British telecoms company Vodafone has claimed to be the first Internet of Things (IoT) mobile provider to surpass 50 million connections, but how useful are these figures?
In a statement earlier this week, the company said it is seeing growth of roughly one million connections per month, with particularly strong performance in the automotive, healthcare and utilities sectors.
“Vodafone was one of the earliest believers in the potential for the Internet of Things to transform business and life. The 50 million milestone is a testament to our continued focus and commitment to innovation in this rapidly growing and dynamic sector,” said Vodafone’s director of IoT Ivo Rook in an official statement.
The company claims that the growth indicates that IoT technologies are now beginning to reach critical mass in the enterprise and are becoming a core focus of research and development for a wide range of consumer technology companies.
It also points to its most recent IoT Barometer study as further evidence. This survey of more than 1,000 senior executives was carried out last year alongside Machina Research and suggests that:
- 24 percent of businesses’ IT budgets are now allocated to IoT;
- 76 percent of businesses say that IoT will be ‘critical’ for the future success of any organization in their sector;
- 48 percent of IoT adopters say they’re using IoT to support large-scale business transformation;
- 86 percent of businesses in the industrial sector — including companies in mining, construction and waste management — say they have seen “significant” return from implementing IoT.
But how useful are these figures?
Speaking to Internet of Business, Quocirca analyst Clive Longbottom questioned these figures and the conclusions that might be drawn from them.
“At this stage, this is a somewhat misleading and strange set of figures to put out,” Longbottom told IoB. “As a starting point, is a smartphone an IoT device or not? If it is, then Vodafone isn’t showing that many non-smartphone connections. If it isn’t, then how is it defining an IoT device?
“Also, is it counting non-Vodafone devices that just happen to touch their systems – for example, a Nest or Hive controller where the owner is controlling them while mobile through a Vodafone connection? Without a full definition of what Vodafone means by an IoT device, what it means by an IoT connection and whether it means that the IoT device has to be dedicated to being part of a Vodafone network, the statement it makes is meaningless.”
Longbottom also questioned aspects of Vodafone’s IoT Barometer findings.
“The generally accepted metric is that 60 to 80 percent of an IT budget is spent on keeping the lights on – power, cooling, patching, updates, other maintenance and so on. Yet somehow, Vodafone finds that organizations are assigning 24 percent of their complete IT budget to IoT.”
Vodafone has been contacted for comment and clarification. However, Tom Rebbeck, principal analyst at Analysys Mason, cast greater light on the findings telling IoB that “the number is quite clearly defined by Vodafone. I spoke to them about it this week and they’ve done a fair bit of work making sure the numbers were right.”
According to Rebbeck, the IoT connections include 50 million M2M SIMs, though this is not mentioned in the company statement.
“So SIMs that are on an M2M contract (e.g. Connected cars),” he said. “It won’t include smartphones or devices that don’t have a SIM.”
“I think the 50 million number is a very impressive achievement and reflects Vodafone’s strength in IoT. That said, it is only just beginning and with the developments in NB-IoT and LTE-M we should see continued strong growth in connections.”
Vodafone focus on NB-IoT
One area in which Vodafone has undoubtedly been an IoT pioneer is in its work on developing Narrowdband IoT (NB-IoT) networks alongside Chinese telecoms provider, Huawei.
NB-IoT is a LPWA technology that is claimed to offer low-cost, wide area coverage for objects requiring a long range mobile connection and low power consumption. It also promises up to ten years’ battery life and deep indoor penetration.
Together, Vodafone and Huawei completed the first over-the-air NB-IoT connection on a live network in Madrid, Spain, and the pair are now rolling that network out commercially across the country.
Vodafone was certainly one of the early investors in IoT technology and the company claims it has experienced double-digit annual growth in IoT revenue since first establishing a dedicated business unit focused on machine-to-machine (M2M) technologies in 2011.