Deutsche Telekom unveils 1NCE-powered European IoT SIM offering

Deutsche Telekom has announced its new LTE Cat-NB SIM offerings, powered by the DT-spinout 1NCE’s connectivity management platform. The bundles can be used across the whole of the EU, and allow us to examine the price of LPWAN again. Unfortunately, it’s hard to draw any solid conclusions from the calculations.

However, it is good to see that MNOs are moving away from pricing devices on a per-message or per-month basis, and more towards a package that would price the device over its lifetime. In DT’s case, the LPWAN-focused offering is being sold as a five-year deal, but you are able to top the device up should you need to extend it.

There are two flavors. The first is called Business Smart Connect LPWA, which as the name implies, is focused on LTE Cat-NB but has 2G fallback, and provides a five-year contract. The second is Business Smart Connect M2M, focused on higher-speed LTE categories and 2G, available in three-year contracts.

There is a flat fee for the SIM card, with a lifetime allowance of data and 250 SMS messages that can be sent or received. The SIMs can be topped up, if needed, but it looks like it might be more cost effective to bump up a tier at the time of purchase instead of gambling that you won’t need to increase the allowance. There is also an eSIM option.

In terms of the cost, the LPWA package has three tiers. The first, called tariff S (for small), costs €7.95, and includes 6 MB of data, which equates to 100 KB per month on its five-year plan. The big thing to factor in here is the effective cost of having to push a new firmware image to the device in case you need to update it – as a 3MB top up for the S tariff costs €4.

The next tier up is M(edium), and costs €9.95 for 16 MB of data, equivalent to around 267 KB per month on the five-year time frame. Paying the additional €2 for an extra 10 MB sounds sensible, but if we’re talking millions of units, then it’s perhaps not in the budget. The highest is L(arge), and costs €12 for 30 MB of data – akin to 500 KB per month over five years.

The M2M equivalent is slightly more expensive, but has a lot more data in the buckets. The S tier costs €9 and gets you 300 MB of data, while M costs €17 for 1 GB, and L costs €30 for 3 GB. Having to top up will have customers reaching for their credit cards.

In the LPWA tiers, the costs are €4 per 3 MB in S, €5 for 8 MB in M, and €6 for 15 MB in L. In M2M, the costs are €4.50 for 150 MB in S, €8.50 for 500 MB in M, and €15 for 1,500 MB in L. You will note how radically different the cost of 1 MB of data is in each of these packages – €1.33, €0.63, and €0.40 in the LPWA tariffs respectively, and €0.03, €0.017, and €0.01 in the M2M tariffs respectively.

In terms of comparisons, AT&T announced its US pricing back in May, which have a monthly focus, rather than a five-year frame. Unsurprisingly, these are a lot more expensive, and clock in at around $1 per month ($14 per year) for a 500 KB monthly bucket. The 1 MB bucket costs $20 per year, with 5 MB costing $50 per year, and the 50 MB monthly bucket costing $144 annually.

So then, in terms of cost per MB, it all looks a bit arbitrary. We’re sure that both operators have run the models and determined that this is the best pricing structure, but such differences mean making direct comparisons a bit redundant. In terms of the smallest tiers, AT&T costs $14 a year for 6 MB of data, while DT’s pricing works out to €8 a year for the 6 MB – but of course, in DT’s world, you would have depleted the five-year allowance in one year, and replenishing the 6 MB the next year would cost you €8 again.

On that basis, it is easier to think of DT’s option as costing €8 per year, and in the current exchange rates, that works out to $8.86. However, if you follow DT’s line of thinking, that the 6MB is plenty for five years, then buying the equivalent package from AT&T is going to cost $70, compared to the $44.30 – or around 1.58x as expensive.

However, the more direct comparison is the L tariff from DT, with its €12 five-year price and 30 MB bucket, which lines up nicely with five years of AT&T’s 6 MB package. On that basis, the two services have massive variations in pricing – with DT costing $13.30 and AT&T costing $70, or rather, the same data bundle in the USA costing 5.2x as much as it would in Europe.