Emerging Opportunities in IoT Highlighted at The Things Conference
This week’s The Things Conference in Amsterdam showcased a unique opportunity within the Internet of Things (IoT) landscape, which, while fragmented, shows significant promise. The growth in the LoRaWAN sector, along with fruitful cross-technology collaborations and expert knowledge in specialized enterprises, indicates that IoT is beginning to establish itself and move beyond mere hype. The conference, held on September 23 and 24, centered on the concept of a “niche within a niche within a niche” — a key theme that encapsulates both the challenges and the potential solutions for achieving the long-awaited vision of ‘massive IoT.’ This vision entails a world interconnected by sensors, where profits are abundant, and societal benefits are realized. However, the journey to this ideal scenario will not occur overnight.
Despite the challenges, a growing assembly of participants at this annual gathering, organized by The Things People, a collective behind The Things Network and The Things Industries, remains optimistic about the future of IoT. This optimism may be intensified by the celebratory atmosphere of the event, coinciding with the tenth anniversary of the Dutch organization, prompting reflections on the evolution of IoT. Attendees sensed a shift in the market, as if it has finally grasped the essence of what success entails.
However, no one at the conference was under the illusion that the IoT landscape is suddenly simple. The reality remains that the customer base is highly fragmented, which is mirrored by a similarly diverse supplier market. This complexity necessitates the integration of low-margin solutions derived from a variety of low-maintenance components, tailored for niche segments within even smaller niches. Wienke Giezeman, in his opening keynote, emphasized that these sub-niches possess remarkable potential. He cited facilities management as an example, illustrating that within this sector, there exists a specific focus on monitoring refrigeration. In the U.S. alone, there are approximately eight billion commercial refrigerators that require temperature monitoring, demonstrating the vastness of the opportunity within this particular niche.
Giezeman, while reflecting on the history of his company during its anniversary and welcoming newcomers from various IoT sectors, highlighted how he arrived at the staggering figure of four billion potential IoT connections from the eight billion refrigerator statistic. This figure underscores the abundant potential that remains, echoing earlier predictions about the industry. While the exact numbers are secondary, their magnitude is noteworthy. Giezeman further reported impressive statistics from the conference, which attracted around 2,000 participants from 70 different countries to the historic Kromhout Motoren Fabriek. The event featured a diverse array of Industry 4.0 discussions across three stages, numerous workshops, and a vibrant exhibition floor, boasting a 50% increase in partners, an 80% rise in visitors, and an 80% growth in content.
Notably, the event saw participation from various IoT sectors, including communities focused on Bluetooth, Wi-Fi, Z-WAVE, and Wi-SUN technologies. This cross-pollination of ideas was reflected in presentations, panels, and workshops, with members of these communities actively engaging on the exhibition floor. The cellular IoT sector was also well-represented, showcasing contributions from chip and module manufacturers, particularly with Qualcomm stepping in as a key sponsor through its new Edge Impulse initiative.
However, one of the most significant absences was that of Unabiz/Sigfox, a leading player in the non-cellular LPWAN-IoT space, which boasts approximately 15 million connections. Sigfox’s absence was noteworthy, especially considering the event’s atmosphere of collaboration and growth within the IoT market, where various factions have committed to working together to create integrated solutions that address the shortcomings of different connectivity technologies. Sigfox is expected to reveal a new strategic direction soon, which may have influenced its decision to forgo participation in the conference.
The focus then shifted predominantly to the LoRaWAN sector. The Things Industries currently serves around 1,500 clients across multiple industries, with its primary offering, The Things Stack — a LoRaWAN network server platform — managing 3.8 million devices across roughly 500 unique solutions. Giezeman noted that the platform handles about 4,000 messages per second. Although the data transmitted is minimal, as these low-power devices generally send only a few messages per hour, the cumulative effect results in a substantial volume of information.
The company’s revenue is reportedly growing at a rate of 30% annually, with recurring income generated from its customer base. Interestingly, the largest customer accounts for no more than 2% of total revenue. While these figures are encouraging, they also highlight that the low-power segment of the IoT market is finally beginning to stabilize. The LoRa Alliance reported a total of 125 million LoRaWAN connections, with significant contributions from various players, including ZENNER, which alone holds ten million connections.
The ongoing discussions at the conference, including insights from Alper Yegin, chair of the LoRa Alliance, will be covered in future reports. The concept of niche markets within the IoT space not only emphasizes the size of the opportunities but also underscores the strategies being employed to capture these potentials. This hard-earned wisdom, gleaned over the past five years, is crucial for the IoT sector, particularly as it navigates the complexities of Industry 4.0. The challenges lie not merely in resolving issues but in understanding how to effectively address them by engaging with specialized enterprise channels, recognizing specific enterprise challenges, and crafting tailored solutions.
The enterprise landscape, especially in operational technology (OT), is intricate and cannot be effectively addressed through generic solutions or off-the-shelf products commonly offered by large mobile operators. The attendees at The Things Conference possess the specialized knowledge necessary to develop effective solutions, or they know how to access such expertise. This specialized approach offers hope for the future, as it indicates that significant opportunities are not only vast but also attainable.
