LTE and M2M: Converging Paths

LTE and M2M: Converging Paths

Introduction LTE is taking the wireless world by storm. According to the Global Mobile Suppliers Association (GSA), 49 operators worldwide had launched commercial LTE services as of January 2012, and 285 had committed to commercial network deployments or were engaged in trials or technology testing. In fact, LTE rollouts are now happening faster than expected. According to GSA, by the end of 2012, we can expect 119 commercial LTE networks operating in more than 50 countries. And, despite early questions about whether LTE deployments would be limited to high-density areas, LTE has become the de facto standard for the next generation of cellular networks. Alongside this unprecedented growth in LTE, however, the wireless world is seeing another major trend reshape the industry: machine-to-machine (M2M) communications. Just as LTE can unlock a new world of high-speed wireless applications, M2M promises to transform a wide range of industries by enabling remote communication with virtually any device from cars to coffee makers, oil pipelines to insulin pumps. Yet, while both market trends show no signs of slowing down, thus far they have proceeded along separate trajectories. Many in the industry can imagine tomorrow s connected devices, and can clearly perceive the benefits of lightning-fast LTE connections. But few seem to be talking about how the two fit together. In fact, there are many M2M applications that can benefit from LTE networks right now. But even for those M2M solutions that don t require LTE speeds and latency, there are good reasons to believe that LTE will play an important role in the future of M2M services. This paper explores the market forces driving original equipment manufacturers (OEMs) and other M2M stakeholders to consider LTE for connected devices and applications. It also discusses some of the barriers preventing lower-speed M2M applications from taking advantage of LTE, and what Sierra Wireless and others are doing to help evolve LTE technology for a broader range of M2M solutions. Market Drivers for LTE in M2M When examining LTE services in M2M, it is important to make a distinction between two classes of M2M applications: those for which LTE s high speed and low latency will provide immediate benefits, and those with less demanding connectivity requirements. 2

High-Performance M2M Applications In the first category, there are a variety of M2M applications, especially video applications, that can immediately benefit from LTE data rates up to 100 times faster than 2G technology. Examples include connected devices performing surveillance or transmitting video content. Devices may also combine video services with another form of computing for example, a digital sign display that uses network-based facial recognition technology to identify the age and gender of the person viewing it, and target advertising appropriately. But the advantages of LTE go beyond fast speeds. LTE also supports 10 times lower latency (the time a packet of data takes to travel between a source and destination) than 2G and 3G technologies, which can have an even more significant impact than throughput on some applications. For M2M applications where responsiveness is critical for example, applications controlling sensitive equipment, industrial alarms and controls, traffic systems, medical devices, and voiceover-ip low LTE latency can enable connected applications that would not otherwise be possible. For all of these applications and others for which speed, responsiveness, and performance matter, LTE can provide a superior solution to previous-generation cellular technologies. As LTE network deployments continue to expand around the world, expect these types of M2M applications to grow as well. Four Reasons to Think about LTE for M2M Longevity: The lifecycle of older cellular networks is unpredictable, and the cost of upgrading deployed technologies can be exorbitant. LTE will support connected devices in the fi eld for many years to come. Potentially lower service costs: LTE is much more spectrum-effi cient than previous- generation technologies and less expensive to operate, likely lowering operational costs over the lifetime of the connected device. Scalability: Most LTE networks deployed today support IPv6, making them well suited to mass M2M deployments that older networks cannot support. Superior performance: For M2M applications that require higher speeds and better responsiveness, LTE is an ideal solution. Lower-Speed M2M Applications But what about the other category of M2M applications? Many of today s M2M devices simply do not require LTE performance. And, since the cost of building and purchasing first-generation LTE embedded modules remains higher than 2G and 3G cellular solutions, 3

those developing M2M applications may find it difficult to justify investing in LTE. In the long-term, however, there are good business reasons to be thinking about LTE, even when higher speeds are not required. These include: Longevity: One of the most important advantages of LTE is the technology s longevity an important asset for connected devices that will have long lifecycles. Automotive M2M devices may need to operate in the field for 10 years or more, and connected industrial equipment and infrastructure will likely have an even longer lifespan. While these applications may function well over 2G networks, the expected lifecycle of those networks varies greatly from region to region. Mobile network operators (MNOs) in some parts of the world are actively shifting away from 2G services. For example, several tier-1 MNOs around the world have either already decommissioned their 2G networks or discontinued any new product certifications on 2G networks. The factors driving these decisions regulatory changes, scarce spectrum, mobile broadband subscriber growth can be difficult to predict. OEMs developing M2M devices have to consider that, depending on the market, 2G services may not be available for the full expected lifecycle of the device. Increasingly, they will need to weigh the incremental upfront costs of using LTE modules with the costs of performing a major field replacement down the road. Potentially lower service costs: Another benefit of LTE is the potential for lower service costs in the future. As an IP-based technology, LTE allows MNOs to use a flat IP core network, as well as standardized, self-organizing network technology, making it much simpler and less expensive for them to deploy, operate, and expand the cellular network. LTE also offers MNOs a great deal of spectrum flexibility, with the ability to deploy LTE in many bands and combinations of bands and deploy next-generation services in virtually any part of the spectrum an MNO has available. Finally, LTE offers much more capacity per MHz than 2G networks, and studies have demonstrated that it provides twice that of HSPA+ 3G networks, even when using comparable antennas and spectrum allocations. All of these factors can lower capital costs, and operating costs, which lowers the cost per bit for MNOs, and ultimately translate to lower costs for customers. Scalability: LTE is also extremely scalable, as unlike 2G and 3G networks, it is being deployed today with support for IPv6 addressing. This is becoming crucially important 4

as the world s supply of available IP addresses rapidly dwindles. IPv6 exponentially expands the IP address space, making it possible to enable the ultimate M2M vision of an Internet of Things. The fact that LTE networks support IPv6 also makes them wellsuited to future mass M2M deployments that might be constrained by the limitations of older networks that rely on IPv4 addresses and network address translation (NAT). Overcoming Barriers to LTE Adoption in the M2M Marketplace High-performance connected devices are already reaping the benefits of these LTE innovations. For developers of lower-speed/lower performance M2M applications, however, there remain some barriers that the industry must overcome before LTE becomes the cellular technology of choice. These include: Varying coverage: LTE rollouts are proceeding quickly, and there is no doubt that LTE will be deployed in large-scale national and regional networks (and not just in highdensity areas) worldwide. But, as LTE is a new technology, the coverage today is still evolving and is not currently as ubiquitous as 2G and 3G networks. The dynamic state of the LTE market also means that LTE coverage can vary greatly from region to region. Device cost: Another area of concern of OEMs developing lower-speed M2M applications is cost. Since LTE is still new, and since the technology is more complex than 2G (requiring support for more frequency bands and band combinations, more complex receiver configurations, and more sophisticated antennas) today s LTE modules carry higher upfront costs than 2G technologies. Indeed, some OEMs building lower-speed M2M solutions may feel that, due to the higher-performance (and highercost) components used in LTE, the LTE standard itself is just not optimized for their applications as currently constructed. Some of these barriers will be overcome simply through the passage of time. For example, the cost of LTE modules and devices will go down in time, as is the case with all new technologies. Lack of LTE coverage in some areas will also be resolved as LTE deployments proceed around the globe. (Additionally, it should be noted that since many MNOs are 5

deploying LTE at lower frequency bands, such as 700 MHz, LTE networks may ultimately provide even better coverage than higher-frequency 3G services for indoor applications.) However, significant efforts are now under way by network operators, LTE technology providers, and standards-making bodies to make LTE more amenable to M2M applications of all varieties. Lowering Costs The inherent variation and spectrum flexibility of LTE mean that it will likely always be more complex than 2G systems. But, M2M technology providers are working to address these complexities to bring costs down for M2M deployments. For example, Sierra Wireless and others are using new tunable component technologies to allow modems and antennas to handle more and wider bands, and help address the wide variation seen in today s LTE deployments. Ideally, this technology could eliminate the need for multiple filters, and other components that add cost to the device. It is also important to recognize that the bill of materials is just one part of total cost of ownership (TCO) of an M2M solution. GSMA studies suggest that hardware costs actually make up only 5 to 15 percent of TCO, and that service and operational costs can add up to much more over the life of the device. Major LTE vendors are working to bring down TCO for M2M applications by making it less expensive to develop and operate them. For example, Sierra Wireless built its Open AT operating system from the ground up to simplify M2M application development by providing all of the essential wireless services, TCP/ IP connectivity, and hardware resources that M2M applications require, without requiring an extra processor. Open AT also draws on the Eclipse Project to provide an integrated development environment (IDE) with embedded M2M language tools, runtimes, application editors, and more that make it very easy to develop M2M applications for connected devices. New M2M management solutions, such as Sierra Wireless AirVantage Platform also provide comprehensive tools for developing M2M applications and managing devices, subscriptions, and underlying assets. Combined with intelligent LTE gateways, these types of solutions abstract M2M management from the cellular network technology, allowing OEMs and developers to create M2M applications once, and port them to 2G, 3G, and 4G networks without code changes. 6

Optimizing LTE for M2M Recognizing the importance of lower-speed M2M applications in the marketplace, and the functional limitations of the current LTE standard in supporting them, standardsmaking bodies are hard at work on enhancements to the LTE protocol. Development is now under way on support for a new class of low-cost LTE devices that: Operate at sub-1 Mbps maximum data rates, Make it possible to use only a small part (e.g., 1.5 MHz) of bandwidth on the front end a tiny fraction of the current minimum requirement of 20 MHz Use a half duplex and single receiver (instead of full duplex and receive diversity receivers for each band) Improving LTE Efficiency and Performance Enhancing LTE for M2M Mobile network operators, standards bodies, LTE technology providers, and others are working together to optimize the LTE standard for a broader range of M2M applications. Efforts include: Developing a new class of lowcost, low-speed LTE devices Reducing congestion caused by large-scale M2M deployments Minimizing the footprint of LTE devices accessing the network Use lower transmit power to reduce power Improving power effi ciency consumption and hardware costs with longer sleep cycles for latency-tolerant applications Sierra Wireless, along with many other LTE vendors, is working closely with standards groups to bring these LTE and confi gurable mobility management functions enhancements to the marketplace. Ultimately, these efforts will allow developers of lower-speed M2M applications to take advantage of a new class of LTE device that features fewer hardware components, less complexity, and a lower cost, without sacrificing coverage. (For more details, see 3GPP Specification TR 36.888, and the 3GPP Study Item Description RP-111112.) Stakeholders throughout the LTE ecosystem are also working with standard-making bodies to address the congestion issues that can affect cell sites of all kinds (2G and 3G as well as LTE) when large numbers of devices are trying to attach to the network simultaneously. This can be particularly important in industrial or energy M2M applications where large numbers of devices may be deployed in a small geographic area. For example, new standards work aims to identify low-priority M2M devices to delay 7

them from trying to reconnect if they fail the first time. Engineers are also developing a new LTE broadcasting scheme that would allow the network to prevent all low-priority devices from accessing the network during certain timeframes. Standards groups are also working with LTE technology developers to create standards to protect the network from congestion or failures from roaming connections. For example, standards groups are developing protection mechanisms that allow networks to allow home subscribers access the network, but block roamers. This would be important for assuring that, in collocated networks, a failure in one network wouldn t immediately lead to a huge spike in traffic (and potentially even a failure) in the other. In addition to this work, LTE vendors and standards groups are working to improve coverage and minimize the footprints of M2M devices accessing the cellular network. One area ripe with possibilities is the potential to trade speed for coverage. Currently, LTE is optimized to use its larger bandwidth to deliver faster data rates. But theoretically, for M2M applications that don t require higher speeds, some of that spectrum could be used to improve inbuilding penetration, improving coverage for in-building M2M systems. Note that, while all of these innovations could theoretically be applied to cellular networks of all kinds, they are most likely to appear in LTE networks, where MNOs are already investing in deploying new technology in the cell site. (For more details on some of these efforts, see the 3GPP work item System Improvements to Machine-Type Communications.) Enhancing M2M Power Efficiency Sierra Wireless is also working with others in the industry to improve the power efficiency of M2M devices. In a standard cellular module, power consumption is largely a result of receive functions. In human-to-human communication (in a cell phone, for example), it s important to design devices with very short sleep cycles, that are able to wake up and receive a connection in a very short time, typically less than a second or two. In many M2M applications, however, it is perfectly acceptable for a device to take several minutes to connect with the network after receiving a page. Standards bodies are now working to change the LTE standard to accommodate this reality, developing longer sleep cycle durations for latency-tolerant M2M applications. The LTE standard is also being adjusted to make the period for mobility management functions 8

configurable per device. This would mean, for example, that unlike a cell phone, a stationary piece of industrial equipment need not check in with the network every two hours minimum to report its location (and need not waste capacity and battery life performing that function). Conclusion Connected devices and applications promise to revolutionize the wireless industry, but today, solutions for low-speed M2M applications and high-performance M2M applications are evolving along two different paths. Those that can immediately benefit from high speeds and performance are rapidly embracing LTE, while those developing lower-speed applications have largely remained with previous-generation cellular modules. However, these M2M evolution paths will soon converge. Ultimately, the advantages of LTE most notably its longevity, scale, and operational efficiency are simply too great for OEMs and other M2M stakeholders to ignore. Sierra Wireless, along with other leading LTE technology vendors and standards groups, is working to optimize LTE for M2M. This work encompasses a broad range of efforts to improve LTE efficiency for OEMs that require high performance and low latency in their M2M applications, and to lower LTE costs and complexity for those that do not. Sierra Wireless is also drawing on its extensive expertise in multi-mode/multi-frequency solutions to develop the most effective LTE modules and devices. As a global pioneer in firstgeneration LTE technologies and the market leader in M2M, Sierra Wireless has cultivated mature and extensive LTE testing protocols, advanced antenna design capabilities, and in-depth knowledge of MNO networks and certification processes worldwide. As a result, Sierra Wireless is well positioned to help OEMs and M2M application developers avoid the many potential pitfalls inherent in LTE, and streamline the development and approval of their LTE-connected devices. Both the M2M marketplace and LTE technology will continue to evolve. Sierra Wireless is investing resources to assure it will continue to be the global leader in both industry revolutions. 9