How IoT faded when net neutrality became ‘pay to play’

Free at last, free at last. Thank God Almighty carriers are free (to rule) at last.

It’s 2020, and the Internet of Things (IoT) is in decline. What happened? People whisper that it started in 2017 when net neutrality was killed.

In the spirit of George Orwell’s Animal Farm, here’s what may unfold if net neutrality becomes "pay to play."

Loss of net neutrality: The beginning

The regulations were changed with the promise of providing "better" internet access. Internet carriers were given free rein to charge what they liked for traffic on their networks. “Free at last, free at last. Thank God Almighty carriers are free to rule at last,” exclaimed Bill Paider, a fictional carrier executive paraphrasing Martin Luther King Jr. "We've even published a Carrier Code of Conduct to guide our improved public service!"

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Change is in the air

The new regulations split the IoT industry into the haves and the have-nots. Larger IoT firms flourished, as they could pay the higher access fees to connect their sensors to the cloud. Startups that couldn’t afford the higher fees struggled to survive. VC funding to new IoT startups dried to a trickle. Sales of the carrier’s own IoT services soared because they didn’t have to pay the higher access fees. IoT services from large firms became "more" equal

It’s all for the public good ...

“We have a new mandatory certification process for IoT devices that connect to our network. The $54,000 certification fee is for the public good and barely covers our costs,” explained Paider. “Rumors that certifications take eight months just aren’t true. Often we do them in seven months.” 

IoT devices can still connect to the network, but they have to be carrier-certified first. The long lead times and high costs for IoT device certification slowed down the rate of innovation. On the plus side, certification has become a lucrative profit center for the carriers.

“IoT sensor data often clogs our networks, slowing down more profitable traffic such as voice calls. We’ve introduced a tiered quality-of-service to resolve this,” added Paider. “High volume, low margin sensor traffic gets less network priority unless a surcharge is paid. Our intent isn’t to degrade IoT services, just allocate network bandwidth so as to maximize revenue.” 

Health-monitoring applications that produce a high volume of sensor data were the first to suffer. Their popularity declined as sensor readings became less dependable due to higher network latency and increased packet loss. IoT-based predictive maintenance and security monitoring services were the next to fade. In theory, network traffic was still treated fairly by the carriers, but in practice, traffic from profitable applications was treated more fairly. 

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The only game in town

Cellular internet access wasn’t the only way to connect IoT devices to the cloud. Firms offering radio signal-based access (such as LoRaWAN and Sigfox) began to decline in 2019 when their cost for cellular backhaul was tripled by the carriers. Soon cellular access became practically the only game in town to remotely connect IoT devices. A few small radio signal-based IoT projects do survive in remote mining towns. All forms of IoT device access are good, but cellular was best!

“It’s only fair that valuable IoT services such as security alerts pay higher usage fees for network access,” justified Paider. “It’s not that the applications require a lot of bandwidth. It’s about the value of the information their network packets contain. This is not price gouging!

The major IoT services "voluntarily" entered into revenue-sharing agreements with carriers. Revenues declined, and layoffs followed. Fortunately, many of the laid-off IoT developers were able to find work at the now extremely profitable carriers.

The carriers' own IoT cloud-based management services boomed. IoT startups were offered lower internet access rates to adopt the carrier’s management platform. The free market still ruled, but internet access prices for startups using competing IoT management platforms began to rise.

IoT services in rural areas and small towns disappeared once the major carriers realized it was much more profitable for them to invest in increasing their infrastructure in the bigger cities.

“We just don’t see a lot of demand for IoT services from rural areas, so we're not adding any more network capacity there. IoT devices everywhere do have internet access everywhere—just as long as they are in a big city,” commented Paider (paraphrasing Henry Ford). Paider, as you can tell by now, loves paraphrasing. 

Feedback welcome

IoT firms and consumers complained, but they still needed connectivity to organize and protest. Complaints against unfair access soon faded as carriers raised the internet access fees for the protestors. 

“This isn’t a freedom of speech issue,” said Paider. “People are welcome to complain, but first they have to pay us for access to get their voices heard online. We’ve clarified this in our new Code of Conduct”.

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There's still time to act on net neutrality

It isn’t 2020 yet, and this bleak scenario might still be stopped. But the window for submitting feedback is closing fast. Make your voices heard now!

Copyright © 2017 IDG Communications, Inc.

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