With 3 billion connections LPWA ‘will dominate’ wide area wireless connectivity for M2M by 2023

Machina-Research

Over the past 18 months, Low Power Wide Area (LPWA) networking technologies have emerged from the shadows and are now centre stage: Sigfox recently announced a US$115 million round of funding, Neul was acquired by Huawei in late 2014, and a new alliance of major technology players has coalesced around Semtech’s LoRa technology.

Vodafone announced that it will become the first operator to introduce Huawei’s Cellular IoT (CIoT) LPWA technology, and Huawei and Vodafone intend that the solution will be published as an open industry standard by 3GPP so that it can be adopted by the wider mobile ecosystem. This is a sub-sector that is on fire. According to the latest forecasts from Machina Research by 2023, there will be over 3 billion LPWA M2M connections, outstripping cellular technologies.

Many M2M applications are potentially well-suited to a range of emerging technologies collectively termed Low Power Wide Area (LPWA) networking technologies. Examples of such technologies and providers include Amber Wireless, Coronis, Huawei’s CIoT, LoRa, M2M Spectrum Networks, NWave, On-Ramp Wireless, Senaptic, Sigfox, Weightless, and many more. Many of these technologies have been present in the market for some time, whilst others are relatively new entrants. For instance, GE have effectively been a value-added reseller of On-Ramp connectivity for years (powering connected smart meters), whilst Huawei’s CIoT solution has only recently been announced. However, it is really Sigfox’s audacious ‘Sigfox Network Operator’ strategy that has recently kick-started the market, resulting in the entry of industry heavyweights such as Arqiva into the LPWA M2M space and prompting the established cellular industry to respond.

Machina Research has long been a believer in the potential for Low Power Wide Area (LPWA) connectivity. We first forecast the market opportunity for such technologies in early 2013 (and we claim to have introduced the term LPWA to the market as a result). Many M2M applications are well suited to the key characteristics of these technologies, characteristics which include:

  • Low cost communications modules and supporting networks (potentially allowing for wide area coverage to be added to a device for USD1 incremental bill of materials cost)
  • Low bandwidth communications only (often consisting of just a hundred or so bytes of information)
  • Long battery lives (often up to 10 years from a single AA cell)
  • Wide area coverage (countrywide in the case of some technologies, ‘campus-wide’ in the case of others)

Our latest set of forecasts, updated in February 2015, found that there would be over 3 billion LPWA connections by 2023, by which time they would collectively be the dominant form of wide area M2M connectivity technology.

Commenting on Machina Research’s analysis of the LPWA market, chief research officer Jim Morrish said “Exceeding 3 billion connections in 2023 will be a remarkable feat for a set of technologies that did not even have a collective name until 2013. Traditional cellular technologies have been bumped to number two spot, although the overall effect of the emergence of LPWA technologies is expected to add wide area connections, rather than to substitute for cellular connections.”

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