#TheDataPoint: The mobile infrastructure market

Check out the first of #TheDataPoint series where Head of GSMA Intelligence Peter Jarich gives a snapshot analysis of what’s happening in the world of mobile. This week looks at recent shifts in the mobile infrastructure market share where a major factor proving itself is investments in 5G.

Intelligence Brief: How the IoT ecosystem stacks up

Recent weeks have seen interesting developments within the IoT ecosystem, coming from the likes of ARM, Google, Intel, Qualcomm and Samsung. It made me revisit ecosystem players’ positioning within the IoT value chain, having already looked at how operators are positioned [1].

The simple fact of the matter is the importance of partnerships and collaboration cannot be overstated in IoT. The point laboured time after time is that no one company can do it all, by which I mean provide an end-to-end solution spanning chipsets, application and system integration. Sounds pretty obvious, but it doesn’t mean IoT ecosystem players haven’t tried to become sole solution providers.

So, let’s take a look at how some of the top tech giants are positioning in IoT. For simplicity I’ve split IoT capabilities into devices, modules and chipsets, platform management, data analytics, cloud and security layers.

[2]In essence, the boundaries between traditional technology/IT players and others are blurring as new business models in IoT emerge around data, analytics and, in a more broad sense, services. Companies are moving up and down the IoT value stack, aiming to capture the largest piece of the IoT revenue pie (see chart, click to enlarge – the red circle identifies the company’s core IoT capability, the arrows signify their expansion direction, and grey indicates areas of focus).

Just to remind ourselves how big this is, GSMA Intelligence forecasts revenue from IoT applications, and platforms and services (including cloud and analytics), will increase sixfold between 2017 and 2025, bringing in $137 billion and $754 billion respectively. In short, a rather attractive revenue opportunity.

Upping the software stack: Technology companies such as Google, Microsoft and Amazon are adding devices to their existing software stack. Google has been investing in machine learning (ML) and artificial intelligence (AI) for years and is already well positioned in the data analytics space. During its recent Google Cloud Next ’18 event, the tech giant announced initiatives aimed at moving analytics close to the edge or near the point of data generation: namely, Cloud IoT Edge (software for IoT gateway-class devices running Android Things or Linux) and Edge TPU (a chip specifically designed to offer ML inference on edge devices).

This is a pretty compelling proposition for the fast growing industrial IoT segments such as smart cities, oil and gas, utilities and manufacturing. I also can’t ignore Amazon’s Alexa, which has been a runaway success in the smart speaker market. For example, Ofcom figures show 13 per cent of UK households now own a smart speaker, of which 75 per cent are Amazon Echo models (which feature the Alexa assistant).

From the devices up the stack: On the other side of the spectrum, traditional manufacturers and OEMs including Cisco, Intel, ARM, Samsung and Qualcomm are augmenting their existing core capability, hardware (modules and devices), with platform and data analytics capabilities. These companies grow their current capabilities either organically or by acquisitions with the ultimate goal to move into AI.

But also they want to address the pressing issue that is IoT security.

For instance, Samsung has been expanding its capabilities up the IoT value stack to include platform management and data analytics, but also down the stack – launching ARTIK modules tailored for IoT and ARTIK IoT Security. Recently, the company committed to a KRW25 trillion ($22.3 billion) investment [3] over three years in areas including IoT, AI and 5G.

Despite its bid for NXP Semiconductors falling [4] through, Qualcomm’s optimism when it comes to the IoT opportunity shows no sign of abating. It expects $1 billion in revenue from IoT this year as its chips make their way into even more devices: with a total of more than 200 wearables and 1,300 different wireless headsets, earbuds and wireless speakers on the market.

Platform seems to be the only game in town when it comes to IoT: Platforms management (in which we include connectivity, device and application management) is an almost default position for any digital company with designs on the IoT market. Most recently, ARM announced its ARM Pelion platform to support its vision of 1 trillion connected devices by 2035. This stems from the acquisition of Treasure Data, an enterprise data management company which it dubbed “the final piece of our IoT enablement puzzle”, along with the integration of its Mbed IoT Device Management platform with the recent acquisition of Stream Technologies.

Last, but not least, if it ain’t working…let it go: Intel reported revenue of $880 million in Q2 from its IoT Group, a 22 per cent year-on-year increase equivalent to 5.2 per cent of overall revenue. However, in April 2018, a decade after the acquisition, Intel divested Wind River [5]. Why? In the words of IoT Group leader Tom Lantzsch, it is a move designed to sharpen Intel’s focus on growth opportunities which align to Intel’s data-centric strategy.

– Sylwia Kechiche, principal analyst – IoT, GSMA Intelligence

The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.

[1] https://www.mobileworldlive.com/blog/blog-the-operator-opportunity-in-iot-not-lost-yet/
[2] https://www.mobileworldlive.com/wp-content/uploads/2018/08/IoT-ecosystem-pic2.jpg
[3] https://www.mobileworldlive.com/featured-content/top-three/samsung-to-boost-ai-5g-investment/
[4] https://www.mobileworldlive.com/featured-content/home-banner/qualcomm-drops-nxp-bid-reveals-iphone-blow/
[5] https://www.mobileworldlive.com/featured-content/top-three/wind-river-charts-iot-course-after-intel-split/

Intelligence Brief: Top 10 holiday spots for mobile fans

If you haven’t yet decided where you’re going to take your summer holiday this year, I have some good news and some bad news. I’ll start with the bad: time is running out. Seriously; you’ve got about a month before the unofficial end of summer.

The good news? Time hasn’t run out yet. Technically, summer lasts until the latter part of September, giving you ample time to pick a place, book your accommodations and get there. And while I can’t tell you where to go, I can make a pretty rock solid suggestion. Consider going somewhere significant in terms of mobile. A market which either teaches you something about mobility or carries some sort of historic weight. If you’re reading this, I shouldn’t have to explain why this is a good idea. Heck, it might even be a tax deduction or something you could expense.

Still need some more direction? Okay, here you go with my picks for summer 2018, including a few reasons why the whole family (not just wireless fans) might be interested.

Australia/New Zealand: Why? Per the latest update to the GSMA Mobile Connectivity Index [1] (powered by GSMAi), Australia and New Zealand come out on top, separated by about a single point. With solid networks, mobile broadband penetration over 100 per cent and incomes which support mobile usage, they provide good snapshots of mature markets where mobile broadband and connectivity are a given. Bonus Points: Kangaroos and Platypuses; great wine; super poisonous snakes (Australia); and spring skiing (New Zealand).

Uganda: Why? Our latest update to the impact of the mobile industry on the UN’s Sustainable Development Goals (SDGs) isn’t out yet, but I’ll give you a heads up on something: there’s some cool stuff going on in Uganda. Think Living Goods Uganda which uses a network of door-to-door health workers armed with mobile apps to drive improved health and well-being. Think mobile money-based humanitarian cash transfers [2] in the Bidi Bidi refugee settlement. Bonus Points: Primate tracking and safaris; Wakaliwood; and banana wine.

Sacramento, California (USA): Why? It’s one of the first markets where commercial 5G services are being rolled out – albeit based on Verizon’s 5GTF (technical forum) rather than the 3GPPs 5GNR specifications [3]. You’ll need to actively seek out these deployments and they might not be commercial when you get there. However, a trip to this early 5G market provides some cool opportunities to see how NR might compare with TF and how a new network supplier like Samsung might find its place in 5G networking. Bonus Points: proximity to Silicon Valley, Napa Valley and Lake Tahoe, the largest alpine lake in North America (for when you need to escape the sweltering summer heat).

Oslo/Stockholm (Norway/Sweden): Why? This is a historic choice. If you’re afraid that a trip to see initial 5G network launches won’t really show you much, then how about a trip to see the first LTE markets launched almost a decade ago? In the same way we all know 5G capabilities will evolve, checking out the state of LTE today in the Nordic capitals (with some of the highest 4G penetration levels in Europe) should be a telling exercise. Bonus Points: late evening daylight plus archipelago or fjord cruising; Nordic strawberry season; Trolls; Oslo Jazz Fest; and chocolate covered bugles.

China: Why? Though I’m an American, even I understand China is a big country and recommending it as a single location for a visit is silly. Point taken. But if you’re looking to understand the breadth of what you can do with IoT [4], China is a good place to start. Want to see a connected yak? Check. Want to see a connected manhole cover? Check. Want to understand how e-sim fits in? Check (look for more from us on this last point). Bonus Points: the Great Wall; pandas; beaches; Terracotta Warriors; and soup dumplings. Again, it’s a big country with a lot going on. If you can’t find something to keep the whole family busy, you’re not trying.

India: Why? At a little over 22 per cent, LTE penetration in India isn’t particularly high. Two years ago, however, the number was less than 1 per cent. All of this in a country with more than 1.3 billion people. Let that sink in for a moment. Even by 2025 it’s completely unlikely 4G penetration in India will catch up with China. Still, an opportunity to witness first-hand what happens when robust mobile broadband capabilities ramp so quickly doesn’t come around often. Bonus Points: see the notes on China above (big country with lots to see); sub-in the Taj Mahal; snow leopards; Chaat; and different beaches.

Niue (South Pacific): Why? Have you ever found yourself lecturing the kids about what it was like to live before 4G or 3G? Want to show them? Niue is one of a few markets with no (or almost no) options beyond 2G. There is WiFi in places but that’s not likely to do anyone much good when they want to post to Facebook or Snapchat (or whatever the kids are doing nowadays) when out and about. Bonus Points: caves; coves; beaches; rainforest; diving; dolphins; a golf course where pay is by an “honesty box” (if you never read another blog with my name on it, you probably know where to find me)

Greenland: Why? So you want to go to an island with almost no 3G or 4G coverage, but the South Pacific is too far, or too warm? Wonderful. Greenland is the place for you. It’s not all 2G, but it’s pretty darn close. Bonus Points: you can tell people you’ve actually been to Greenland and explain (over and over) how Greenland got the name which should have been used for Iceland.

Glasgow (UK): Why? Special events – like big concerts and sporting events – are real tests of mobile network capabilities. They’re also opportunities to leverage a solid network (and service delivery assets) in the name of services which go beyond simple connectivity. You’ve already missed the Fifa World Cup and Tour de France, but that still leaves the 2018 European Championships (part of which will take place in Glasgow) with 250,000 attendees expected. Will the networks hold up? Will carriers manage to provide “experiences?” The best way to find out is to be there. Bonus Points: Haggis; whisky; plus, I’ll be there (as a spectator, not competitor).

Los Angeles, California (USA): Why? Technically, September 12th to 14th is still within the summer. It’s also when Mobile World Congress Americas [5] is taking place. Official messaging stating the event will “bring together the brightest minds in the industry today, to imagine what tomorrow could bring” might seem like hyperbole. It’s not. And taking place in LA, it’s going to be an incredible opportunity to see the intersection of the mobile and content/entertainment ecosystems. Bonus Points: the beaches; sun; Hollywood; Beverly Hills; plus, just like Glasgow, I’ll be there too!

– Peter Jarich, head of GSMA Intelligence

The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.

[1] https://www.mobileconnectivityindex.com/
[2] https://www.gsma.com/mobilefordevelopment/programme/mobile-for-humanitarian-innovation/humanitarian-payment-digitisation-focus-ugandas-bidi-bidi-refugee-settlement/
[3] https://www.mobileworldlive.com/featured-content/top-three/3gpp-clears-5g-for-take-off-with-standalone-nr-specs/
[4] https://www.mobileworldlive.com/blog/intelligence-brief-iot-musings-from-mwcs/
[5] https://www.mwcamericas.com/