IoT Won’t Be Cash Crop for Carriers
The CEO of Northstream, Bengt Nordstrom, in a recent article in European Communications, had some pretty eye-opening things to say. In talking about the role of the IoT for mobile carriers and operators he said,
“Some of the larger operators that entered this market some years ago, and are really betting on it, might have chance of getting three to five percent of their revenues from the IoT.”
However, Nordstrom then explained that most operators the IoT would only contribute about 1 percent of their total revenues. Nordstrom continues,
“If that’s correct, then we can basically say that the IoT can’t pay for infrastructure – it has to be in place already for [traditional] operators to make profitable business on it…”
In other words, the IoT is a drop in the bucket for them, which means they won’t be dedicated to their customers. They won’t be dedicated to the technologies they do deploy and will have no qualms about leaving their customers behind…again. That’s the rub, they are leaving their customers high and dry already. AT&T decided to abandon 2G at the end of 2016 and Verizon will be done with it at the end of 2019. The carriers are forcing their customers to either use costlier LTE or seek connectivity elsewhere.
And it is only because startups like Ingenu have developed IoT dedicated wireless technology—and have gotten the attention of application developers—that the carriers have tried to save face. But as Nordstrom has stated, the IoT is not their main source of income, far from it, and they will never place their IoT customers’ needs above their other higher paying customers.
The message couldn’t be clearer. Any business looking to use the IoT for more than a few years should not look to the carriers. Their IoT customers do not matter to them. It isn’t personal; it’s business. When you are only one to five percent of a company’s revenue, you won’t ever be the priority. Their customers could disappear today and the carriers would barely notice (like their 2G customers). But to innovators like Ingenu, who exist solely to provide connectivity to the IoT, our customers are and always will be our only priority. Their success is our success. Period. We’ve built from scratch the world’s only low-power, wide-area wireless solution and we want your business to thrive always. IoT connectivity that works. Simply Genius.