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Netmanais Korean ICT Research Report
SK Telecom's Massive IoT Deployment through LoRa for Small Things Price: |
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■ Executive Summary
Since its LTE service launch in 2011, SK Telecom has posted higher ARPU and revenues thanks to an increase in LTE subscriptions, which has a higher ARPU than 2G/3G. However, recent years have seen a stagnation in mobile subscription growth, and LTE subscribers who were once responsible for high ARPU are now switching to more affordable phones and plans. This has slowed mobile ARPU growth, consequently affecting the company’s revenue. The operator, with most of its profits coming from the sale of mobile phones and service plans (connection fees), is now in desperate need of new services and business models that can reverse the downward trend of the heavily smartphone-dependent mobile industry.
In light of this demand, SK Telecom concludes that the Internet of Things (IoT) can serve as the next growth engine to overcome declining sales in the LTE division.
SK Telecom foresees a tremendous number of “small things” dominating the market in the near future, creating new business values through small/tiny-volume data they constantly generate. The Internet of Small Things (IoST) is predicted to have high marketability and fast market formation. For these reasons, the operator has decided to dedicate its resources to IoST.
SK Telecom is currently prioritizing efforts on three key IoST service areas: metering, tracking, and monitoring & control, and planning to launch corresponding services in B2B/B2G and B2C markets in the second half of the year.
In the B2B/B2G market, the second half of the year will see the commercialization of 20 services which will include seven key services/solutions: Utility AMI, manufacturing facility safety management, environment monitoring, construction site safety management, public lighting facility management, location tracking, and mortgaged asset management. For B2C, tracking solutions (for persons/properties/pets) will be the first to hit the market in Q3 this year.
To this end, the operator has completed the deployment of a nationwide LoRa-based, IoST-dedicated network in the end of June, finishing the task in just three months. In an effort to promote the formation of an SK Telecom-centered IoST ecosystem, it has also shared an IoST roadmap and some partnership models of the IoST module, device and platform for potential partners.
This report will discuss how well SK Telecom is poised for the emerging IoST sector, and where it is heading. |
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■ Table of Contents Summary---------------------------------------------------------------------------------------------------------------- 2 1 Key Findings------------------------------------------------------------------------------------------------------ 5 2 SK Telecom faces concerns about market stagnation and downward growth-------------- 6 3 SK Telecom's transition to small things------------------------------------------------------------------ 7 3.1 SK Telecom’s target IoT market: IoST---------------------------------------------------------------- 7 3.2 Multi-track IoT network---------------------------------------------------------------------------------- 9 3.3 Why LoRa?----------------------------------------------------------------------------------------------- 10 3.4 LoRa network roll-out----------------------------------------------------------------------------------- 13 3.5 LoRa network architecture----------------------------------------------------------------------------- 15 4 SK Telecom's LoRa-based service: Present and Future------------------------------------------ 18 4.1 Key areas of LoRa-based service------------------------------------------------------------------ 18 4.2 B2B/B2G services: Metering, tracking and monitoring & control----------------------------- 18 4.2.1 B2B/B2G target services/solutions and potential markets---------------------------- 18 4.2.2 BM------------------------------------------------------------------------------------------------- 20 4.2.3 B2B/B2G service roadmap------------------------------------------------------------------- 22 4.3 B2C services: Tracking-------------------------------------------------------------------------------- 22 4.3.1 Services and target markets----------------------------------------------------------------- 23 4.3.2 BM and service plans-------------------------------------------------------------------------- 24 4.3.3 B2C service roadmap-------------------------------------------------------------------------- 24 5 SK Telecom's Strategies for Building a thriving LoRa ecosystem----------------------------- 25 5.1 Strategies for LoRa module--------------------------------------------------------------------------- 25 5.2 Strategies to boost the demands for IoT platform------------------------------------------------ 27 5.3 LoRa price plans (monthly connection fee)-------------------------------------------------------- 30 6 Closing------------------------------------------------------------------------------------------------------------ 32 Appendix--------------------------------------------------------------------------------------------------------------- 33 A. IoST strategies by other operators in Korea----------------------------------------------------------- 33 Abbreviations--------------------------------------------------------------------------------------------------------- 34 |
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■ Table of Figures
Figure 1‑1 SK Telecom’s concern: Market stagnation and downward growth........................................ 6 Figure 2‑1 Three IoT areas categorized by connectivity requirements.................................................. 8 Figure 2‑2 Multi-track IoT network of SK Telecom................................................................................. 9 Figure 2‑3 SK Telecom's view on LoRa................................................................................................ 12 Figure 2‑4 IoST network roll-out (LTE-M and LoRa)............................................................................ 13 Figure 2‑5 Installation of LoRa base station next to LTE base station (RRH) at current cell site ......... 14 Figure 2‑6 LoRa network architecture of SK Telecom.......................................................................... 15 Figure 3‑1 B2B/B2G target services and potential market size............................................................ 19 Figure 3‑2 System integration model (utility AMI)................................................................................. 20 Figure 3‑3 Platform business model..................................................................................................... 21 Figure 3‑4 Roadmap of B2B/B2G target services................................................................................ 22 Figure 3‑5 B2C tracking services: Potential markets and customers................................................... 23 Figure 3‑6 B2C service roadmap......................................................................................................... 24 Figure 4‑1 Sourcing and managing of LoRa chip and module............................................................. 26 Figure 4‑2 SK Telecom's IoT platform policy: Use it or interwork with it............................................... 29 Figure 4‑3 SK Telecom's IoT platform policy: Data and revenue share............................................... 30 |
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■ List of Tables
Table 2-1 SK Telecom’s Multi-track IoT networks Table 2-2 Benefits of LoRa Table 2-3 SK Telecom's LoRa network components and deployed solutions Table 3-1 Plans for LoRa-based B2C tracking service Table 4-2 LoRa module types and typical business models by SK Telecom Table 4-2 LoRa price plans |
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It's a little expensive.
the next wave approaching..faster than predicted. Nearly reach its maturity peak. Tightly following the cloud's wave
Thank you for posting an interesting article about IoST.
And also, I heard about KT's $130m investment to IoST.
So, if it is possible, could you tell me what is your strength in IosT market compared with KT's platform?
This article shows LoRa is not alternative but compatible technology to LTE&other GSM based IoT communication solutions.
Thank you for posting very interesting article.
It is too expensive!!
Thanks for sharing for FREE !!!
In fact, the price of NB-IoT is expected to be pretty low, but the ecosystem will not be fully nurtured until the first half of next year, at the earliest. In our IoT business, our #1 priority is to dominate the market, and so we just cannot wait. That’s why we chose LoRa over NB-IoT, at least for now.”
Unfortunately, it is not happening now in the 1st half of 2017 for NB-IoT.
"LoRa-based", but not LoRaWAN...
This is a good news...
Thanks
thank you very much for great information and research!
"the operator has decided to dedicate its resources to IoST" ------I like to understand from point of view core network ( PGW/SPGW) AND FROM point of view charging system what it is the impact and the pre-request ( supported inter-communication , releases , performance , new configuration ...) Thanks in advance ...