SigFox sees upcoming launch of 5G services disrupting its IoT market

Although 5G services will have faster throughputs, it will nevertheless cost billions of euros for each national market compared with a few million for Sigfox’s IoT networks. The smart thing would be to mix and match to get the best mileage out of both technologies.

SigFox, a French start-up which builds networks to make everyday devices IoT compatible, disclosed it is struggling to meet growth targets because of high expectations from the upcoming launch of 5G services.

Ludovic Le Moan, SigFox’s CEO stated, although the startup, whose shareholders includes Salesforce.com and French oil major Total, missed its revenue target, it aims to break even in the fourth quarter of this year and still sees good prospects for the firm.

Once it reaches its target, it could come out with an IPO, said Le Moan in an interview to Reuters.

The startup faces tough competition in the Internet of Things (IoT) sector from two of its peers NB-IoT, a startup which has the backing of Softbank and LoRa, which is backed by Cisco Systems and French telecom operator Orange.

The technologies that SigFox and its peers are enabling provide devices to transfer small volumes of data over a wide area with minimum impact to battery life, 5G services will be able to carry much bigger volumes and will have a significantly bigger asking price.

“There’s a lot of noise around 5G these days,” said Le Moan “But these technologies that are being put in place are much more costly,” he added. “For telecom players, this is all about generating new revenue.”

The first standards for 5G, have been recently approved with the first commercial offers expected to reach the market in 2019 or 2020.

When 5G rolls out, it will cost billions of euros for each national market, compared with a few million for Sigfox’s IoT networks, said Le Moan.

Significantly, higher volume usage of IoT chips, including those made by Texas Instruments or STMicroelectronics, will help drive down costs to a few cents per unit, thus making the technology more attractive, said Le Moan.

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