US and European cities are signing Internet of Things deals – but will they be used?

Profile picture for user ddpreez By Derek du Preez May 27, 2014
Summary:
There's been a flurry of announcements recently, but there are still questions about the use case and who's going to take advantage of this potential cash cow

I recently attended a Cisco event in London, where the networking company put out some research stating that the Internet of Things, or the Internet of

Social Network Interface
Everything as they called it, is going to be worth an estimated $19 trillion by 2020. The piece I penned off the back of the event was not about the amount of money up for grabs – although certainly not a trivial amount – but about who was going to make this idea of a connected world and real-time data retrieval from everything around us a reality. There was some dispute amongst attendees about whether the market needed a kick start from one company – as Apple did with the smartphone market – or whether it would develop over time with a diverse range of players working on top of interoperable systems and open standards.

However, Dr. David Shipworth from University College London's Energy Institute used a description for the potential of the IoT that I really liked. He said:

“What we are in the process of doing now is constructing society’s central nervous system. We have started constructing social media, the social brain, the big data analytics, the things that have allowed us to process data and come up with findings. But we have little capacity to sense our world – it’s a lot about sensors and actuators being deployed in large numbers and at scale, which will allow us to start to get feedback about the world that feeds into our capacities in cloud computing and big data analytics.”

Since that event a couple of months ago I've noticed a flurry of announcements around some cities in the US, the UK and the rest of Europe signing deals with companies to deploy city-wide dedicated IoT networks. Although the deals have only recently been done and the use case still isn't totally clear, I thought it was worth highlighting as an interesting development.

The deals done

One of the companies making good headway in this area is Sigfox, a French cellular networking company that is dedicated to the Internet of Things. Sigfox has already rolled out its network across the whole of France by adding its own equipment to existing cell towers, which works by tapping into free spectrum that transfers information at a much slower rate than 3G or 4G, but is still suitable for a number of M2M applications. For example, one of its customers is French insurance company MAAF, which offers smoke sensors and uses the network to send home owners a text message when a sensor is triggered. Because Sigfox doesn't use high bandwidth consumption devices, it's energy consumption is a lot lower, and as a result, its costs are a lot lower. It believes that this, combined with the fact that the Sigfox protocol is compatible with the majority of existing transceivers, it is in an ideal position to take advantage of the IoT.

And it seems that its idea is catching on. The company has since moved into a number of other European territories, including Spain, Germany and the UK, as well as signing deals to launch networks in San Francisco and San Jose. The company is also reportedly extending its US coverage to up to 10 more cities in the next 18 months.

Rodolphe Baronnet-Frugès, vice president of network and business development at SIGFOX, said:

“According to some forecasts, there will be 50 billion connected devices worldwide by 2020, but for this to become a reality, both cost and energy use will have to come down. That’s the solution SIGFOX offers.”

concrete cow
A separate UK announcement emerged this week, where a consortium of tech companies (namely BT and Neul), are working with Milton Keynes Council and the Open University to build a city-wide, open access network for M2M communications and the Internet of Things, based on wireless communications. For those that are unaware, Milton Keynes is a very non-traditional British town that was built up in the late 60s to relieve housing congestion in London. It is designed around a grid system, much like most US cities, and is famous for its hundreds of roundabouts and concrete cows (don't ask). However, despite often being the butt of everyone's jokes, Milton Keynes has a strong focus on innovation, and has many digital initiatives, with a particular focus on smart cities and open data.

The press release for the new M2M and IoT project states:

“The project will demonstrate the ability of a city-wide M2M infrastructure to cope with a large number of static and mobile sensors. Some of these will support use cases for Milton Keynes council, but the mission for the project is to attract many other innovators to use the infrastructure as a test bed for commercial applications which need not be specific to Milton Keynes.”

Geoff Snelson, director of strategy at Milton Keynes Council, praised the initiative and said:

“Milton Keynes is already known as a pioneer in the use of technology to make our city more efficient, as evidenced by the current MK:Smart project.

“This agreement demonstrates our commitment to extending that to a city-wide level of
access. As well as providing a test-bed for our own specific use cases, this will bring new innovation and business development to the city, creating an ecosystem of IoT development.”

Verdict

  • As I said earlier, these deals are just being done so it's quite hard to quantify how successful/useful they are and whether or not they are going to really create this 'central nervous system' for the people living in the cities mentioned. It's also quite difficult to say whether or not these networks will be the core networks used going forward, given that competition for a piece of the IoT pie is going to only increase. However, at the very least, they are interesting pilots to keep an eye on.
  • The problem with these announcements is that the network is the least interesting part of the IoT – yes it provides the connectivity layer that is required
    Smartphone with cloud of application icons in consumer hand
    for devices and M2M communication, but it's the application layer that will prove to be critical. Getting companies to buy into this and spend R&D money on creating use cases that appeal to people is critical. At the moment I can't think of many IoT applications that have been offered to me, if any, that I've had a strong enough desire to use.
  • However, I think the low energy and cost argument being put out by Sigfox and Neul is a strong one. By bringing down the costs for connecting sensors and devices, the IoT idea becomes far more accessible to people wanting to create interesting applications to test and develop on top of the network. The ability to try and fail cheaply will be key.
  • Watch this space.