IoT a Windfall for Mobile Network Operators

Wednesday Sep 6th 2017 by Pedro Hernandez
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Thanks to the rapid growth of the Internet of Things, telecoms stand to generate major revenues over the next several years, says the GSMA.

Without connectivity, there is no Internet of Things (IoT). That essential fact along with an increasing number of IoT devices and systems that can transmit data wirelessly over mobile networks can add up to a massive revenue stream for the world's telecommunications companies.

According to a GSMA forecast released Sept. 6, the IoT represents a $1.8 trillion sales opportunity for mobile network operators by 2026. The trade group arrived at the figure based, in part, on data from Machina Research showing keen interest in commercial deployments of low power wide area networks.

"There is a real sense of momentum behind Mobile IoT networks in licensed spectrum, with multiple commercial launches around the world, as well as the availability of hundreds of different applications and solutions, but there is still much to be done," stated GSMA's chief technology officer, Alex Sinclair. "Many operators are already reaping the benefits of deploying Mobile IoT and we encourage others to act now to capitalize on this clear market opportunity and further accelerate the development of the Internet of Things."

The Americas are set to generate roughly a third (an estimated $534 billion) of that lofty total. To date, there exist 15 commercial mobile IoT services offerings from 12 providers, noted the GSMA. The list includes AT&T, Verizon, China Telecom, Deutsche Telekom and Vodafone, among others.

Generally, these telecoms are supplementing their licensed mobile networks with low-power LTE-M (Long Term Evolution-M) machine-to-machine technology and the similarly energy efficient NB-IoT (NarrowBand IoT) standard. By 2022, 56 percent of all low power wide area network connections, or 862 million active connections, will involve the mobile IoT, noted the GSMA citing additional data from Machina Research.

Consumer-facing mobile IoT services will be the biggest moneymakers, predicts the GSMA. Connected home systems will generate $441 billion for mobile operators by 2026, followed by IoT-enabled consumer electronics ($376 billion).

Utilities are also getting on board. The connected energy market will generate $128 billion for mobile IoT providers by 2026. Finally, smart cities are set to contribute $76 billion.

The IoT is expected to lift the fortunes of all types of technology companies, not just telecoms, provided they offer suitable products and services. In June, an IDC forecast predicted that worldwide IoT spending will approach $1.4 trillion in 2021 after hitting $800 in 2017.

Pedro Hernandez is a contributing editor at Datamation. Follow him on Twitter @ecoINSITE.

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