Nokia has announced that joined ConectarAGRO, an industry group in Brazil that is looking to bring IoT technologies to the agriculture market. The group consists of local MNO TIM, likely Nokia’s main partner here, as well as major agribusiness vendors; AGCO, Bayer, CNH Industrial, Jacto, Solinftec, and Trimble.
For Nokia, this is a sensible way to snare new business – cozy up with the local MNO (already a Nokia customer) and sell through this channel to a new vertical market or industry that needs IoT platforms and services. This tactic is replicable, in both the same country and same vertical, and can be exported to other territories too, so should drum up good numbers for its WING platform offering.
ConectarAGRO says that it will bring connectivity to the 93% of Brazilian farmers that currently have no access to wireless broadband – around 500,000 farms. TIM will be using Nokia to improve this, using 4G coverage to support IoT and precision agricultural technologies. These include connecting farming equipment fleets, robotics, temperature and moisture sensors, and drone aerial images.
For Brazil, farming is a major strategic market. ConectarAGRO says that the segment accounted for 23.5% of GDP in 2017, and 80% of GDP growth. Consequently, if ConectarAGRO can provide efficiency and yield improvements here, it would be to the benefit of the national economy.
Luiz Tonisi, Head of Market Unit Brazil at Nokia, said that “the ConectarAGRO initiative provides an industry-coordinated approach to facilitate the development of these precision agricultural technologies for Brazil’s farmers. This open approach will help to spur innovation by creating an ecosystem of companies that can support the digital transformation of the Brazilian agricultural sector. The Nokia team is very pleased to help realize Agriculture 4.0 for Brazil’s farmers.”
Unfortunately, it’s all a little boring, at least from a news-writing perspective – and we categorically refuse to add ‘Agriculture 4.0’ to our vernacular. There are no grabbing headlines, no bleeding-edge use cases, just an opportunity to connect prospective IoT devices to a network, and take a slice of this new revenue.
To be clear, the agriculture market is a big one, and there are major efficiency savings to be reaped if IoT technology is sown properly. However, at the network level, we have always been skeptical of the enthusiasm from MNOs to enter these markets, mainly based on return-on-investment expectations from expanding LTE networks to get adequate rural coverage.
For MNOs that already have LTE coverage in the fields and ranches, this isn’t really applicable, but the U-LPWAN community has high hopes for agriculture on the basis that the MNOs don’t have sufficient coverage here. What’s more, a handful of LoRa gateways on a farm could provide a much cheaper option for applications like soil quality sensing and livestock tracking, than a L-LPWAN alternative – mostly due to the different business models of the MNOs.
Broadly, the MNOs are approaching IoT applications in the same manner as they have done in consumer markets – that there is a per-use cost for sending data over the network, and a finite bucket of data available per tier, sold on a monthly allowance.
For many IoT applications, this is a very expensive way of doing things. If you have an alarm application, where an alert needs to be sent if a sensor threshold is met, such as water leakage, you might only need a single weekly or monthly message to be sent – to check in and report that the sensor is still active. In the context of the bucket approach, paying for a higher allowance of unused messages is extremely wasteful, especially when what this alarm application needs is a guarantee that when the alert needs to be sent that the message will definitely make it through. What’s more, battery-constrained devices can’t simply make use of the extra unused messages in the bucket, as every message sent depletes the battery reserve.
Most battery-constrained applications are also going to favor delta-based messaging, where communication is only made if a sensor reading exceeds pre-defined parameters. In an application such as water level monitoring, there’s no point sending updates that say the tank is still full. What you’d want to know is that the tank is now below a fill threshold, and again, that’s likely to be an infrequent message.
This is especially true in agricultural applications, where a lot of the IoT demand for sensing is for monitoring tasks. The rancher doesn’t want to know that all of their thousands of cows are still doing normal bovine things; they want to know when a single cow is showing signs that intervention is needed. The farmer doesn’t need to know that their soil is still moist; they want to know when it has passed a point that could lead to crop losses.
So, if the MNOs collectively fail to find a way to price their offerings to suit these sorts of messaging demands, they risk being dislodged by the U-LPWAN rivals – who can slap a LoRa gateway on a barn, sling you a few sensors, and only charge a small monthly fee. The MNOs have all the usual advantages of incumbent brand power and sales channels, but profit-pressured farmers are not going to pay for services they can’t afford.