On this episode of the Six Five Webcast – The 5G Factor, we dive deep into why companies like Qualcomm, Ericsson, and AT&T are making significant moves to advance and scale the Internet of Things (IoT) across the 5G ecosystem. Hosts Ron Westfall and Tom Hollingsworth share their expert analysis on the competitive landscape implications of recent developments within the sector.
Their discussion covers:
- Qualcomm’s Investor Day revelations about their new IoT strategy, focusing on creating scalable blueprints to foster industry-wide solutions.
- Ericsson’s emphasis on private 5G networks to address the unique needs of the Oil and Gas industry, highlighting the shortcomings of Wi-Fi in IoT connectivity.
- AT&T’s decision to decommission its narrowband Internet of Things (NB-IoT) network by 2025 and its implications for alternative technologies like 5G Redcap, LTE-M, and LoRa.
- The competitive dynamics Verizon and T-Mobile are creating with their continued investment in NB-IoT offerings.
- Potential future trends in the 5G and IoT landscape, reflecting on the moves made by Qualcomm, Ericsson, and AT&T.
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Disclaimer: Six Five Webcast – The 5G Factor is for information and entertainment purposes only. Please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors.
Transcript:
Ron Westfall: Hello, and welcome everyone to The 5G Factor. I’m Ron Westfall, Research Director here at The Futurum Group. I’m joined here today by my distinguished colleague, Tom Hollingsworth, the Networking Nerd and Event Lead at Tech Field Day here at The Futurum Group. In fact, I believe we’re coming off a very successful event. That is Mobility Field Day 12, where I believe we had very stimulating presentations and conversations with Cisco and Nile, and we’ll touch on that a bit more in our conversation today. But first, hello, Tom. Thanks again for joining The 5G Factor today.
Tom Hollingsworth: Well, thanks for the invitation, Ron. I’m rested up after having a great Mobility event. I’m looking forward to having a little bit of turkey before we close out the year.
Ron Westfall: Naturally. I think we all are. That doesn’t mean we’re resting still overall. After all, there are more Tech Field Day events on the horizon, specifically in 2025. Today, I’ll touch on one. That’s Mobility Field Day 13. It’s already scheduled for May 7th, 8th of 2025. We already have folks signing up for it. So hey, now would be a good time to think about it, and start signing up before it’s filled out. Tom, anything to add for the upcoming Mobility Field Day 13 event, as well as Tech Field Day in general?
Tom Hollingsworth: Well, Tech Field Day is going to be a very popular event in 2025. We’re already getting a lot of interest from a lot of different companies. If this is something that is on your radar, you definitely need to reach out to us, because I don’t want you to be the last one holding the bag when we fill up the event and we have to wait for the next one.
Ron Westfall: That’s right. Yeah. May is the first one. But if you miss the May one, you might have to wait until, I don’t know, the second-half of the year for sure. But with that, let’s dive into our conversations today, on The 5G Factor. One thing I think it’s important to touch on is what’s going on in the IoT realm, because it’s been a lot of conversations here over the last month plus. And specifically Qualcomm is focusing on building its IoT portfolio and presence to usher in what is being characterized as the industrial intelligence era. I think that’s a pretty smart way of describing what is on tap here. Combining the capabilities of connectivity with the new, evolving capabilities that technology such as AI can introduce into how organizations use edge connectivity to their competitive advantage.
What we’re exploring is really organizations are looking more and more to adding intelligence to, again, their edge. Whether it’s tracking products in the warehouse, or optimizing surveillance cameras in a secured energy facility, whatever it is, what they have in common is that they face challenges ranging for non-uniform deployments to unreliable connectivity. That’s something nobody really wants. As a result, Qualcomm, led by Nakul Duggal, who’s now their group GM not just for embedded IoT, but also automotive and cloud computing. He is leading the charge, and he’s spotlighted Qualcomm’s ongoing IoT push at Qualcomm Investor Day, following on what I think was a very effective debut at Embedded World North America in Austin, about a month ago.
What’s going on here? Qualcomm Technologies hopes to solve these challenges by bringing a more strategic and unified approach to its hardware portfolio, alongside customized solutions tailored to the specific needs of each industry. Yes, this is not unique to IoT. We’ve seen this before. You want a portfolio that, on the one hand, is unified. It can bring cohesion to the fragmentation and silos out there. But also, it has to strike that fine balance in being able to meet and attune to the specific needs of the customer. Really, attaining the best of both worlds. Can Qualcomm do this? Well, we’re looking at it, in terms of starting with two fundamental aspects. First of all, the edge can be intelligent and the edge is connected. As a result, industrial intelligence, the term I already touched on. From there, solutions, from Qualcomm’s perspective, and also from mine, can be mixed and matched more to address everything from the energy sector, retail, healthcare, enterprises, you name it. We can basically span the entire list of major verticals out there.
What Qualcomm’s strategy is doing, it’s involving scalable blueprints, or chassis as they’re making that comparison to the automotive realm where they’ve had a great deal of success. That is blueprints for every vertical that looks for similarities across industries for different solutions. And then, creating bespoke solutions as they are needed. At its core, Qualcomm components, including specialized enterprise-class processors, such as the Qualcomm IQ Series, they are using AI capabilities alongside 5G and other wireless connections to meet challenges such as extreme environments. It includes, among other things, hardware stacks, software stacks, edge AI infrastructure, services and deployment solutions, as well as all-important location and observability services. Tom, with that kick-off, what do you see of Qualcomm’s prospects? What do you see going on here? Why Qualcomm is putting so much more effort into addressing the IoT realm?
Tom Hollingsworth: Because Qualcomm realizes that there is a finite horizon for user-facing devices. We all have them. I have a phone, and I have a laptop, and I have a tablet. Do I need two? Do I need four? Eventually, you get to a point where you realize there’s only so many things I can have in my hands. Whereas with IoT devices, we know that those get deployed by the dozen when we’re using them as sensors, when we’re using them as data collection points, when we’re using them in a variety of industrial applications. Think about something as simple as an access point. You don’t buy those one or two a time, you buy them one or two cases at a time. Qualcomm realizes that there’s a lot of value in providing the chip sets that go into those things. They’ve been doing a lot of research into providing specifically low-powered full-featured chip sets.
Look at the Windows, the Recall PC. That’s powered by a Qualcomm SnapDragon processor. Okay. The main CPU, the laptop is doing the work. But the SnapDragon is sitting over there on the side, basically accelerating the AI functions on it. If you have something that capable in a small-set form factor where I need to deploy this not in a desk where there’s power, and proper air handling, and things like that. But I need a small box that’s maybe two or three inches square stuck on the side of a piece of milling machinery. If I can collect data, and provide information, and control to that device with something that is consistent, repeatable, that I can count on it, then I’m going to buy those and put them everywhere. Because we’ve been told for years that we’ve got to start being able to do more with less staffing. I think that companies like Qualcomm have realized that the future is IoT. There are going to be billions of IoT devices that are going to be deployed in just the next couple of years. Being able to have a foothold in that market is a huge competitive advantage for any company that can work with the challenges that exist there.
Ron Westfall: Yeah, I agree, Tom. I think the market is really coming to that threshold where it’s going to take off all the more. Qualcomm already has a presence here. It’s like, “Okay, let’s really expand our presence.” In addition to providing chip sets that are optimized for IoT applications, it’s also raising the channel profile, working with systems integrators, resellers, developers, tapping into resources that Qualcomm can bring to the table in that area as well. Such as the Qualcomm AI Hub, and the Qualcomm IoT Solutions Framework. And also, in Qualcomm’s case, even working more directly with large enterprises, in terms of how can we get these solutions customized to meet those specific needs. Taken together, I think Qualcomm can attain that Goldilocks, if you will. Of being able to have a platform that is built to overcome existing barriers out there, but also, at the same time, meet the specific needs of each customer.
And as a result, basically enable industrial intelligence to become really a widespread global phenomena, to make IoT scaling all the more secure and, well, rapid. I think this is encouraging, that Qualcomm is indeed throwing its hat into the ring, in terms of this specific initiative. I think it’s tying into, and you touched on it, is how is the connectivity going to be optimized for enterprises in these high demand verticals? Certainly, when it comes to wireless connectivity. In addition, Ericsson is promoting prime 5G or cellular connectivity, specifically for the oil and gas vertical or the energy vertical. From my view, private cellular networks can provide advantageous coverage, higher throughput, lower latency, you name it, for the oil and gas applications specifically. Why is that, what am I comparing it to?
Well, specifically, wifi comes to mind. But hold on, there’s more here than just, “Okay, is private 5G automatically better than wifi for addressing evolving oil and gas needs?” I think what we’re seeing is that they need to basically understand the better the business value of these use cases, that is the connectivity providers. And how can private 5G adoption be driven amongst the operations teams within this vertical? To address this challenge, Ericsson developed its ROI Calculator. Now, of course these calculators can be disagreed with, but it does at least provide a way to better understand, “Okay what is it in my environment that I need to know about and consider, in terms of how can I make my connectivities all the more business friendly?” That is, improve business outcomes. That is really the ultimate line. Really, are ROI Calculator that Ericsson is unfolding focuses on three major use case areas, as well as other ones.
But it’s really looking at what’s the reality on the ground today in oil and gas, and that is the connected worker. He touched on that, Tom. The field workers that are equipped. The smartphones, the tablets, the video-connected helmets, et cetera. Including what’s increasingly AR capabilities, for being able to look at construction designs and so forth, on a flexible basis. As well as, of course, IoT connectivity. Here’s the one I find intriguing, as to how private 5G can have an edge, and that is robotics and drone capabilities, using them for whatever is required. Inspections specifically, when it comes to energy and oil, comes to mind. That is increasingly using drones to do things like leak detection, integrity checks, you name it. It’s just they’re well-suited for that, versus sending a person out there in a challenging environment to do those things. Quite simply, I think you need private 5G connectivity to really make that work on an optimal basis.
Now, Ericsson sees wifi networks, in this environment at least, as facing limitations in terms of scalability, reliability, and security, let alone coverage. As a result, they’re tipping the balance in private 5G’s favor. But we saw at Mobility Field Day 12, vendors like Cisco are saying, “Now, hold on. Maybe you don’t need a private 5G implementation.” Because from a wifi vendor’s perspective, or at least one who is touting wifi specifically for these situations, is that you can use ultra-reliable wireless backhaul integrated into, say a new Wi-Fi 7 access point, to achieve the same capabilities. I don’t know. Can they peacefully co-exist more, or is there really a more head-to-head competition going on? Tom, from your perspective, what do you see going on here? At least when it comes to oil and gas, let alone other verticals that have similar demands. What is the competitive mix, and how do you see it playing out?
Tom Hollingsworth: Well, oil and gas has always been a really weird industry to be involved in because so much of it takes place in places that are, well, for lack of a better term, hostile to IT environments. If you’ve never been on a drilling rig before, it is the dirtiest, dustiest, most dangerous place that you could ever deploy an access point, or a sensor, or something like that. I get the need to be able to have the IoT devices, drones, robot inspectors, you’ve got to think there are hundreds if not thousands of miles of pipeline out there. Having a person driving it, looking for damage, is just not feasible. But if you could have some kind of a drone system that can just constantly watch it, or have these things plugged in, that’s great.
The problem, of course, is that those thousands of miles of pipeline don’t run next to your average Starbucks wifi hotspot. They run through the middle of nowhere. What are your options? Well, if you have cellular connectivity in that area, I guess you could use a private 5G LTE type deployment. But you can’t even count on that sometimes. What companies like Cisco, and others who are in this ultra-reliable backhaul area are thinking is, “What if you just create this mesh network?” I see the value in that. If you can backhaul those signals down that pipeline as needed, that’s super valuable to people. Now, you got to think about it this way, though. When you look at whose proposing which solutions, they’re playing to their strengths.
The Ericssons of the world, the Solanas of the world, they’re going to tell you that private 5G is the best solution. It’s because that’s what they sell. That is their primary way of getting the technology out there. If you talk to the Junipers of the world, the Ciscos of the world, the HPEs of the world, they’re going to have a different story, because they have historically been very all in on the wifi side of things. I mentioned HPE as a company that does this. HPE actually has a foot in both realms. Because they have the pedigree of the HPE Aruba Networking access point portfolio, but they also have the Athena acquisition that they made last year, that has private 5G capabilities. I think a lot of companies, they’re working on one solution. I think some of them are going to pivot. It’ll be interesting to see if they come up with dedicated use cases that work better for one case over the other. Or if they says, “You know what, this is the one that we do that works the best, and that’s what we’re going to go with.”
Ron Westfall: Yeah. I agree wholeheartedly, in terms of the competitive mix. It’s going to be really correlated to, on the one hand, what the customers’ needs are. Oil and gas does have some rather distinct challenges that don’t really apply to, say manufacturing, let alone other transportation applications, where ultra-reliable wireless backhaul, or URWB, could be well-suited. I think you have an excellent point there, in terms of what HPE is doing with its portfolio. Yes, they acquired Athena, and yes, they have the Aruba assets so they can bring both to the table. They have positioned, at least HPE Aruba Networking Central, to be able to provide visibility and administrative oversight for both implementations when they need to coexist. I think that will increasingly be the case, where wifi is used for what can be characterized as carpeted areas, or even in some scenarios outdoor if using URWB and it just so happens to work as it’s advertised to work.
But ultimately, still could require private 5G for fleets, and remote drones, and thinks like that, where the connectivity options are just more expanded because of coverage and things of that nature. Yes, the players out there are going to I think increasingly take this approach, because Cisco also has a private 5G side of the house. There will probably be more coordination as this market evolves because, while private 5G has been victimized somewhat by the hype cycle, it is actually making more inroads. The technology has matured. Lessons have been learned, solutions have been simplified to overcome some of the complexities. And also, okay, is there a little extra capex up front sometimes? Yes, that can be the case, but the benefits can pay off because of these ROI calculators that folks like Ericsson are offering.
Stay tuned. It is going to be exciting. This is actually I think a very exciting space to watch, in terms of how this will play out. Because wireless connectivity, no matter how it’s deployed, and no matter how it’s implemented, it’s going to become just that integral. That’s why Qualcomm’s betting so heavily on it. In terms of edge intelligence and AI being a key reason why that’s becoming so strategic for a lot of organizations out there. Speaking of IoT, well, we had an interesting announcement come out. That is AT&T said it will start decommissioning its narrowband IoT network next year, in ’25. However, Verizon and T-Mobile reaffirmed that they are going to continue supporting their NBIoT offerings. What is going on here? Why would AT&T do this? Well, first of all, it just hasn’t gained much traction, at least from AT&T’s perspective. As we know, NBIoT is really predominate in terms of the global market in China. I believe up to 90% of all narrowband IoT deployments are in China.
However, that does not deny that it still can be very applicable to markets here, right here in the US, and other parts of the world. It also brought to attention why would you stop NBIoT? What can you then run with? Well, you have LoRa, you have LTM, you have 5G Redcap. There’s just really an interesting plethora of options out there if you want to replace NBIoT, like in AT&T’s case. As a result, all of them, if you look at AT&T specifically, but also T-Mobile and Verizon, are going with LTEM. Part of it is the fact that it can accommodate more deployment flexibility. It can share spectrum with other applications, and so forth. And also, what’s interesting about Redcap as its coming on board, specifically in alignment with the 5G Advanced Standard, it’s actually designed specifically or IoT environments that are being supported by 5G networks. And as such, that’s why we’ve seen T-Mobile already announce Redcap services. Verizon will be following suit. As a result, it’s interesting what’s going on here in the IoT space. I’m not going to pile on Cisco announced also an interesting IoT move. Tom, what do you see going on here? Why is the IoT space suddenly so kinetic? What to do with all these options? What do you see winning out?
Tom Hollingsworth: Well, if you give me just a second, I can give you a presentation on this laser disc that I own. And if anybody got a chuckle out of that. For you kids that might be listening to this, laser disc was a format years ago. I’m kidding. The reason why AT&T is dumping narrowband is because it’s very narrow. Yes, it is a huge market in China, but we are not China. That is a problem for AT&T. Because just like the last format war, HDDVD versus Blu-ray, you’ve got proponents on both sides. This is going to be the next big standard, we’re going to make this the big deal. We’re going to give away the players, and we’re going to put the best movies on it. Eventually, there is a winner. Both of them will not really coexist.
Yeah. Maybe what you’ll run into is that weird thing where you have narrowband is still big in China and that’s the only thing, but the rest of the world ends of going with LoRaWAN, or what have you. It’s no different than the television sets, NTSC versus PAL. Europe still uses PAL, US and Japan still uses NTSC. But I think that AT&T’s seeing the writing on the wall here. They, I think, believe … Maybe that what they were hoping was that if they supported NBIoT that they could break into the Chinese market. I think they’re seeing that that’s probably not going to be the case. Why would you try to bang your head against the wall to develop these deployments, when you could sign onto one that seems to be popular like LoRa, or even Redcap?
And say, “Well, this is what we’re going to go with in the future because it seems to be that there’s already more traction for those here.” For Verizon and T-Mobile, maybe their customers are not really deploying it right now, so they think that they have an in to get there. But I think more likely than not, what we’re probably going to see in a few years is that they will slowly deprecate support for the protocol, especially if one of the others becomes ascendant here in North America and in Europe. I guess time will tell would be the best way to put it. But I also know that a market that moves this fast, time will tell is basically like saying I don’t know what’s going to happen.
Ron Westfall: Fair enough. Yeah. It’s an interesting mix. I think part of it is that T-Mobile and Verizon, “It’s not broken so we’re not fixing it.” AT&T is like, “Well, broke enough. We’re just not making money off of it, so we’re going to cut loose at the front end.” At least, the ones of the major three of the US carriers in the US. Yeah, stay tuned. Already, T-Mobile and Verizon are on board for LTAM and 5G Redcap. I think there’s some writing on the wall. That’s a fair point about China. It’s a rather unique market. Part of the reason why narrowband has had so much traction, well, it was heavily subsidized. It just made it all the easier for the carriers in China to deploy it, and other organizations. It was just that, very cheap to adopt. As a result, it’s widely embedded. However, China itself will be evolving its IoT implementations. Speaking of LoRa, which is still certainly alive and kicking, it’s ecosystem and so forth. But we saw Cisco announce that it was going to discontinue it’s LoRaWAN support. I guess, Tom, any insight on why Cisco made this move, what’s going on with the LoRa community?
Tom Hollingsworth: I would almost be willing to be it has a lot to do with the announcement of their support for the ultra-reliable wireless backhaul. They’re doing the exact same thing that AT&T is doing. They’re looking at the support for standards and saying, “Well, do we need to have an option for every one of these?” Some people might say, “Well, why don’t you?” Then I would remind them that Cisco doesn’t make a token ring switch anymore. Just because there has been a standard around for years doesn’t mean that you can’t decide to standardize on something else. Could they? Yeah, they could. But here’s the thing. If the leader in a market, or a large player in the market, decides to drop support for a protocol, and then other groups follow suit, does that mean that you’re going to end up support for it across the board? I don’t really have a good answer for that.
I will tell you though, that we did record a podcast on the Tech Field Day Podcast, about how wifi isn’t always the perfect solution for what you need. There’s other things, like 5G Redcap, LoRaWAN, Wi-Fi Halo, you name it. There’s a lot of people out there that are huge proponents for those non-wifi protocols. They’re still wireless, but they’re not wifi. I think it’s always going to be that chicken and the egg problem. Is the protocol going to gain support because it’s backed by big vendors, or are big vendors going to back it because there’s wide support for the protocol? If I was a vendor, I don’t know how to bet on that. But I think that Cisco’s probably trying to focus on areas where they feel like they can have a material impact in the way that the standard is developed, which gives them a little bit more input into how it will be implemented to help them sell more hardware.
Ron Westfall: Yeah. No, I think that ties it together. Yes, I think that’s very helpful, in terms of the why behind this decision making. Yes, we will definitely be following what’s going on in the IoT realm, and how it relates to 5G ecosystem. Clearly, their destinies are intertwined. It’s been projected to have that for a while, but now it’s becoming increasingly clear. But, hold on. There’s plenty of ways to support IoT without necessarily involving 5G beyond coexistence. This is going to make an exciting market. Maybe the competitive mix will be like streaming services. It’ll just be multiple choices, and each customer will decide what bundles and combinations they need and want.
There you go, the provider will supply that capability. That’s not to say that somebody like Cisco can’t help make a difference, when it comes to specific protocols, and so forth. Yeah. That will just add to, I would say, the intrigue as the competitive terrain evolves rapidly as we step into 2025. With that, I would like to, again, thank everyone for jumping on and listening to our perspective as to what’s going on in the 5G ecosystem. Or really, the 5G IoT ecosystem for today’s conversation. Tom, thanks again for hopping on before the Thanksgiving holiday kicks in. I think we’re all looking forward to that.
Tom Hollingsworth: I’m always happy to be a part of this, Ron. It’s interesting to see where people are taking wireless technology, and what is being adopted. It’s not just wifi. It is 5G, it is LoRaWAN, it is ultra-reliable wireless backhaul. You name it, there’s a lot of technologies out there to investigate. The more time we spend talking about it, the more informed decisions you people out there can make.
Ron Westfall: Yeah. That can make mobility fields all the more important for how is this breaking out, how is this evolving. That will be a great snapshot about six months from now, to better understand how this is indeed evolving, and how it is really prevailing in terms of the competitive landscape. Again, everyone, don’t forget to bookmark. It’s 5G Factor on The Futurum Group website, as well as we’re on Techstrong TV. And we’re certainly also on Tech Field Day, in terms of talking about these key topics. With that, everyone have a happy 5G and IoT day.
Author Information
Ron is an experienced, customer-focused research expert and analyst, with over 20 years of experience in the digital and IT transformation markets, working with businesses to drive consistent revenue and sales growth.
He is a recognized authority at tracking the evolution of and identifying the key disruptive trends within the service enablement ecosystem, including a wide range of topics across software and services, infrastructure, 5G communications, Internet of Things (IoT), Artificial Intelligence (AI), analytics, security, cloud computing, revenue management, and regulatory issues.
Prior to his work with The Futurum Group, Ron worked with GlobalData Technology creating syndicated and custom research across a wide variety of technical fields. His work with Current Analysis focused on the broadband and service provider infrastructure markets.
Ron holds a Master of Arts in Public Policy from University of Nevada — Las Vegas and a Bachelor of Arts in political science/government from William and Mary.
