IoT is happening now and it is a progressive evolution as opposed to a sudden seismic shift. Variety of connected things are examples of how this paradigm is proliferating into everyday life, one step at a time. Benefits of applying IoT into your business are countless. Predictive maintenance, monitoring and locating things, differentiating your product, closer communication to your end-users, lowering cost and adding new revenue streams are just some prime examples of IoT benefits.
Applying IoT will bring some costs to your business as well. In terms of OpEx for IoT projects, cost of connectivity to your mobile operator (service provider) could account for 25-40 percent of the overall spending for delivering IoT services. This can be a big cost driver, if not managed and control proactively.
I have been selling global managed IoT connectivity for about 4 years and wanted to share 6 advices which I always recommend to my customers.
1. Monthly fixed fees per SIM: Check if your Operator will charge any fixed fees per SIM/month. Typically these fees shall only be applicable for activated SIM cards. Remember some devices might be dormant for a while, in such cases try not to lock yourselves to pay these monthly access fees.
2. Low cost data network plans: IoT devices typically use small amount of data but generate a lot of signaling in operators networks. Knowing/guessing the actual usage of your IoT devices might be challenging. Pay as use is always a good start (don’t forget to hard-cap your SIM cards, otherwise you may get a bill-shock). A big majority of IoT SIM cards typically subscribe to a fixed amount of data per month. This might be a good model depending on the use case.
Pooling is quite popular as well. We at Tele2 IoT provide 2 types of pooling as; flexible pool and fixed pool. Flexible pool is good if your business is growing and fixed pool might be attractive if you are generating a lot of traffic and your IoT deployment is quite stable. Remember all these rate plans can be either pre-paid or post-paid.
3. Overage fees: This is the fee incurred if you exceed your assigned rate plan. In general, I see that most of the rate plans are either under or over utilized. This is a waste of money in both cases. At Tele2 IoT, we have solutions which proactively monitor your data consumption and enables you to optimize your rate plans against your actual monthly data usage. So, you never get bill shocks or never under-utilize your rate plans and waste your money.
4. Roaming: Especially for moving devices (like telematics, automotive, trailers, containers, fleets etc) you must consider where in the world your devices will travel to. You don’t have to know this in advance. Tele2 IoT’s Cisco Jasper SIM management platform will assign the best rate plan to your SIM cards depending on where the SIM cards is. So you save expensive overage/roaming costs. We also provide Russian-doll model, meaning more expensive roaming zones covers less expensive zones, so you don’t have to pay overage fees in case you travel to less expensive zones.
Regarding roaming remember that some Operators are steering your traffic to a network (because they have better margins with that pre-selected network provider). This may create some QoS issues (lost connectivity, latency, zero byte sessions, no coverage etc) for your IoT service. Make sure your traffic is not steered and SIM connects to the best signal, not to the cheapest network.
5. Rounding: As mentioned above, IoT devices typically use small amount of data (few Kb or Mb) but generate a lot of signaling in operators networks. This signaling drives an internal cost for operators and we consider SIM cards that open/close sessions quite frequently as aggressive device. This aggressive behaviour is neither good for the Operator nor for the customer. Because remember that every data session that you close will be rounded to the nearest Kb. This will drive data usage costs up for around 15% for badly designed IoT devices. Multiply this cost with numbers of active SIM cards, and you might be facing a bill-shock. We at Tele2 IoT follow GSMA IoT Connection Efficiency Guidelines to help our customers design smart IoT devices.
6. Any other costs: There might be any other cost for the platform, API costs, SIM cards, APN/VPNs, or even taxes. I recommend you to keep all these costs in mind when building your business case. Aslo, working with an operator who is skilled, global and can provide some self service efficiency, will also help you to keep costs down.
All in all; if your IoT SIM cards are fully dependent on your operator, every change in the SIM lifecycle requires involvement from the carrier’s support team, which will add administrative costs and slow down the process.
With Tele2 IoT, you get:
- Real-time overview of the behaviour of every device
- Self-service ability to make connectivity lifecycle changes
- Remote diagnostics to understand what’s happening when a SIM card has complications
- Analytics and automated tools to resolve it quickly
To learn more about how we at Tele2 IoT can help, please visit www.tele2iot.com/2CONNECT