T-Mobile launched a Narrowband Internet of Things (NB-IoT) service nationwide, today, the first such network in the United States, which may shake up who jumps into commercial NB-IoT in the future, according to Craig Moffett, principal, MoffettNathanson.
Facing an FCC-imposed deadline of a little more than 600 days, Dish Network is also focused on building an NB-IoT network. Because Dish has missed several intermediate construction deadlines, the FCC has pressured the satellite TV company to build out its spectrum. But Moffett questions whether a need for an additional NB-IoT network will recognized by the Commission.
“The very presence of a network like T-Mobile’s – which is now already in operation – is likely to materially reduce the attraction of such a network from Dish Network for the FCC. One possible argument in favor of Dish’s proposal was that it would at least be a novelty. Not anymore,” Moffett wrote in an email to investors.
Built on the 3GPP standard, the NB-IoT service is a low power, wide area network (LPWAN) LTE-Advanced technology that provides a pathway to 5G IoT. The network, designed with Nokia and Qualcomm Technologies, will use the spectrum in T-Mobile’s guard bands.
“A few things jump out to us: first, the fact that T-Mobile is able to construct a narrow IoT network out of guard bands seems to suggest that they believe the actual consumption of a low power wide area network will be de minimis,” wrote Moffett. “The second is the fact that, at just $6 per year, it is clear that the monetization capability of a network like this is very low… and that there is no conceivable economic model for an IoT-only network that doesn’t piggyback on the sunk costs of a network already built for more profitable uses.”
Unveiled earlier this year, T-Mobile’s NB-IoT plan costs $6 a year – one tenth of Verizon’s Cat-M plans – for up to 12 megabits per connected device. Several NB-IoT modules based on Qualcomm MDM9206 LTE IoT modem are certified for use on T-Mobile’s network. For applications that require more bandwidth and voice, T-Mobile also offers Cat-1 IoT Access Packs.