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20 March 2020

Sigfox and WND brace for UK uptick, battle skepticism

Another MWC casualty; we were not able to fit in a Sigfox catchup – the LPWAN upstart that we can never quite write-off, as it is only one big deal away from a miraculous recovery. The recent Eutelsat partnership adds some clout, but for a long time, Sigfox looked like it was circling the drain. Still, it’s not yet dead, and has made progress in the UK.

This led us to talk with Ana Maria Giménez, Sigfox’s lead for Business Development and Strategic Partnerships, and Peter Clarke, WND’s Sales and Marketing Director. Clarke noted that despite the UK network being quite comprehensive, it is not much talked about, which of course prompted us to point out that there is still an immense amount of skepticism concerning Sigfox, based on the climb-down.

To this end, we put it to Giménez that Sigfox was not far off declaring itself an asset tracking technology, given recent deals. Giménez countered, saying that many customers are more interested in asset usage optimization, rather than the actual tracking element, where tracking is an aspect of the total stack. Giménez also pointed to Sigfox’s deal with Free, a French telco, where it is providing backup connectivity for home security alarm panels – a deal very reminiscent of its Securitas contract.

There are also some utility users that are not quite public yet, said Giménez, and Clarke stressed that asset tracking is really the low hanging fruit, and that other use cases are going to come to the fore in time. For asset tracking itself, Clarke said, it is generally focused towards creating a more efficient supply chain, and that users will very quickly stray into the Big Data realm, once they start housing all the tiny bits of sensor data.

Here, Clarke said that utilities were quite slow moving, but that they are coming down the track, so to speak. Direct marketing is also another promising venture, apparently, where Sigfox connectivity can be added to packaging to enable more immersive consumer experiences. The feedback and engagement from those trials have been very impressive, according to Clarke. As for another area that looks promising for Sigfox, Giménez pointed to elderly care and aging-in-place, where Sigfox can connect devices used to keep tabs on people.

With some looking forward out of the way, we wanted to hear what WND had been up to these past two years. Clarke explained that the UK network is now wholly run by WND, meaning that Arqiva’s infamously poor rollout is now naught but a bad memory. Clarke said WND had taken over completely around 18 months ago, but that this time has been spent reinforcing the network at existing sites, and then expanding into new areas – filling in the very large gaps that were present in Arqiva’s footprint.

WND now has just shy of 2,000 sites, up from 125 or so those 18 months ago. Clarke said he wasn’t familiar with the details, having only recently joined WND, but his understanding was that Arqiva took a very telecom-centric view of how to deploy this Sigfox network, based on its traditional radio and broadcast infrastructure businesses.

This approach, Clarke said, would work well in 2G, 3G, and probably 4G, but that in the LPWAN world, it was entirely the wrong approach. Clarke pointed to the £21bn in revenue generated by 3G, as a cost that then has to be offset in the connectivity pricing. In the LPWAN realm, where subscriptions are measured in pennies per month, you can’t take that telco view, and need to keep the network deployment costs as low as possible.

Arqiva ran into problems when it found out that the rollout was much more expensive than anticipated, with Arqiva having to rent expensive locations in order to provide coverage – as its towers alone were not enough. WND, in contrast, has focused on keeping its costs as low as possible, said Clarke.

We asked Giménez for the Sigfox perspective, as these Sigfox Network Operators (SNOs) are the boots on the ground, so to speak, building the platform that Sigfox is trying to monetize. It is, after all, not a good look that Arqiva couldn’t deploy a Sigfox network in the UK, in a profitable fashion.

To this, Giménez noted that Sigfox is looking to drive high volumes of devices, and that this is what makes WND profitable to Sigfox itself. To this end, letting WND get the groundwork in order is not a problem. Clarke also jumped in, noting that it’s not just Sigfox that’s behind the curve – that analyst predictions for IoT growth have been out of whack, citing the infamous 50bn by 2020 benchmark.

However, WND is about to see a dramatic increase in devices, according to Clarke, as it has a host of proof of concept deployments that are graduating to live deployments. Clarke also says those aforementioned direct marketing efforts could very quickly scale up, based on the performance figures.

There are similar scalings happening in the Sigfox global customer base, said Giménez, where the likes of DHL and PSA place six figure orders to track equipment across Europe. However, these larger deals still take time to rollout, and this is where we asked how many of the 15.4mn ‘registered’ devices are actually live and deployed currently. Giménez wouldn’t say, and Clarke could also not tell us how many devices are live in the UK.

We asked the pair about their thoughts on the recent LoRa developments, with asset-tracking being at the heart of a new 2.4 GHz offering, which we think muddies the water substantially. The two would not be drawn to hurling aspersions, with Clarke noting that WND is very focused on its own offerings, but quite aware of the amount of noise being generated by the approach of Cat-NB.

Here, Clarke noted that if the IoT does scale to that 50bn mark, there is going to plenty of room in the market to determine which technology to use according to the specific use case. To this end, Sigfox’s ‘0G’ approach, of playing way below the applications that its U-LPWAN and L-LPWAN competitors have focused on, would set it apart, if it can prove that it is the best technology for the use case at hand.

As is the case with most interviews, we closed by asking what threats lurked on the horizon, to which Giménez pointed to the macroeconomic impact of the current COVID-19 pandemic. Clarke added that driving out a proposition to a market is hard enough at the best of times, never mind one that is preoccupied with a global pandemic.

Giménez noted that this market used to a pilot party, full of projects where everyone wanted to have a go at the IoT puzzle. Now, it has moved into a more industrial phase, where you have to be able to actually generate revenue. The sales pitch is to ask a customer what data they would dream of having, and then showing them how adding up all the small sensor readings comes to form a very big business case, from the combined value of all those connections.