Bosch Connected IoT Conference

2018 Bosch Connected World

It has become increasingly obvious that in practice, the Internet of Things (IoT) can be simplified into three generic applications – location tracking, event monitoring and condition monitoring. The rest is about applications to get data into the system, and to respond appropriately and securely to changes. What is less clear is telcos’ role in the emerging IoT ecosystem.

This was highlighted at Bosch Connected World 2018, a two-day conference and invited exhibition in Berlin, which attracted 4 000 visitors, ten times more than at the maiden event in 2014.

Bosch: A Prime Enabler

As one of the world’s leading makers of electrical and electronic components and finished goods, Bosch is both a consumer and a producer of IoT artefacts. It has some 270 factories, making the firm its own best guinea pig for Industry 4.0 factory automation experiments – a prime enabler and a leading source of knowledge about what works and what does not.

According to Bosch CEO Volkmar Denner, every product the company ships will be capable of connecting to a network by 2020. Some 60% of its products now support Internet Protocol (IP), up from 10% last year. In 2018, it will ship some 38 million IP-enabled products (up from 27 million last year) which includes finished goods.

Mikey, a voice-operated Bosch home automation platform, similar to Apple’s Siri or Amazon’s Alexa, will allow home owners to interact with their kitchen appliances. Mikey can check the refrigerator’s inventory, recommend suitable recipes based on the content, and pre-heat the oven for just-in-time cooking.

Co-Developing Products

Bosch will be co-developing products with customers which could result in components such as sensors and lightweight combined electric gearbox-axles integrated into products. Planned for launch in the early 2020s is Daimler’s new S Class Mercedes Benz which will be enabled to park itself (after automatically finding a suitable spot in the parking garage), as well as their new robot taxi. The Deutsche Post – DHL electric self-driving mail wagon is closer to launch and will free postal delivery staff from having to carry the 115kg payload.

A constant refrain from every speaker at the conference was that a concerted effort will be required for the IoT to be a success. Like many large firms, Bosch bought its way into the IoT by acquiring smaller firms, and now partners with and supports a host of nimble software-based start-ups to develop and deliver solutions. This partnership model is the only viable way of dealing economically with the complexity of tracking assets, watching them, and getting them to respond appropriately.


Clearly, nothing will happen without connectivity, so networking is the central, crucial, enabling infrastructure for the IoT. But Bosch’s strategic pillars are sensors, software and services. Bandwidth is a commodity to be bought from the lowest priced supplier who can deliver the speed and resilience required by the application.

Bosch believes most machine-to-machine communications will be local and limited to the machine, production line, home or factory automation system of which it is a part. Relatively little data needs to break out into the Internet or the public network.  For example, most on-board electronics will aim to keep passengers, cargo and vehicles safe in transit. Low latency is a non-negotiable. At the outset, vehicle-to-vehicle and vehicle-to-infrastructure (street) communications are likely to use Lidar rather than 5G. And edge computing (with edge data centres) will reduce the amount of traffic transmitted over the access and core networks.

There are some emerging applications that require massive connectivity and bandwidth for which telcos may be uniquely suited. One such example is a city or regional Intelligent Integrated Intermodal Transport System. Passenger and goods needs are sensed, data is fed into a centralised processing systems that control the allocation of vehicles, timing of journeys and information is communicated back to the users. Notwithstanding, advances in decentralised computing and artificial intelligence-based self-organising systems may limit core network traffic.

Telco Opportunity

Inevitably, industry standards for applications and vertical markets will precipitate out of the present alphabet soup of initiatives. This presents an opportunity for the telcos to play at the scale to which they are accustomed.

Nevertheless, customers are looking for someone to take responsibility for connectivity in every IoT-based system. Telcos can reorganise to service the granularity required for individual systems, or partner with firms that are prepared to get their hands dirty assembling and managing the (mostly) customised applications. Offering customers that “one throat to choke” may be risky, but it might also be telcos’ best chance of becoming essential members of the emerging IoT ecosystems.

A sensor-laden mock-up of a self-driving car Bosch is working on, on show at Bosch Connected World 2018 in Berlin.

A sensor-laden mock-up of a self-driving car Bosch is working on, on show at Bosch Connected World 2018 in Berlin.


2017 AfricaCom Conference Review

About the event

The annual AfricaCom event was held at the Cape Town International Convention Centre (CTICC) from 7-9 November 2017, with a line-up of global thought leaders who provided interesting insights on future technology trends and market developments in Africa. The event also offered a good networking platform for industry players and essential learning opportunities. The event also marked 20 years of AfricaCom, which has become the largest ICT event on the continent.

A summary of key discussion points and take-ways from the conference is provided below.

New trends

M-commerce was notably among the disruptive technologies that were under the spotlight at the event and is expected to be far more “disruptive” than PC-based e-commerce ever was. In the next 6 years Africa is expected to lead digital solutions, with companies with clear digital strategy expected to lead the market. Among the key messages delivered at the event was the need to encourage local manufacturing companies to take a leadership position in the region. Other notable topics that were discussed included Big Data, Artificial Intelligence, Smart Cities, Digital Health, SDN & VFN, and Blockchain.

A growing trend is that of governments trying to recreate monopolies in the market, instead of creating an enabling environment for competition to thrive and intervene in markets such as rural areas, where it often does not make economic sense for private sector companies to invest. This is coupled with a growing practice by governments of treating telecoms sector businesses as cash cows. Some of the operators claim that as much as 60% of their revenues are taken by governments. The key message from the operators on this issue was that ICT should not cross-subsidise other industries, so that revenues generated in the ICT sector can be reinvested to further sector development and innovation.

A single national network model, such as the WOAN proposed by the South African government, also came under scrutiny, with operators sharing a common view that this model could be harmful for the telecoms sector. Furthermore, market regulators need to be educated on a continuous basis, in order to be able to regulate very dynamic markets effectively.

IoT and high data costs

The issue of data costs was very topical. From an operator point of view, the cost of operating a telecommunications network remains very high in many markets across Africa. Lack of proper utility infrastructure negatively impacts the operational efficiencies of telecoms operators, which in turn results in higher retail prices of data than the public and the state would like to see. Moreover, there is also the question of economic principle, with operators in most markets opting to charge for data what they can, if not constrained by regulation. More can be done in terms of trying to reduce the retail price of data to benefit users. Operators such as Safaricom (Kenya) are reviewing their data charge models to see how prices could be reduced further.

However, other operators are of the view that MNOs no longer generate large profits as they had done in the past, largely due to competition from the OTTs who have negatively impacted the price of voice services. Decreasing voice revenues do not leave the operators with much room to move when it comes to lowering prices of other products (such as data).

A panel discussion on IoT resulted in a call to use IoT to transform the telecoms industry. IoT will also help businesses to be more efficient. Africa is expected to benefit considerably from IoT, particularly in sectors such as mining, transport, tourism, health and energy. As such, security around IoT platforms needs to become a priority.

The journey to 5G

3G is expected to continue carrying most of the traffic in Africa as the technology lifespan is usually 20 years. Most operators in Africa began 3G deployment 5 to 10 years ago. However, operators should not be rolling out 2G and 3G networks in isolation. As we enter the new era of high speed connectivity, when 5G eventually arrives, the technology is expected to drive real convergence. It is believed that in the next six years, the world will be ready for 5G, with the first subscriptions expected to start early in 2022. Africa is expected to reach 2 million 5G subscriptions by the end of 2023. However, the predicted commercial launch of 5G services could be brought forward, given that by the end of 2017 the first phase of 5G standard will be completed. This will allow early adopters to launch commercial offerings, particularly in the developed markets.

Some of the speakers at the event believe that Wireless-to-the-Home technology will drive connectivity globally and not fibre, as many anticipate. Nonetheless, the deployment of fibre will continue to be essential, as it does serve specific needs in the market more effectively than wireless technologies.

Bridging the digital divide

On the need to connect Africa’s next billion, a study revealed that of the 240 countries that were part of the study, some 104 do not have broadband strategy. For African countries to grow their GDPs, they need to prioritise broadband rollout. The example of Singapore was given, which came from a historically low ICT ranking to become one of the leading countries globally by prioritising broadband rollout. Currently, Africa contributes less than 5% of the global GDP and 75% of the people on the continent do not have smartphones. Moreover, 50% of the people in Africa are still serviced exclusively by 2G networks. Several initiatives are being undertaken by various companies to bridge the digital divide in Africa. These include:

  • SmartWIFI – The hotspot service is intended to bring WiFi to rural areas, enabling retailers, hospitality establishments, petrol stations, as well as healthcare centres or schools to become a connectivity point and a digital gateway to opportunity for the surrounding population. Access can be extended to several kilometres through off-the-shelf Wi-Fi repeaters.

Project Loon – A network of balloons located at the edge of space is designed to extend Internet connectivity to people in rural and remote areas worldwide at an affordable cost. If successfully rolled out across the African continent, Project Loon has the potential to assist countries with low Internet population coverage to achieve nation-wide coverage. Connection signal is transmitted up to the nearest balloon from  a telecommunications partner on the ground, relayed across the balloon network, and then back down to users on the ground. The demonstrated data transmission speed between balloons over 100 km apart in the stratosphere and back to earth (directly to LTE devices) is up to 10Mbps.

  • The Express Wi-Fi initiative will be expanded through a partnership with Facebook in Nigeria, with the goal of connecting more people to the Internet in a cost-efficient way. Express Wi-Fi in Nigeria is focused in areas where people gather and work, including markets, cafés and public outdoor spaces.

Creating an enabling environment

African countries are encouraged to start educating rural communities, empowering them to use devices to enable growth. However, lack of access to the Internet, lack of local content, lack of spectrum, lack of affordability (costly devices) and a poor demand side (due to lack of proper education, particularly in rural areas) are some of the key issues that are contributing to the current digital divide in many parts of Africa.

Furthermore, governments are urged by the operators to create enabling environments to support innovation in Sub-Saharan Africa. For their part, some of the state governments in Africa are already taking steps to improve ICT penetration and use it as a socio-economic enabler. Examples include:

  • Namibia – Currently, Internet penetration is around 50% of the population but the country has declared access to the Internet a basic human right and wants to achieve 100% population coverage in the next two years. New investment initiatives should be announced soon.
  • South Africa – The Ministry of Telecommunications and Postal Services is urging operators to consider bridging the digital divide through the greater use of satellite broadband services, with satellite technology offering far wider coverage than terrestrial networks. It is disappointing that of the 100 satellites to have been launched globally in 2017, only five will have been launched by African states. There needs to be greater focus on the use of satellite technology in Africa.
  • Zimbabwe – The government is the biggest spender on ICT in the country and intends to accelerate mobile network deployment. The government has interest in 2 out of the 3 MNOs operating in the country. New policies have been introduced, which will encourage infrastructure sharing between the operators.

To reduce the cost of communication, initiatives such as uniform roaming charges between operators in an economic community such as SADC and joint infrastructure investment by operators should be encouraged.

IoT Pic

South African IoT/M2M Market Opportunity for Network Operators

The global IoT/M2M installed base is expected to reach between 12.5 and 13.3 billion by 2020, and show a CAGR of over 20% over the period 2015 to 2020. In South Africa, we forecast that the IoT/M2M installed base will reach 35 million by 2020, showing a CAGR of 32% over the same period. While these numbers grab many headlines, network operators need to recognise that their revenue opportunity will come from managed connectivity, which accounts for roughly 20% of the IoT/M2M service revenue, and not the connectivity itself. Revenue earned from connectivity itself, only accounts for around 11% of the service revenue.

Global Outlook

Network operators (mobile, fixed and wholesale) have started to turn their attention to the rising Internet of Things (IoT) and machine-to-machine (M2M) opportunity. Global predictions vary, with some reports such as the IHS Markit showing that the number of IoT/M2M connections is expected to rise to 12 billion while IDC have reported that IoT/M2M connection will rise to 28 billion by 2020. This range illustrates the challenge in forecasting a rapidly growing market.


For example, the following chart shows a comparison of the various global forecasts of the installed base:

2017 Global IoT Installed Base Forecast

Forecasts made in 2016 and 2017 for the 2020 global installed IoT base, show that the installed base is expected to reach between 12.5 and 13.3 billion. Most forecasts show a CAGR of over 20% over the period 2015 to 2020.

The South African IoT Connectivity Development

In South Africa, as in the rest of the world we can expect to see the Low Power Wide Area Networks (LPWA) IoT battle lines drawn along technology. The LPWA platforms include Extended Coverage GSM for IoT (EC-GSM-IoT), Long Term Evolution Machine Type Communications Category M1 (LTE MTC Cat M1, also referred to as LTE-M) and Narrowband IoT (NB-IoT).  In the first camp the main protagonists will be the mobile network operators, such as MTN and Vodacom, both of which have announced IoT plans based on LTE narrow band technology, using licensed spectrum.  On the other side, will be the LPWA platforms such as Sigfox, backed by Dark Fibre Africa subsidiary SqwidNet, using unlicensed ISM bands.

The mobile network operators will position their services based on service quality as their ability to manage the spectrum will ensure a quality service for the enterprise. The mobility factor will see applications such as the “connected car” and vehicle tracking being among the major drivers of IoT/M2M uptake for the mobile operators. Providers using platforms such as Sigfox will opt to focus on volumes, low power and short transmission distances to offer services and solutions for more static applications such as smart metering and utility services.

Forecast of the South African IoT Installed Base

Africa Analysis forecast that the installed base of IoT/M2M connections will rise from 8.8 million in 2015 to 35 million by the end of 2020, showing a CAGR of 32%.

  • A large slice of the market will be found in the LPWA technology, rising from around 290 thousand in 2017 to over 19 million by the end of 2020.
  • Other technologies such as mobile cellular, Wi-Fi will retain a steady growth of 14% and 11% respectively over the forecast period. Mobile cellular will rise to 8.7 million connections and Wi-Fi will rise to 7.4 million.
  • Satellite services will retain some importance in the local IoT/M2M market but the applications will be restricted to a niche market such as aviation and rural areas.

Network Operators and the IoT Service Revenue Stack

The forecast of the large installed base of IoT/M2M connections sounds very attractive, and these big numbers grab a lot of attention. But the sad reality is that the connectivity revenue opportunity for just proving network connectivity is limited. In 2016, the connectivity portion of the IoT revenue stack accounted for around 11% of total revenues. The lower cost of connection and the associated downward pressure on data tariffs will continue to keep this contribution under pressure.

The attractive revenue for network operators is found in the stack of services associated with connectivity. For example, managed connectivity accounts for roughly 20% of the IoT/M2M revenue.

Given this, we expect that IoT deals will likely to be driven by volumes that will see network operators sacrificing some of their connectivity margin to secure contracts.  However, this basic element of the stack will see operators use connectivity as a foundation to offer managed connectivity services. This way, the MNOs will be able to take advantage of both the basic and the managed connectivity services, thus increasing the portion of total revenue they will be able to access in the IoT environment.

Those network operators with the necessary resources are able to push themselves further up the value chain and possibly offer more complex services such as integration, which accounts for around 47% of total revenues while application development will account for around 22% of total revenues.

Contact Richard Hurst, Africa Analysis, for more information on this topic.

IoT Trends

2016 Internet of Things (IoT) Outlook Report

The study reveals that roughly four in five respondents believe there is a lack of consensus over the best way to strategise, deploy and monetise IoT. This is one of the key findings reported by Intelligence, who conducted the study.

2016 Market Survey
Of the roughly 1 000 respondents surveyed for this report, exactly 50% came from the service provider community – including MNOs, cable operators, ISPs, multiplay operators, broadcasters and cloud service providers. Service providers are frequently referred to as the great enablers of Internet of Things (IoT), and thus represents the primary market for this study. The second greatest group of respondents after service providers represent suppliers of IoT services, with 17% – this group includes hardware, software, services and application development vendors. Consultancy, analyst or research firms made up an additional 14%, while the remaining fifth of respondents originated from a range of sources including more niched telecoms services, government agencies, education institutions and industrial end-users of IoT technology.

Key Take-Outs

#1 Navigating the IoT landscape?

  • Roughly four in five respondents believe there is a lack of consensus over the best way to strategise, deploy and monetise IoT.
  • More than half the audience says IoT and M2M have now come to mean the same thing.
  • IoT services will be responsible for up to 50% of business revenue by 2020, according to half the audience.
  • In the next 12 months, just under half of our respondents expect to generate between zero and 10% of their revenues from IoT. Elsewhere, less than one fifth expects IoT to generate 10-30% of revenues, less than one tenth says up to 50%, and less than 5% expect to be able to attribute IoT with more than half of their total revenues in the next year.
  • By 2020, however, more than half of all respondents expect IoT to be responsible for somewhere between 10% and 50% of their total business, while 17% believe it will be 10% or less. A further 16% say more than half of their business will be directly concerned with IoT, and 15% opted against mustering a best-guess effort.

#2 Cloud platforms for IoT

  • 49% of respondents say data analytics is the most important feature of an IoT platform.
  • IoT services will mostly be built in-house instead of outsourced to third-party vendors, according to 70% of the audience.
  • Two thirds of respondents believe 5G will be the main connectivity platform for IoT, when it arrives.

#3 Optimising IoT connectivity

  • More than half the audience plans on using their existing radio network for both people and machine-based communications.
  • Nearly 90% of respondents see permanent roaming as a major challenge for businesses providing IoT services.
  • The radio network will carry up to 50% of IoT traffic in the future, according to nearly two thirds of the audience.

#4 Securing the IoT

  • Nearly two thirds of respondents believe IoT will present new and unique information security challenges.
  • An additional two thirds think IoT is more vulnerable to security leaks due to the volume of devices and traffic being generated.
  • One in three respondents think they don’t experience any DDoS attacks.

#5 Industrial IoT

  • Nearly half the audience says professional enterprise services and analytics software will be the biggest revenue generator for industrial IoT.
  • 81% believe telecoms operators will face threats from new market entrants as a result of IoT pervasion.
  • Just over a quarter of respondents feel conflicting standards will inhibit industrial IoT’s potential.

#6 Consumer IoT

  • Nearly two thirds of the audience believe consumer-related products will be a major element of their IoT strategy.
  • Just 7% of respondents think wearable tech will really take off.
  • A completely driverless experience will be the biggest benefit of connected cars, according to 27% of the audience. IoT Outlook Report 2016 Intelligence, analyses and presents the findings of an in-depth questionnaire answered by 900 members of the telecoms industry involved with IoT today.