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Why Internet of Things is not on Cellular

The Internet of Things isn’t that a big business , and the concept favors lots of small – scale devices, rather than a handful of hits. Certifying, provisioning, and managing data plans for all of these devices is a tall order for wireless carriers, you are used to selling smart phones by the millions.

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Particle, a prototype – to – production platform for developing an Internet of Things product, is in the business of making the tools that enable the “Internet of Things” devices, from circuit boards to software platforms too large the scale manufacturing plant. The company’s latest product, the Electron , is in the first to have a satellite radio and data plan built-in.

The creation of Electron has been a lesson in how wireless carriers work, including both their networks and their internal politics.

“There are a lot of really interesting customers out there that they would love to support,” Zach Supalla. the CEO of Particles said. “But they’re just not built to support smaller companies, and interestingly the definition of a smaller company can be quite large.”

Carriers are insistent on monthly plans, Supalla speculates, because they’re afraid that any exceptions they carve out for Internet of Things devices will jeopardize the smartphone plans at the core of carriers’ business.

“It’s so baked into their DNA, this monthly plan,” Supalla says. “Even us getting a plan where we didn’t have a contract associated with it—I mentioned we can suspend our SIMs and un-suspend them—that was hard to negotiate. They really didn’t want to give that up.”

It doesn’t mean that carriers are completely uncooperative about the cost of saving. For example, to save the cost they have reduce data rates during off-peak times. It makes a lot of sense for IoT devices whose transmissions aren’t urgent.

“In theory, every single party would benefit, but that’s not how they charge,” Supalla says. “They charge expensive rates for text messages—absurdly expensive, it’s like back to ’90s text-message pricing—and I’d like to see that change.”

Although many developers are interested, the problem of Internet of Things devices are still the same. An Internet of Things hardware must be smaller and cheaper to achieve ubiquity. But unfortunately, most of them are still expensive.

In cellular, a hardware cost comes down to intellectual property. For example, whenever Particle sells an Electron, the maker of the device’s cellular modules has to pay a licensing fee to Qualcomm because Qualcomm owns a significant number of patents for 3G and LTE radios. A $20 IoT device will have a harder time absorbing those fees than a $600 smartphone because so much of the final price goes toward licensing.

“The same kind of factors that are happening on the plan side are happening on the hardware side,” Supalla says. In other words, if Qualcomm reduced its fees just for small-scale devices, phone makers might complain or try to exploit that system to get away with paying less.

The problem might get solved over time. As LTE gets faster, telecommunications groups have agreed on a range of “categories,” each with their own limits on transfer speeds and simultaneous transmissions.

The hope is that licensors could dial their fees up or down according to these categories, and Internet of Things devices would sit on the low end. “Those are some of the issues that kind of have to get worked out, to become truly accessible for lots of different products,” Supalla says.

read more at fastcompany.

About Girly Saputri

Girly is a Content Marketing at Eyro Digital Teknologi, Ltd. She is also a copy writer and likes cheeseburger. She writes about iBeacon and its implementation. You can find her on LinkedIn as GirlySaputri.

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