Monthly Archives: November 2016

Segmenting the IoT Market, autonomous versus powered

Consumer versus business IoT deployments

In a previous blog, we looked at the one of the issues of using off the shelf modules for IoT endpoints. The linked commercial question is what is the volume and value of the opportunities for autonomous (battery) versus powered IoT endpoints?


Given that there are going to be over 1 billion new mobile phones coming to market every year and that the majority of these will support BT smart (BT LE etc.), it is a reasonable bet that there will be a healthy market for autonomous IoT devices that are capable of interacting with these phones. The autonomous endpoints are battery powered and using the lowest energy connectivity possible. This is the IoT mobile driven market assumption.

What wisdom exists on the internet?

There are a wealth of IoT market papers and surveys out on the web and I am going to sample a couple of them, to try and make sense of the question above. Good source for different studies and forecasts:

Whilst acknowledging there are discrepancies between them, what do these reports tell us?

  • The volume of connected devices will be about 20-30 Billion by the end of 2020 which is a growth rate of 20-25%.
  • Most of the “value” created, with varying definitions of economic value add, will be in the business sector (2/3) as opposed to the consumer sector (1/3).
  • However, most of the end-point deployments (2/3) are in the consumer segment i.e. 13.3-20Bn and the rest in business, 6.7-10Bn.
  • The investment in device/software/integration will be a small chunk of the overall economic value created (~10%).
  • Only 10% of devices will be connected over cellular, 90% non-cellular
  • Average cost for a consumer endpoint is $100 and this is flat to 2020; By contrast the business average is $400 falling to $250-300 by 2020.
    • Likely to be considerable variation as some end points are already <£10
  • Opinions differ on the share of the device vs. system cost and reflect perhaps different expectations in business environments compared to consumer and scenarios where different systems are becoming interconnected.

Guesswork.. and plenty of assumptions

If we are interested in device based business cases then the volume is in the consumer segment. Within *consumer there can be home, personal transport and personal technology.

  • Home: home hub, lighting, remote thermostats, remote controls, radiator valves, RC sockets, fire/smoke detectors, movement detectors, video surveillance, energy usage monitoring, humidity sensors, smart bed etc.
  • Transport: car/motorbike charge point, bicycle light charging
  • Personal technology: PC, tablets, game console, game controllers, smart phones, smart watches, smart clothing (generic), smart health (BP/glucose monitoring) etc.

Next, some guesswork and assumptions…


Consumer segment share

Autonomous share in segment










In the assumptions in the table above, “autonomous” refers to devices which are designed to operate from battery over the main course of their operation/use cases. This can refer to low interaction devices e.g. humidity sensor, temp monitor/controller as well as high rate ones e.g. a game controller.

Plugging this table of our assumptions on top of the forecasts and assumptions of others, we have 50% share for autonomous IoT devices in the consumer segment i.e. 6-7Bn devices in 2020 and value at $6-700Bn.

Conclusion: autonomous IoT devices look attractive enough to consider.

*I note that some reports consider devices with a “human data input” interface not to be part of IoT, but part of general internet evolution i.e. PCs, tablets and the primary usage mode of smartphones.

In many ways, I like this definition, but given the fast pace of technology evolution it seems too binary to be sustained. For example, consider a simple autonomous sensor but with a button to enable voice interaction. I believe that the voice interface will have a hugely disruptive impact on the design of and our perception of the capabilities of simple autonomous sensing devices.

Here is the link to Amazon’s Alexa offering which is available to be integrated into 3rd party devices, offering natural language parsing and the possibility to define a custom set of actions (skills kit) according to the spoken phrase. Talking toothbrush anyone?

Internet of Things: Challenges using standard hardware modules

There is a huge amount of hype related to the internet of things as we have already explored in a previous blog.

However in its current state the IoT market consists primarily of a myriad of proprietary solutions optimised for a given application; with these conditions it does not seem likely that IoT will deliver on the hype around it. If that situation changed and standardised radio interfaces were used along with general purpose hardware modules which could be purposed for  application by software alone then the market could explode.

In order to make the internet of things realise its potential it is imperative that the creation of networks is both straight-forward and low cost.

The availability of wireless enabled computing elements such as the Raspberry Pi or ultra-low power elements such as the Nordic nRF52 promise to enable the creation of Internet of Things systems with very low cost and great configurability. However the reality of creating such systems is more complex than it might be.

Raspberry pi 3 with built-in wireless capability

Types of wireless compute elements

There are fundamentally two types of autonomous compute elements in IoT networks:

  • Battery powered without frequent re-charging. The over-arching design objective is minimise energy and power consumption (to use primary cells or perhaps solar charging) which prevents the use of current WLAN technologies and drives a demand to minimise processing on-board. The relevant RF communications candidates for these devices are Bluetooth and ZigBee/Thread. Generally speaking these elements require an intermediate gateway to connect to the internet. These elements will be referred to as sensor nodes.
  • Mains powered or battery with frequent re-charges. In this category ultra-low power is not a driver, RF link technologies such as standard Wi-Fi, proprietary (e.g. SigFox) or cellular are most appropriate to connect to the internet. Included in this category potentially are smart phones. These devices may either gather data themselves or else harvest it from the ultra-low power devices detailed above; in which case as well as possessing radio technology to connect to the internet, they must also contain radio technologies such as Bluetooth or ZigBee. These elements will be referred to as gateway nodes.


Connecting up

For a typical IoT application in addition to the elements detailed above the following are required:

  • A wireless router or a cellular base station connected to the internet.
  • A cloud application to aggregate, analyse and display data. In addition this application can also monitor and control the nodes in the network.

For this system to work in a ‘fully horizontal’ manner the interfaces between each element should be well defined and published and could therefore be connected like ‘lego’. However there are certain challenges which need to be overcome. The key questions which need to be initially addressed are:

  1. Choice of radio technology to connect the nodes.
  2. Choice of higher level communications protocol to gather/deliver information between the nodes and the internet based cloud application.

These two questions will be addressed in further blog posts appearing here.