Qualcomm Sees Demise of Proprietary IoT Nets

SAN JOSE, Calif. -- Proprietary and specialized Internet of Things (IoT) networks may not hold up against 3rd Generation Partnership Project (3GPP) standards and licensed spectrum, said Qualcomm executives here at an IoT workshop held for industry analysts.

Qualcomm's argument was forceful -- the company's position is that 3GPP will win out in the end. Executives pointed out repeatedly that the 3GPP standards, which will include LTE Cat-M and Narrowband IoT (NB-IoT), have scale and economics advantages over competing proprietary networks such as Sigfox, Ingenu, and LoRA.

(See our detailed, premium analysis of IoT standards and technologies in the Ultimate Internet of Things (IIoT) report.)

Of course, Semtech (SMTC), a chip vendor that competes with Qualcomm and owns the intellectual property (IP) behind LoRA chipsets, might have something to say about this. And one shouldn't ignore the irony of Qualcomm attacking "proprietary" technologies while it's in the midst of a massive lawsuit over licensing fees to Apple for using its chips.

Qualcomm's forceful position is likely to crank up industry debate about the future of Low Power Wide Area Network (LPWAN) designed to serve machines and devices known as the IoT. These networks have more specialized requirements compared with consumer mobile networks, such as requirements to reach longer distances at low cost. Private service providers such as Sigfox and Ingenu have raised hundreds of millions of dollars to build their own IoT networks on proprietary standards. Meanwhile, a large industry alliance has lined up behind LoRA, another competing LPWAN technology backed by large players including Cisco, Orange, IBM, SK Telecom, and ZTE, among others.

There's also political intrigue. Qualcomm's competitor SemTech owns the IP behind LoRA, and LoRA is not without support, with more notable deployments than NB-IoT so far. HP is working with Tata communications to build what it says is the world's largest LoRA network. End users have complained that the 3GPP standards such as NB-IoT have been too slow to arrive and that hardware is not ready for deployment -- while LoRA and other solutions are here today.

When I asked Peter Carson, Senior Director, Marketing with Qualcomm, what he thought about the fact that many industrial users are adopting the existing technologies because the 3GPP standards have been slower to develop, he responded, "There were many technologies developed first... [that later failed]."

WiMAX, for example (good one, Peter!).

Carson's presentation showed Qualcomm doubling down the bet on Cat-M and NB-IoT, including the design of multi-band chipsets that can handle both flavors at the same time. He said the additional investment will pay off with flexibility. Qualcomm favors 3GPP standards because they can be carved out of existing licensed spectrum and allow carriers to leverage existing infrastructure. For example, in the migration to 5G networks, the carriers will be able to "re-farm" existing spectrum out of 3G and 4G to use for IoT applications, which requires less bandwidth.

"The massive scale of LTE and the ease of upgrading the infrastructure means the vendors have all lined up," said Carson. "The industry is ready to do a massive shift that will light up much faster than a proprietary system will scale."

"With 5G mobile broadband -- the push is to go higher in frequency to support capacity," said Carson. "What's left -- low frequency bands is a prime opportunity for IoT standards."

Qualcomm, no doubt, can have massive influence on the development of IoT -- it enjoys a strong position as a dominant provider of wireless chipsets, especially for licensed spectrum used by the major global operators. But its unequivocal commitment to Cat-M and NB-IoT leaves very little wiggle room. It will also be interesting to see how influential players such such as Cisco, HP, Orange, SK Telecom, and Tata, which have made some bets on LoRa, will evolve their positions as Cat-M and NB-IoT come to market.

The bets are on! Stay tuned for more updates on the Qualcomm IoT workshop.

For a more detailed analysis of the Industrial IoT market, purchase our 50-page Ultimate Industrial Internet of Things (IIoT) Report, which covers a wide range of communications and cloud technologies that are being applied to businesses around the world to provide connectivity, analysis, automation, and optimization of a range of industrial applications.