Qualcomm Lights Up New IoT Approach

Bold plug-and-play move attempts to speed smart city adoption

Late in 2020, Qualcomm reviewed its approach to the Internet of things (IoT). It started to disclose revenue from the IoT segment in a supplementary report from its chipset division. It also briefed analysts about new aspects of its IoT strategy as well as an important launch from its Smart Cities Accelerator Program. Although it had a lower-profile launch than other Qualcomm products, the smart cities move is a significant one for the market and the company.

For a couple of years before this strategy review, Qualcomm saw IoT as an adjacent market to its cellular modems and chipset business. There was clearly potential for the company to be a major player in the overall IoT picture, but its position was mostly just as a component supplier. Its IoT strategy was rather technology-led, skewed toward connectivity, and its message was often drowned out by Qualcomm’s 5G marketing — even though 5G is of low relevance in most parts of IoT so far.

The new IoT revenue line is still closer to “Other” than to pure IoT. It mixes up a broad swathe of products: Bluetooth chips in TV sound bars alongside industrial hand-held devices, fixed wireless broadband, wireless networking, robotics modules, surveillance camera modules and other IoT uses. However, what purists would call “real IoT” is clearly a significant part of this line and has been brought together under the leadership of Jeff Lorbeck.

Importantly, Qualcomm is now much more realistic about the market for real IoT, about its position in this landscape and about what customers need. It clearly recognizes that connectivity is a central part of the story, but that it also has really important strengths in power-efficient processors, artificial intelligence and security. Crucially, Qualcomm now talks clearly about the need, as a component supplier, to have a role in overall IoT systems architectures and about taking a central role in an ecosystem of partners.

Qualcomm’s new approach shows an understanding that although the technology is important, IoT is just one part of a much bigger digital transformation picture. What customers need is the data to enable them to analyse and optimize their business in new ways, and IoT on its own is no more than a way to get that data.

Together these aspects mean that Qualcomm’s IoT strategy has moved beyond just a technology-led play. It has a much stronger focus on improving how the company works to develop solutions, how it goes to market and how it works with other players on these efforts.

This path was arguably first shown by Qualcomm’s smart cities group, which has taken its own different approach over a few years under the leadership of Sanjeet Pandit. Through its events and Smart Cities Accelerator Program, launched in April 2019, it has put a stronger emphasis on working with other companies, creating the right architecture, and on solutions rather than components.

The Smart Cities Accelerator Program now has close to 300 members and assembles solutions for specific uses with the help of Qualcomm’s partners. One member, Infinite Computer Solutions, provides support for the platform layer of these solutions with its Zyter SmartSpaces offering.

Having completed its IoT strategy review, Qualcomm’s smart cities group is moving on to a next phase of its own development. The first aspect of this journey is to position itself for serving smart spaces rather than only smart cities. This subtle shift opens up the addressable market to include shopping malls, museums, airports, schools, universities business campuses and so on, rather than just cities or municipal authority systems.

The second aspect of this phase is the important launch in early December 2020 of Qualcomm’s IoT Services Suite. This takes some of the solutions that it has created and makes them available to customers as a service. So far it includes:

• Smart cities and spaces as a service: for smart lighting, signage and parking
• Education as a service: for technologies serving classrooms and hybrid learning settings
• Construction management as a service: for safety and digitalization of construction sites
• Logistics as a service: for digital management of a whole logistics chain
• Healthcare as a service: for remote patient monitoring and tele-ICU services

From the market’s point of view, this as-a-service move is interesting because it removes some of the barriers and it changes the risk profile of smart city projects: customers no longer need to make a case for capital expenditure, with the associated technology risk of building a system. Instead, customers will gain the system through operating expenditure.

It’s also an interesting move for Qualcomm, as the company isn’t known for taking the full technical and development risk with large-scale solutions. Qualcomm has also not supplied systems as a service at any scale since its old days with the Omnitracs fleet tracking network in the late 1980s.

Qualcomm also launched its Smart Campus in San Diego, which showcases a series of smart building and other systems from partners, installed in and around its office buildings. This includes a private 5G network, smart parking, lighting, transportation, logistics, litter bins, and security monitoring using cameras with artificial intelligence and edge computing capabilities. The system includes user applications and a control centre providing a complete real-time view of the whole network of connected sensors.

These are all good efforts, but they don’t mean that Qualcomm should expect overnight success in the market, for three main reasons. Firstly, it will take considerable time and effort to build a large ecosystem of partners around the world, and for that to be recognized and trusted by customers in the market.

Secondly, although Qualcomm has made a good start in this area with its smart city solutions, it will take time to build up a broad range of fully architected and engineered systems that are available for sale, as Intel has done with its Market Ready Solutions over the past three years.

Thirdly, Qualcomm’s as-a-service model for the new smart cities solutions removes some of the difficulties customers face, but there are several other factors determining the pace of adoption. They include existing long-term outsourcing contracts, existing supplier relationships, staff skills, political imperatives and organizations rethinking the way they do things as the world starts to emerge from the Covid-19 pandemic.

In my view, it’s refreshing to see Qualcomm shifting its stance in IoT like this. The company has always had strong and useful technology relevant for IoT, and it’s now in a much better position to play a major role in the development of the commercial IoT market.