M2M service providers and LTE: New revenue opportunities

M2M service providers and LTE: New revenue opportunities

Service providers around the world are spending billions of dollars rolling out new LTE infrastructure. Operators worldwide including T-Mobile, China Mobile, AT&T, NTT DoCoMo, Sprint, Telstra, Vodafone and Telefónica have already deployed LTE services. Although 4G-enabled mobile phones and tablets are driving the adoption of LTE, say u-blox’s Herbert Blaser and Carl Fenger, new billable services in the M2M sector are already appearing.

Operators are looking at new revenue streams to capitalise on and amortise their huge investments in LTE network infrastructure. M2M data services will help fill the gap. Here are some examples of new LTE-powered applications.

Car information and entertainment systems

Vehicle-mounted LTE routers will enable high-speed downlinks of up to 100 Mbit/s (LTE category 3) to the car. This is enough to support 5 parallel high-definition TV channels, and more than enough to support the more typical mix of video, voice, internet access and social media applications used by passengers.

Business models:
Operator revenue from vehicle LTE services will be based on well-known business models used for mobile phones; traffic-based, flat rate, local or wide-area roaming, plus subscription to services such as a digital tour guide and on-demand TV content.

Remote security systems

LTE will enable the cost-effective placement of streaming video cameras in covert and hard-to-reach areas. LTE will make it economically viable to remotely monitor warehouses, retail outlets, unmanned utility stations, factories, healthcare facilities, airports, prisons,  schools, hotels, sports facilities and residential property.

Business models:
Operators will be able to bill for security services based on equipment installation, equipment provisioning and leasing, management software, hours per day used (for example, only after shop closing times, or only when motion is detected), and cloud-based storage of video streams.

Digital signage

LTE will make the transmission of large multimedia files cost-effective. Current paper-based signage and advertisements that require frequent manual updating with glue and paper will be replaced by rich graphical and video displays that can be updated or rotated automatically over-the-air.

Business models:
Operators will develop revenue streams that include the LTE data service bundled with equipment/signage provisioning and leasing, bandwidth usage, and advertisement revenues.

Cloud storage and hosted applications

LTE will allow the quick storage and retrieval of  terabytes of data, even from remote areas where there is no high-speed fixed line connection. This will allow businesses to operate far from cities or fixed line access points.

Business models:
Operators can charge for cloud storage, hosted applications, access licences and bandwidth usage. Cable and ADSL both require a physical connection to the home. As the price for LTE connectivity drops, a wireless 4G connection directly to a WiFi router will replace these connections, decreasing costs, eliminating installation and service calls, and lowering the cost of connections to new buildings where a single LTE to WiFi router could provide service to hundreds of residential units.

Business models:
Similar to current ADSL/cable subscriptions with reduced installation, equipment and technical support costs.

Telehealth services

As healthcare costs soar and patient-to doctor ratios increase, LTE will help lower healthcare costs by providing remote care via a high quality video link.  Instead of sick or elderly patients having to travel to the doctor’s office, a telehealth terminal at home can provide instant access to a doctor or other healthcare professional.

Business models:
Telecom operators have the opportunity to develop business with private practices, hospitals, or assisted living organisations similar to mobile phone services including equipment rental, network usage, monitor queries, as well as fixed-location or roaming capabilities.

Homeland security

Although there are significant privacy issues to be resolved, governments are increasingly spending on security, particularly in the USA, and at security checkpoints at airports, events and borders around the world.
To automate authorisation, LTE will enable facial recognition not only at places of entry and exit, but over large areas where cameras can pan across hundreds of faces moving in a crowd.

Business models:
This is an opportunity for service providers to sign contracts with government and private security agencies to deliver the underlying LTE connectivity, to lease equipment as well as host services, and to provide access control and secure storage.

LTE location-based services

LTE connectivity combined with satellite-based (or other) global positioning systems will give operators the ability
to offer new types of services. Some examples include:

Enhanced shopping and tourism
Vision is our primary sense, video-rich LTE services will improve many services, with position-relevant content that enhances the mobile shopping and tourism experience.
Multimedia navigation
Beyond a virtual thumbtack and a red route drawn on a map, LTE will allow users to see and interact with destinations before they actually arrive, and to preview landmarks along the way.
New social media applications
Video interaction combined with location information will enable new forms of social media  such as proximity dating, as well as catalysing and enhancing social movements, demonstrations, political rallies, and sporting events.

Business models:
All these services can be hosted on any LTE-enabled mobile device, giving operators the ability to provide traditional telecom services in addition to charging for enhanced features such as location-relevant videos, historical data, information about friends, family (and possible new friends) in the vicinity of the user.

Vending machines

Vending machines are a global business that will generate over US$190 billion in revenue by 2015 according to global industry analysts. LTE will bring video-rich multimedia advertisement and social media possibilities to vending machine displays.

Business models: 
LTE service providers can charge either flat-rate for a video pipe, or collect revenues made on products sold while specific videos were played. Alternatively, product providers can pay to have their promotional videos played on the machine.

Time-critical systems

LTE’s low-latency, typically around 10ms, is especially attractive for time-critical applications such as industrial, traffic control (vehicle-to-infrastructure communications), (potentially) collision avoidance (vehicle-to-vehicle
communications) and financial systems where splitsecond reaction times are crucial for industrial robots, traffic-flow control and automated financial transactions.

Business models:
LTE provides this high quality of service demanded by time-critical applications. LTE provides clearly defined Class and Quality of Service levels guaranteeing minimum bandwidth, bit error rate, and latency. This is a premium LTE service that network operators can earn new revenues from.

u-blox’ LTE vision

LTE will establish high-speed, low-latency wireless internet access as a universal utility, available everywhere, on any device. In combination with IP version 6, a practically limitless number of machines will be connected to the network using a common protocol. This will have a tremendous impact on how and where humans communicate, as well as on human-tomachine, and machine-to-machine communications.

TOBY LTE module series

u-blox’ first LTE module family, TOBY-L1, is a range of compact, cost-optimised LTE data modems targeted at many of the embedded wireless M2M applications outlined previously.

• LTE-only LGA module in the industry’s smallest formfactor: 24.8 x 35.6 x 2.8 mm
• LTE Cat. 3, 100 Mb/s download, 50 Mb/s upload
• Easy migration from u-blox UMTS, CDMA and GSM modules (“nested design”)
• Variants for Verizon (USA) & European operators
• Extended temperature range: –40°C to +85°C
• Manufactured in ISO/TS 16949 certified production sites

Future generations of u-blox LTE modules will be based on the company’s long-term strategy; to quickly adapt to changing connectivity requirements in industrial, automotive and consumer applications based on inhouse intellectual property, while maintaining formfactor continuity.

M2M Now Jargon Buster:

ADSL = Asymmetric Digital Subscriber Line
LTE = Long-Term Evolution to 4G

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