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The Future of Connectivity in Iot Deployments Investing in Germany | a Guide for Chinese Businesses The Future of Connectivity in IoT Deployments Investing in Germany | A guide for Chinese businesses 02 The Future of Connectivity in IoT Deployments IoT & Connectivity 04 Market Overview 07 IoT Connectivity Use Cases 13 Long Term Implications 17 Business Implications 18 Summary 19 03 Investing in Germany | A guide for Chinese businesses IoT & Connectivity Like a wildfire racing across the dry prairie, the Internet of Things (IoT) is expanding rapidly and relentlessly. It sounds like an incredibly complex, but putting it in simple words, the Internet of Things (IoT) is nothing but a network that connects physical objects, such as vehicles, machine tools, street lights, wearables, wind turbines, people, and other devices, via connectivity solutions in order to enable communication, exchange data, and derive actions. With the underlying goal of having access things will be in use worldwide by the end to relevant information in real time (or at of 2017, up 31 percent from 2016, and least near real time), IoT sensors trans- that the number will reach 20.4 billion by form analog inputs into digital signals and 2020.1 Dell’s CEO estimates that as many thus create a digital reflection of what as 70 billion connected devices will exist is happening in the physical world. This by 2020.2 setup enables the development of intelli- gent applications and services and allows As IoT grows, so do the volumes of data objects to be sensed and actuated across produced by some estimates, connected existing network infrastructures. devices will generate 507.5 Zettabytes Developments in the IoT field happen at a (ZB) of data per year (42.3 ZB per month) breathtaking pace, and IoT is the source of by 2019, up from 134.5 ZB per year (11.2 many promising business opportunities, ZB per month) in 2014. (a Zettabyte is which are expected to result in yet unim- 1 trillion Gigabytes). Globally, the data aginable increases in efficiency, accuracy, created by IoT devices in 2019 will be 269 and economic benefits across organiza- times greater than the data being trans- tions, industries, and markets. Moreover, mitted to data centers from end-user IoT leads to new business models, moving devices and 49 times higher than total the focus from products to services. data center traffic.3 Currently, only 30% of the data created in areas like the supply The number of physical objects that are chain is leveraged for optimization, but it connected via the Internet of Things is expected that this number will increase increases at a tearing speed. Gartner, significantly in the future. Inc. estimates that 8.4 billion connected 1 Gartner | Press Release Feb 07, 2017 2 Marketplace.org | By 2020 there will be 10 web-connected devices per human 3 Deloitte | Tech Trends 2016 04 The Future of Connectivity in IoT Deployments Looking at this incredible increase in glob- It is worth mentioning that each connec- al data from IoT devices, several crucial tivity solution has its own strengths and questions should present themselves to weaknesses, and obviously, there really IT decision-makers: How can all this data, is no ‘one size fits all’ approach out there, generated by sensors attached to 'things', as all connectivity solutions are tailored be transferred efficiently into data-pro- to specific use cases and fields of applica- cessing applications and turned into smart tions. Rather, it is important to understand decisions? What connectivity solution is the variety of options available and the the cheapest/fastest/most reliable one? factors that influence the decision, such as Which connectivity solution should organi- network costs, required battery life, data zations choose in order to leverage IoT po- rates, latency, mobility, range, coverage, tential in their environment and what does and many other factors that need to be the selection process look like? What data balanced when it comes to the connec- do companies even transfer, and what can tivity selection process for a specific IoT be processed locally? How can decisions application within the company. In addi- be standardized for communication based tion, requirements for the underlying use on use case requirement mutualisation? cases of an IoT application are likely to change during its life cycle, as the vol- Due to the seemingly endless variety of umes or selection of data gathered from IoT applications available, organizations machines etc. might need to be adjusted struggle when it comes to an appropriate once patterns have been analyzed. selection process of the right connectiv- ity solution in their specific business use Taking a safari into the confusing jungle of case. Current connectivity solutions for connectivity solutions for IoT applications IoT extend from low-range connectivity in order to make informed decisions and solutions, such as Bluetooth, via familiar understand the current and future land- technology like cellular connectivity to scapes might eventually reward organiza- completely new concepts provided by tions with a cutting-edge advantage in the less-known or new providers and allianc- Internet of Things. es, such as LoRa or Sigfox. In this paper, Deloitte will present its point of view on the current market of technol- ogies, expected connectivity trends, and relevant IoT connectivity solutions for dif- ferent use cases, as well as the impact that Due to the seemingly endless different IoT connectivity solutions may have on a company’s IoT applications and variety of IoT applications available, business success. The paper will focus ex- clusively on common connectivity stand- ards rather than details of different proto- organizations struggle when it cols and systems. It is therefore the right information source for IT decision-makers comes to an appropriate selection who currently have little or no knowledge about IoT connectivity and are aiming to process of the right connectivity gain a broad overview in this area. solution in their specific business use case. 05 Investing in Germany | A guide for Chinese businesses 06 The Future of Connectivity in IoT Deployments Market Overview A wide variety of IoT connectivity standards Connectivity solutions for IoT can be struc- are already available in the market. tured into two high-level categories: wireless and wired connectivity solutions. From In general, standards vary in their technical these two main choices, wireless solutions specifications, which determine the specific can be further divided into long-range and IoT use cases that can be served by any par- short-range connectivity standards. Long ticular connectivity solution. Some of these ranges go up to 200km (HSPA), whereas specifications are: short-range solutions cover a maximum of approximately 100m (Bluetooth Low Ener- • Frequency gy). Long-range connectivity solutions can then be further subdivided into licensed • Max data throughput (data rates) (cellular) and unlicensed standards, known as LPWAN (Low Power Wide Area Networks). • Latency • Battery life in connectivity modules • Manufacturing costs of connectivity modules • Maximum data range • Coverage • Mobility • Security • Scalability (Mesh Network Availability etc.) • Robustness • Mobility The following part will provide a high-level overview of different connectivity solutions, potential fields of applications, and technical specifications. 07 Investing in Germany | A guide for Chinese businesses I. Wireless Solutions 1. Short-Range Solutions the differences in potential use case are Short-range IoT connectivity solutions substantial. A solution that comes with an transfer data over small physical distances, even lower range and bandwidth is called with the distance between the ’thing‘ that Z-Wave. Transferring data at a frequency collects data and the gateway that process- of 900 MHz, the connection is very energy es it (or sends it over the internet to anoth- efficient and gives a long battery life in the er platform) usually less than 150 meters. connectivity hardware. A frequently used example that is currently Typical fields of IoT applications for short- available is Bluetooth, which uses a fre- range connectivity solutions are wearables quency of 2.4GHz to achieve a maximum and smart waste management in smart city throughput of approximately 2 Mbps. ecosystems, as the distances between the Another well-known short-range solution 'things' and the next gateway are usually is Wi-Fi (at either 2.4 or 5 GHz), which has a very short. As an example, the city of Vien- maximum range of only about 50 meters, na, which received the “Best Smart Project but transfers data at much higher speeds 2016” award, uses Bluetooth in its smart of up to 600 Mbps, depending on the Wi-Fi parking concept.4, 5 standard. However, it should be mentioned that there are some security issues related The following table provides a more de- to the Wi-Fi standard. Comparing Bluetooth tailed overview of current short-range and Wi-Fi, it already becomes clear that connectivity solutions: even among short-range IoT solutions, Tab. 1 – Detailed overview of current short-range connectivity solutions Max. Max. Power Solution Frequency Range Throughput Latency Topology Consumption Use Wi-Fi HaLow Various Smart lighting, (IEEE (sub-1 GHz) 1 km 40 Mbps 100 ms Mesh Low smart HVAC, 802.11ah) security systems Bluetooth Mobile phones, 2.4 GHz 100 m 2 Mbps 6 ms Point-to-point Low Low Energy gaming, wearables Smart lighting, Z-Wave 800-900 MHz 100 m 100 kbps N/A Mesh Low thermostats, locks, sensors Lighting controls, Zigbee 2.4 GHz 100 m 250 kbps 10 ms Mesh Low
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