Hundreds of millions of dollars have poured into the low-power wide-area (LPWA) IoT connectivity market over the past 2 years alone to kick start a fledgeling ecosystem of companies across a wide range of products and services. In the process of due diligence and research in this market that we undertook at Xona Partners, we find the following key drivers for investments:
1- Competitive landscape: LPWA fills a void not provided by either cellular technologies or short-range connectivity solutions based on point-to-point or mesh technologies such as 802.15.4, ZigBee, and WirelessHART. The LTE roadmap will not provide a comparable solution to LPWA for 2-3 years. Short-range solutions have practical operational and deployment limits. Mobile network operators investing in LPWA are particularly aware of this window of opportunity as they seek to preempt competition.
2- Business models: LPWA promises to drive new revenues either by creating new business models based on public area networks (e.g. SigFox), or by creating standards for public and private area networks (LoRa, Weightless). This commoditization of connectivity is set to open the IoT market opportunity.
3- Market opportunity: LPWA enables new uses cases not otherwise possible with other technologies. Today, LPWA serves well known applications. The on-demand spot-connectivity nature of LPWA is yet to generate new applications that ‘we did not think about’ before. But this could start happening soon as public IoT networks become available and connectivity is commoditized. The possible applications are nothing short of astounding!
The challenge for ecosystem players and investors alike is developing a grasp of this market where confusion exists in part due to complexity, and in another part due to competition between a large number of companies (over 9 LPWA technology options; over 5 3GPP technology options and many other short range technologies).
Note
We have published a research report on LPWA where we provide answers to critical questions such as:
- How do the LPWA players stack up against each others in both technology and business models?
- What is the impact of spectrum regulations on LPWA performance and how it differs from region to region?
- How much investments required to build LPWA public networks in US and Europe?
- What is the competitive threat to LPWA from LTE and other technologies?
- What are the applications best suited for LPWA?
- What are the value drivers in the LPWA market?
- What can we expect in the next 4 years in this market in terms of deployments and competitive moves?
The report provides detailed technical and financial analysis of LPWA and LTE networks. We cover 9 LPWA technologies, 3GPP technologies and roadmap, and other short-range technologies competing with LPWA. To assess and compare performance, we looked at link budgets, capacity, power consumption and other critical parameters. We also cover spectrum issues related to duty-cycle, power limits and other regulations that impact performance. We cover the business models pursued by different companies in the ecosystem and map technologies to 86 IoT applications to clearly identify where each competing option can play. For more information, refer to the table of content and/or contact me.