In a previous article, I wrote about what the upcoming standard NB-IoT could change in the landscape of Internet of Things networks, especially Low Power Wide Area (LPWA) ones. While most mobile operators keep an eye on this technology and expect to use it to offer IoT connectivity services in the medium to long term, market conditions have pushed them to make a move sooner. In France for example, Sigfox started rolling out its Internet of Things network as soon as 2014. Bouygues Telecom –with its subsidiary Objenious– and Orange each decided to deploy their own LoRa networks in response.
The lack of reaction from SFR-Numericable, France’s second largest telco, could be perceived as a consequence of the still ongoing merging process between SFR and Numericable. Until recently the company indeed relied on mobile networks only to provide IoT connectivity. Altice (the telecom group behind SFR-Numericable), its subsidiary SFR and Sigfox however announced last week a strategic partnership regarding IoT solutions. The group will integrate Sigfox’ IoT connectivity in its offerings, in France as well as internationally.
The move can appear striking, as it is fundamentally different from the ones of Bouygues Telecom and Orange. Thanks to its mobile network, SFR already owns enough emission sites and masts to cover France, especially when considering the significant range of LPWA networks: why not take advantage of these assets to deploy its own network? The cost of base stations is actually much lower for IoT networks like LoRa than it is for mobile networks, especially 4G.
One could say that the tough cost cutting strategy of Altice could be accounted for the limited –or non-existant– strategic investment of the group. But the partnership with Sigfox could actually give SFR a significant advantage over its competitors. Sigfox has already announced a full coverage in France, and has started deploying in other countries. Following the partnership with the IoT operator, SFR can already offer international IoT connectivity solutions, while the competitors’ networks are still being rolled out. In particular, Sigfox already has a significant coverage in countries where Altice has activities, including Belgium, Luxembourg and Portugal.
If Altice decided not to deploy its own low power IoT connectivity solution, the group hasn’t given up potential IoT revenues: Altice implemented two platforms for the Internet of Things. The first one provides a web interface for the management of devices while the other one provides storage and analysis for the collected data (based on PTC’s ThingWorx solution).
The partnership with Sigfox shows a strategic refocusing on higher revenues segments of the IoT value chain. In the medium term, the operator also plans to develop LTE-M solutions for devices requiring more data throughput, as Sigfox’ solution has very limited bitrate (100 bps). The partnership between Altice and Sigfox may provide another reason for Bouygues Telecom and Orange to accelerate their deployments of LoRa networks. For Sigfox, SFR will most certainly be a major asset in their go-to-market strategy, in particular to target large customers, which may still perceive the IoT operator as a start-up.