HK's IoT ecosystem is growing

Nancy Ng / Computerworld Hong Kong
08 Jan 2018
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Internet of things (IoT) is growing in depth and breadth in Hong Kong in 2017. More low-power WAN (LPWAN) IoT networks like NB-IoT, LoRaWAN and Sigfox are being rolled out locally.

Industry analysts and IoT service providers are seeing increased IoT adoption in the city.

“Overall, government and large enterprises are ahead of the SMBs in adopting IoT,” said Tracy Tsai, research vice president at Gartner. “Business model, operation efficiency or new revenue are factors driving businesses to adopt IoT.”

As one of the active IoT players, CSL Mobile noted the government and more enterprises are putting IoT at the top of their agenda.

“IoT begins to take greater shape in 2017,” said Natalie Chan, vice president of corporate marketing, commercial group at CSL. “Vertical applications from various industries have emerged, enabling enterprises to have more insights on deployment.”

Chan said the government’s investment in smart city is “a good start and important driver to expedite the adoption of IoT in Hong Kong”.

The Hong Kong SAR Government is committed to putting forward the use of IoT in its smart city blueprint. During the Policy Address 2017, Chief Executive Carrie Lam pledged to push ahead smart city development with an investment of HK$700 million. One of these projects is the pilot scheme of multi-functional smart lamp posts to support city-wide and network coverage.

In 2017, the local market has seen greater demand for industrial IoT and business applications. They were deployed for smart manufacturing, property and fleet management.

“Broadly speaking, connected automotive remains the largest vertical in terms of supply and demand,” Tsai noted.

“IoT in property management and fleet management are more active,” Chan said. “Connected sensors are used to detect and control air quality and [home] appliance efficiency to improve energy consumption and security.”

With a growing number of IoT devices in place, data volumes generated from those devices are expected to grow exponentially. More companies are struggling to manage the influx of data and traffic, and gain value from data to benefit their businesses.

“One of the trends we are starting to see is that some IoT project owners aren’t prepared for the tremendous volume of data, so their projects tend to fail,” said Shashi Gowda, advisor, management consulting KPMG China. At the StartmeupHK Festival earlier last year he said “we see some IoT projects start as POC and move to another POC but were never really rolled out.”

“Most Hong Kong companies are facing data overload,” added Guy Freeman, founder of data science consultancy dataguru.hk. “I don’t just mean they can’t handle the massive amounts of data from IoT devices, but even their management of traditional operational data is sub-optimal, not taking advantage of the latest technology and processes to improve their business efficiency or customer-centricity.”

Building network infrastructure for the future

IoT is not simply connecting devices and sensors. It leans on network infrastructure to support enterprises to take advantage of the collected data and develop actionable insights.

“It depends on applications, data content and business nature when enterprises develop their network architecture,” said Tsai from Gartner. “They could consider either on-premise or cloud infrastructure depending on response time, user experiences, security or content access type.”

CSL noted a reliable and enterprise-grade network with security capability is key to the success of IoT investment.

“Local enterprises are looking for hassle-free IoT solutions. A reliable and enterprise-grade network is essential,” said Chan from CSL. “As IoT devices are increasingly vulnerable to security threats, security at every layer should also be considered.”

According to Chan, CSL has built an IoT infrastructure offering under its premium brand 1O1O in 2017. Equipped with cyber security capability, the IoT infrastructure offering consists of four areas including enterprise-grade network connectivity, sensors, management platforms, applications and analytics.

On the network connectivity side, CSL runs 2G / 3G / 4G mobile networks and supports the fixed network of its parent company HKT Group. She said CSL is ready to launch LPWAN based IoT networks—NB-IoT and LTE-M, and also has the capability to deploy LoRaWAN. NB-IoT and LTE-M are operating in a licensed spectrum whereas LoRaWAN uses an unlicensed spectrum.

“We recommend NB-IoT and LTE-M as they are licensed bands on a mobile network,” Chan said. “In term of protocols’ continuity and commonality, they will be the first choice of LPWAN engagement for most of the mobile operators.”

On the sensor front, CSL collaborates with local and global partners to provide different forms of sensors. In addition, the mobile operator also provides management platforms to handle device, SIM and user administration.

She added that CSL is providing different IoT applications to address specific industry needs. The mobile operator also provides cyber security, consultancy and deployment services.

For enterprises looking into IoT initiatives, their most frequent question is “where should I start?” Both Gartner and CSL suggested that they should start small.

“They could start with small projects with measurable business outcomes before launching larger deployments,” said Tsai from Gartner.

“The first step is to assist enterprise customers to define the business outcomes and objectives that they want to achieve with IoT,” said Chan from CSL. “We usually encourage customers to start small scale and extend to a bigger scale step by step.”

Continuous growth in 2018

Moving forward, IoT is expected to drive growth in 2018 in terms of installed base and technology spending, according to the industry analyst.

“In Asia, including Japan and China, the total installed base units will be 4.46 billion in 2018,” Tsai said.

Market research firm IDC also forecasts the total IoT spending In Hong Kong to reach US$1.85 billion by 2020.

“2018 is a year full of IoT opportunities with an increase in market awareness, the number of vertical solutions and industry players in the ecosystem,” added Chan from CSL.

Chan said the top three IoT applications in 2018 are likely to be asset tracking, fleet management and surveillance. As more enterprises realizing the benefits of IoT applications, she said they are expected to expand their deployment and types of applications.

First published in Computerworld Hong Kong

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