The True Cost of Building the Internet of Things

In a recent Forbes article, B2B spending on the IoT technologies, apps and solutions will reach $267 billion by 2020 and Statista forecasts that the market value of IoT will be $1,391B next year.

It is a huge market and many are rushing to be a part of it, but what are the true costs of starting an IoT company? JP Meijers, the Initiator for The Things Network in Cape Town and engineer at Polymorph, and I list five factors to consider.

Communication

The radio spectrum is a limited resource that all of us need to share. Have you ever been to a huge event like a football match or a concert, and your phone couldn’t connect? This was the radio spectrum being overloaded by the sheer amount of devices that tried to connect.

For IoT where we will have thousands of sensors in a small space, this will also be a problem. Luckily new technologies are arising which tries to solve this. At Polymorph we regularly look at LoRaWan for our personal projects, and specifically how The Things Network implements it. Even though LoRaWan scales well, the radio spectrum can only fit so much.

For large scale products, our relationship with Telenor has helped our clients scale fast and efficiently. Remember that laws govern IoT differently in different countries and one must think of this when, for example, you are monitoring trucks that crosses countries.

Energy

How will the battery run on these IoT systems? This is dependent on the technology utilised. Prior to  the launch of LoRaWAN, Sigfox and NB-IoT, we were reliant on GSM. Although great for long distance tracking, GSM is data and energy heavy, fortunately with the new IoT technologies, we have an array of energy efficient options available to work with.

Battery life is impacted by events that such as how often messages are sent, the size of the messages, the power usage of the sensors and other electronics on the Thing (GPS is also power hungry), the communication technology used, the processor used, etc so a battery can last longer or run down faster dependent on these factors. Other options are to charge the devices or to use solar panels when they are outdoors, but this would depend on the size of the device which is decided by its functionalities. For example, a wearable can be charged by plugging it in for a few hours, but weather monitors which are placed outdoors can’t be easily brought inside to charge. The point is that one will have to consider how your IoT devices will be powered as well as how to replace device batteries or replace devices. This maintenance plan impacts the pricing of the devices as well as the running cost of the IoT system.

Interesting recent discussions on creating an energy source for IoT is the Piezoelectric Effect.

Costs

Replacing batteries or using throw away devices depends greatly on the function and requirement of the device. Device choice and replacement are not the only costs one is going to have to factor in. Data costs, sim cards and management of the sensors and data are all costs that one must consider. One of the most valuable aspects of IoT is the information gathered, so don’t forget to take your data processing costs and storage costs into account.

Scaling

Going from a prototype to 100’s or 1000’s of devices as one scales can bring the entire project to a standstill, unless you have implemented a plan. Thus, for true success, your IoT product must be able to scale. Driving out and configuring multiple devices eg placing monitoring into vending machines adds cost and complexity to your IoT product. Here are a few ways to assist with scaling:

  1. have all aspects on sensors and devices identical, except for the unique identifier which allows you to speak to each one individually
  2. if  it is a wearable, you can outsource the device registration and updates to the user. This will help you cut down on scaling costs related to installation and configuration
  3. ensuring that updating in the field is possible over hundreds to thousands of devices. Ways to ensure that updating is successful is to stagger updates. This means you can test to ensure it was successful and prevents a spike in bandwidth usage.

An important aspect to scaling is to either build for scaling from the start or build fast and know that scaling will be a part of the growth. The latter means that you are best positioned to know where scaling is required as well as ensuring the you have the resources to grow.

Maintenance & Management

A golden rule of development is ‘whatever is created must be maintained’. Keep this in mind when developing your IoT system. It is elaborate with hardware, software, cloud, sensors, devices and the list goes on, so make sure your IoT ecosystem can be easily maintained.

At Polymorph we work with partners such as Telenor to ensure that your IoT product is easy to implement and scalable. Contact me if you would like to chat more and join the The Things Network to come to one of the gatherings in Stellenbosch next year.

A final word on IoT…

Environmental impact

An often ignored element in the discussion of IoT is the environmental impact. Not only in the creation of the products, but in the waste management. With devices designed to last two years, how can we manage the waste that we have built into the system. The EU already has strict regulations on wastage and I believe that it will soon impact South Africa. But do we need regulations to ensure that our environment doesn’t become cluttered with discarded devices? Let’s build waste disposal into the process from the start

Please see my articles on IoT


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Richard Barry

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CEO of Polymorph

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JP Meijers

Linkedin IoT Engineer

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