M2M – It takes a village

On a nondescript road not too far from the Hewlett Packard Garage that marks the birth of Silicon Valley, US wireless carrier Sprint has a small premises dedicated to the next great growth opportunity for the mobile industry. The M2M Collaboration Centre enables Sprint to bring together 40 partners to create bespoke M2M solutions for any organisation that needs them.

Sprint lags its tier one peers in the US market when it comes to M2M. AT&T is arguably the most advanced carrier in the world in the space, while Verizon has a joint venture with Qualcomm, N-Phase, illustrating its own early commitment to M2M. But in June this year, Sprint will launch its commercial M2M solutions arm, the Collaboration Centre.

The firm already has more than 400 M2M products certified on its network, according to Sprint’s Geoff Martin, who is responsible for the work that goes on at the Collaboration Centre. Existing solutions including DVD rental kiosks, taxi cabs and e-readers like Amazon’s Kindle. “Sprint helped to spawn the M2M goldrush,” Martin says, “but now we’re playing catch up.”

The Collaboration Centre is key to the chase for Sprint. The firm’s partners in the space, which range from small, vertically focused app developers all the way up to vendors like Ericsson, between them cover every base in the M2M solutions game, Martin says. Sprint, aware through experience that network operators need to understand that they have a certain role in the value chain, he says (Sprint has tried and failed four times to build internal app development programmes), is responsible for creating an ecosystem. “With M2M it really does take a village,” he says.

Sprint has some unique challenges that sit across its entire business. Chief among these is a complex mix of network technologies—cellular CDMA, iDEN and WiMAX—that makes a coherent technology strategy difficult to achieve. As the rest of the US market marches unified towards LTE, Sprint has yet to proclaim its future allegiance but its WiMAX play is looking increasingly isolated. Martin concedes that “there is a high likelihood that LTE is in our future.”

“Operating three separate networks is incredibly expensive and not cost effective,” Martin says. “We’re sitting on some of the most powerful spectrum in the industry and we’re using it to power a 1.5G push to talk network.”

Sprint also lacks the economies of scale that come with membership of the GSM clan; something that directly impacts on its M2M business in the shape of module costs. “We love Qualcomm,” Martin says, “but because we’re a CDMA player we’re subject to the Qualcomm tax. Because all our modules are licensed to them, they are more expensive; 15 to 20 per cent higher in cost than GSM.”

And here, he says, WiMAX offers a benefit. WiMAX modules are half the cost of GSM modules, he says, adding “one of the things we like about WiMAX is that it gets our foot in the door and we can get really good economics.”

Certainly it’s not about speed. Few M2M applications require high throughputs and Martin says that, while his competitors are moving to LTE, and while Sprint is figuring out its own technology evolution, it is also investing in its legacy 1xRTT network; technology that he says Sprint plans to “propagate well into the future,” with its M2M play in mind.

Sprint has partnered with Aeris to provide its M2M platform after concluding that it would simply take too long for it to develop a platform in house with its billing suppliers. Partnership is the essence of M2M, he suggests: “Our biggest value add with M2M is getting out of the way of people who know what the heck they’re doing,” he says.