates Quality of Service (QoS) LoRa Alliance NWave Ingenu (On-Ramp Wireless) Licenceexempt ~USD5 Tens of kilobits per second (Kbps) Best effort SIGFOX Telensa NarrowBand IoT ~USD5 Tens of Kbps Licensed QoS management LTE-MTC (R 13) ~USD10 Up to 200Kbps 1 Selected LPWA technologies 14
SIGFOX has partnerships in seven markets in Europe and plans to expand in the Middle East and Africa Non-operator LPWA deployments SIGFOX No SIGFOX deployment SIGFOX s new Dubai office Source: Analysys Mason 15
LoRaWan is the main technology deployed by operators for LPWA Operator LPWA deployments LoRA deployments To be announced U.A.E. South Africa Source: Analysys Mason 16
A national LPWA network is not a prerequisite for success a regional network may suffice Smart metering (some countries) Fleet management Smart metering (most countries) Smart cities Health Automotive Logistics Source: Analysys Mason 17
CONTENTS THE LPWA OPPORTUNITY CURRENT STATE OF PLAY DEPLOY NOW OR WAIT? KEY TAKEAWAYS ABOUT ANALYSYS MASON 18
19 Question 3 Do you think LPWA in licensed or unlicensed spectrum will dominate in the MENA region? 1. Licensed 2. Unlicensed
There are advantages and disadvantages to early market entry OPTION 1 Deploy non-standard LPWA OPTION 2 Wait for LPWA standard Advantages First-to-market advantages Disadvantages Higher costs Advantages Open standards, which incur lower costs Disadvantages Missed opportunity Source: Analysys Mason 20
Pioneers in LPWA deployments are taking different approaches, but taking advantage of early market entry LoRA network KPN (Netherlands) nationwide, but initially in only two cities Addressing demand in smart cities initially Cellnex Telecom S.A. (Spain) SIGFOX partner Nationwide coverage Addressing demand in the security sector (connected alarms), among others LoRa network FastNet (South Africa) M2M division of Telkom but structured independently Addressing demand in smart grid (Eskom) Arqiva (United Kingdom) SIGFOX partner Ten major cities covered Targeting opportunities in smart grid, smart cities, security and so on 21
Telcos may risk losing LPWA business to smaller, nimbler competitors Operators structure is not optimised to take advantage of new opportunities. Uncertainty around the growth potential of disruptive technologies may inhibit senior support. Disruptive technologies do not typically address the needs of established customers. 22
CONTENTS THE LPWA OPPORTUNITY CURRENT STATE OF PLAY DEPLOY NOW OR WAIT? KEY TAKEAWAYS ABOUT ANALYSYS MASON 23
Key takeaways 1 The LPWA market will grow significantly and could reach 3.6 billion connections with low cannibalisation of cellular. 2 Companies considering early launches of LPWA networks should minimise the risk of deploying a non-standard technology. 3 Established operators considering the LPWA market may need to rethink their strategy or risk failure. 24
We offer unique insight into IoT and M2M, and the opportunities for operators and vendors Most recent reports Title M2M in Asia Pacific: market opportunities and challenges for CSPs Publication date September 2015 The outlook for telehealth: opportunities for CSPs September 2015 Application enablement platform vendors need an ecosystem of turnkey IoT and M2M solutions August 2015 M2M scorecard for communications service providers 2015 June 2015 LPWA: the advantages and disadvantages of early market entry May 2015 Telecoms operators approaches to M2M and IoT May 2015 25
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