LTE (News - Alert) has been promoted and perceived as a 4G development that has higher data rates than earlier generations. The feature-rich, real-time communications services that an all-IP network enables tend to be overlooked and that is unfortunate. But what, you may be thinking, is the relevance of that functionality to M2M?

At first sight the answer is very little. The data rates – average throughput 48 Mbps downlink and 30 Mbps uplink – are ideal for video surveillance applications, but the rates for 3.5G networks are more than adequate and they are up and running. Moreover, most M2M apps don’t need high-speeds: a typical app may have less than 30 bytes of data, although the communications overhead can be 500 to 600 bytes: well over an order of magnitude. More on that issue in a moment. Anyway, it’s a very light payload, and M2M’s amazing success in recent years indicates that those networks are working well.

So what is the answer? It lies in the number of transmissions, which are heading North at an even more amazing rate.  Current business cases and projections point to explosive growth in mobile data over the next 10 – 15 years. The number of connected devices is expected to grow from more than 6 billion today to 12 billion in 2020. The popular term for this development is “The Internet of Things.”

3G networks are already being constrained and solutions that enable more efficient data communications have been developed, e.g. lightweight protocols. See “Unleashing the Internet of Things“. But the only way to make a significant impact is to use spectrum more efficiently. 2.5G and 3G employ circuit switching for voice and packet switching for data. Packet switching is more efficient and LTE is an end-to-end IP network so it makes much better use of the spectrum. Moreover the system architecture has also evolved and this results in lower operating costs as well as the ability to support more traffic. 

Improved spectral efficiency will allow mobile network operators (MNOs) to offload 3G data traffic onto LTE in order to prevent congestion. In that way they will protect their 3G voice and SMS revenues and at the same time generate significant new revenue streams from all those connected devices. The addressable opportunity for The Internet of Things is expected to rise to nearly US$1.2 trillion by 2020: a sevenfold increase from 2011, so it’s a big target.

Conclusion: M2M needs LTE in order to prevent gridlock on 3G. LTE needs M2M since deployment will protect legacy voice and SMS revenues. If networks became congested then 3G subscribers will churn and revenues will head south. Lightweight communications protocols, MQTT is another, will lower the cost of transmitting M2M data and that’s good for everybody.