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4 July 2016

Cisco endorses LoRa for Industrial IoT, as KPN and SKT take it nationwide

The 3GPP may have finalized its NB-IoT specifications (see separate item), but one of the rival technologies in unlicensed spectrum, LoRa, is already pushing into networks with national, commercial coverage, and has attracted heavyweight support from Cisco.

The fact that large cellular operators – in this case SK Telecom of Korea and KPN of The Netherlands – are deploying LoRa at scale, even with a 3GPP alternative on the horizon, suggests that the unlicensed spectrum LPWANs (low power wide area networks) will play a significant role in the future IoT – and not just for operators which lack access to licensed spectrum. For some services which do not require the security and guaranteed QoS of licensed bands, technologies like LoRa or UltraNarrowBand (as used by Sigfox, Weightless, Telensa and others) can be optimal in terms of power, cost, efficiency and time to deploy.

KPN says The Netherlands is the first country in the world to have a nationwide LoRa coverage, which it has achieved just seven months after switching on its first base stations in Rotterdam and The Hague in November. It has rolled out the network using its existing towers, mounting LoRa gateways and antennas to hundreds of sites.

The operator says 1.5m devices are now connected to the network and it “expects LoRa applications for consumers to become more widely available in the course of this year”.

The carrier’s COO Joost Farwerck commented: “Last year we identified an increasing demand for low power network technology for Internet of Things applications. We are responding to this by choosing LoRa, so millions of devices can be connected to the internet in a cost-effective manner.”

In Korea, SK Telecom says it has deployed the world’s first hybrid nationwide network for IoT services, rolling out LoRa alongside its low power LTE system, based on prototype NB-IoT kit.

The dual network is part of its KRW100bn ($87m) investment in IoT between now and the end of 2017. That spend is targeted at leadership of the firm’s domestic market, but it also says it plans to “enter the global market alongside our partners once we establish an ecosystem in the domestic market,” as EVP Cha In-hyok put it. He added: “The domestic market is only 2% of the entire global market. We will push for our IoT business to focus on the global stage in the long run.”
More immediately, Lee Hyung-hee, president of SK Telecom’s network operations division, said: “The LoRa-based network is expected to dramatically boost the supply and demand of IoT devices and services as it has solved issues in energy efficiency and cost.”

He acknowledged that some of the growth would be at the expense of SK’s existing 2G-based M2M offerings, saying: “Dramatic changes may include a huge sales decrease in our existing machine-to-machine business such as the remote metering service, because the new services will drop prices. But we believe that such self-destructive innovation will lead to opportunities greater than the sales decrease.” The lowest tariff which SK will offer for its new IoT services is KRW350 ($3) a month – less than one-tenth of current M2M service prices.

SK Telecom completed its low power LTE deployment in March, and says that will be software upgradeable to fully standard NB-IoT if necessary. LoRa complements that, it said, in terms of coverage, and its target applications. NB-IoT will be geared to slightly higher data rates, while LoRa will support ultra-low power applications. And by adding LoRa, SK can achieve 99% population coverage and 90% land mass coverage, though it still aims to improve in-building penetration.

To offset the lower ARPUs, SKT needs mass uptake, which it will drive not only with improved coverage but a wide range of services targeted at different user bases. Among these, it said, are an advanced gas metering network and wearable device services designed for the safety of children and the elderly. It will also initiate about 20 new services, such as manhole monitoring and smart parking, in cooperation with regional governments this year.

To extend its services, the operator will issue an application programming interface and software development kit while opening test facilities in Bundang this month. It is also issuing 100,000 LoRa modules to partners to encourage the development of new services.

Meanwhile, Cisco has launched into the LPWAN market with the release of a gateway and adapter module that provides LoRa connectivity as well as WiF and cellular links to Cisco switches.

Connected machinery, especially in the enterprise and industrial IoT sectors, are a huge opportunity for Cisco. In a blog post entitled ‘Cisco Digitizes Industrial Solutions with IoT’, the firms said that 92% of the 64m machines that are deployed today are not connected to a network. The increasing benefits to be gained from making these machines internet-connected, and the improved technology for doing so, will drive corporations to start hooking up their equipment – as long as fears about security and other issues can be addressed.

Customers already using Cisco’s IR809 and IR829 industrial routers will be able to use the new Cisco Integrated Module for LoRaWAN, and the Field Network Director application will automatically manage the device provisioning, certificate management, firmware upgrades, and the LoRaWAN packet forwarder (LRR) software – for getting packets to the network operator’s server.

Cisco is using the Hamburg Port Authority (HPA) as a shining example of the potential for its new products. The HPA will use the Cisco LoRa solution to help monitor the Kattwyk Bridge at the port’s entrance – this has to be raised and lowered to allow cargo ships through. The HPA isn’t using LoRa to control the movement of the bridge as yet, but is relying on LoRa sensors to provide its technical maintenance department with data to use in predictive maintenance applications – which should help the port, one of the largest in Europe, to reduce its downtime.

“Right now, the use of LoRa technology and sensors along the bridge help us tremendously improve operations,” said Sebastian Saxe, CIO and CDO of the HPA. “We no longer have to wait for a problem, but can proactively address issues before they arise.”

Use cases like Hamburg are going to be the sales tools that Cisco uses for expanding its footprint in the IoT. The business decision makers are the ones that need convincing of the merits of new technologies like LPWAN, and being able to point to real world commercial improvements should be a persuasive element of any sales pitch.

Cisco is also offering its Connected Machines solution, aimed at manufacturing customers that want to add data analytics and predictive maintenance to their installed devices. The Connected Machines package is an extension of the Cisco IoT solution, which also includes new hardware.

The IE4000 switch is going to see a new application framework called IOx, which will allow users to run applications on the switch itself – as part of Cisco’s Fog Computing iniative to move the computational power closer to the source of the data (the ground). IOx promises to integrate IoT sensors with cloud applications, and the Connected Streaming Analytics package aims to provide real-time analytics for the data generated by the IE4000.

Mazak is using the new Cisco product as the basis of its SmartBox, with the IE4000 router and the MTConnect fog application allowing customers to connect industrial machinery to a cloud application.

Cisco itself is also offering the Cisco Connected Factory product, which centers aruond the IE4010 ruggedized switch, the lightweight IE1000 switch, and the ISA3000 threat-detecting security appliance. Combined, Cisco is pitching this at customers looking to improve the efficiency of a manufcaturing process, rather than simply monitor it.

Cisco points to Lordan, a maker of thermal-engineering heating and cooling systems, as an example of the ideal customer. Lordan used a Cisco 829 Industrial Router, with IOx and the LeaderMES fog application.

“Within two weeks, we could produce overall equipment effectiveness (OEE) reports and make decisions based on real data, not assessments. Within a month of installing LeaderMES, we increased our manufacturing floor productivity by over 10%,” said Yair Avigdoor, Lordan’s COO.

As we watch the IoT take shape, we’re convinced that the real money to be made will be via platforms – the ability to show a business exactly what you can bring to their table on the back of IoT technologies. As such, the largest businesses in the IT and OT market are natural candidates to offer these platforms to the largest enterprises.

Consequently, smaller companies and start-ups need to work out where they will slot into these platforms – for example, as hardware vendors that sell to the platform, or perhaps software houses that have reselling agreements. Of course, there will be opportunities for smaller companies to sell directly into these enterprises, but the easiest route to market (and volume) seems certain to be through the platform offerings of larger players.