Blogs

From stand-alone to IoT – a practical solution for the OEM – Part 2

In the second part of his blog, Dennis Poulsen, the general manager of Spirent’s IoT Connectivity Products, concludes his exploration of the IoT options for the OEM. The most immediate solution would be to buy SIM card reader components and build them into the product, which can then be sold as “Internet enabled”. The customer then buys the device, chooses a suitable mobile service provider and a suitable connection package, inserts the SIM card and configures and customizes the product themselves.

But solutions based on external SIM cards will cost more to manufacture, and will lock the vendor or users into long-term contracts. This might be acceptable for a major one-off purchase, but not for a broader consumer market, or for a fleet manager rolling out a large population of devices. In that case it would be better for the retailer or solution provider to manage the connection as a service – but that could add a lot to the retail cost of what is intended to be a mass-market product.

Another approach would be to embed the SIM functionality into the device without the card, saving the added cost and complexity of a reader hardware and the card itself. But an embedded SIM solution locks the manufacturer into specific SIM software, and the subscription management provided by a single vendor and a specific carrier.

Opting for a closed ecosystem like this denies the opportunity to negotiate between service providers and adapt your product offering to the business climate. You could market an identical product with a choice of different mobile networks, but that would require stocking multiple units for the same product, as well as having to negotiate rates and SLAs locally.

What is needed is the reduced cost and footprint of a built in SIM function, but one that can be programmed to any carrier and subscription as needed.

The programmable SIM solution
Instead of building SIM hardware into the device, there is a radical new approach that not only slashes the bill of materials but also allows far greater flexibility. The OEM can load provisioning of Access Point Name and other connectivity parameters plus a SIM operating system directly into the device on an integrated secure hardware element, effectively embedding a virtual SIM that can be programmed as and when needed.

Instead of having to integrate the ESIM into other people’s servers for each deployment, connectivity is enabled on demand via an open Subscription Management Cloud service that is being made available to the entire IoT ecosystem. There is no vendor lock-in and the embedded SIM is remotely re-programmable: so carrier connections can be downloaded, customized or switched when needed. If the deployment includes hundreds or thousands of units, they can all be reprogrammed at a stroke without needing individual attention or physical adjustment.

This is not merely a time and cost saving exercise, it heralds a whole new business opportunity. The existing connectivity model tightly locks together physical SIM cards, networks and long-term subscriptions, while the carriers want to maintain direct customer relationship. Customer ownership is shared between the carrier and OEM, while OEMs and end-users are locked into long-term contracts that make it difficult and slow to adapt changing to business conditions. Instead, this new approach effectively enables the OEM “unshared” customer ownership and to become a service provider – offering any number of carrier options, or only the preferred carrier, to its end customers.

With the Connectivity and Subscription Management Cloud, you now have an open IoT ecosystem for OEMs, chipset manufacturers, carriers and application developers. For the end user, once the product is unboxed, it can automatically connect to the customer’s chosen network – and an entire device fleet can be re-configured at a stroke whenever needed.

In Q4 this year the product will become fully available – with an embedded SIM client, i.e. SIM without the card and a subscription management platform – to M2M modem companies, major semiconductor companies and device OEMs.

The benefits of this new approach will be far reaching. Consumers will enjoy freedom of choice and great user experiences. A SIM card-less alternative reduces costs and increases flexibility for enterprise customers. Only one stock-keeping unit, plus automatic connectivity activation anywhere in the world, ensures a leaner way to manufacture, distribute and service products.

Given a platform that provides universal global connectivity, extreme scalability and a simple user experience, OEMs will gain total customer ownership and life-cycle long stream of revenues.

The IoT opportunity becomes practical reality.