UK-headquartered floLIVE is different to every other IoT airtime provider out there – the company reckons. This is the case, it says. whether the comparison is with virtual operators (MVNOs) piggybacking on the traditional roaming agreements of their regional sponsors, or with national operators (MNOs) running IoT on rented airtime in foreign markets. This is the whole floLIVE story, as told to RCR Wireless at MWC in Barcelona a couple of weeks back; and the proof of it, it says, is that both specialist MVNOs and generalist MNOs now want to put their IoT traffic onto its system.
But who? Which MNOs? Vodafone and AT&T? China Mobile? Nir Shalom, the company’s founder and chief executive, is not about to spill the beans; except he does, effectively. “I can’t speak for anyone; I can’t speak for my friends,” he responds. “But what I can say, generally, is this: take the top five MNOs in the world for global IoT connectivity – pick the names, excluding Deutsche Telekom – and I can tell you we are engaged with them. At some level, we are engaged; we are at an advanced stage with some, and we are warming up with others. But take the top five.”
The comment about Deutsche Telekom is linked, presumably, to the fact the German carrier is tied up with its country-mate 1NCE, already, which also has Softbank as an investor – and which has established itself as an effective conduit-channel for a chunk of their IoT activities. The floLIVE story says this trend for big national MNOs to divert international IoT airtime traffic via specialist MVNO partners is real, and about to be formalised by the top dogs in the field. Meanwhile, floLIVE’s old MVNO rivals, unnamed by Shalom, are asking for the same, apparently.
So what gives? Why is floLIVE in such demand as a kind of international clearing house for so much cellular IoT traffic? Shalom goes back to the start, to his time at AT&T, where he spent more than a decade in charge of its network applications and product management in Israel – and to the initial spark that brought floLIVE to life. He says: “AT&T is the second largest MNO provider for global IoT. When I was there, we came across certain challenges for customers to use its solutions [globally]. And in the end, that was the basis for floLIVE – to solve real problems in IoT.”
Even the biggest MNOs rely on their peers for global airtime, of course; and the global carrier deals that let everyday customers roam between countries with their cellular devices are not geared originally for IoT – for optimal low-power machine connections, as required, and constant international mobility; or even, actually, for localised fit-and-forget projects that have to last a decade on a marginal data and money flows. For it to work, the core network and business support system have to be perfect, says Shalom – and they are mostly stitched together in a patchwork.
He says: “In principle, every MNO takes these roaming agreements, designed for you and me travelling abroad, and then buys a connectivity management platform from Cisco and a billing system from Amdocs, and stitches it all together, and says, ‘Hey, we have an IoT solution’. And they end up with something that is too expensive, where performance is not good because the roaming is not right, and where the security and data compliance are in the wrong place. So [as operators], you have to find workarounds to solve all these pieces and problems.
That is the AT&T experience, he suggests. So how does an IoT airtime startup solve that – without any kind of radio access network in any country? “We looked at what the global IoT market needs – what global IoT customers need,” responds Shalom. “And to deliver without limitations, as a greenfield company – to just build in a way that solves all of those problems.” He lists the requirements: the best coverage, the best availability, the best performance, plus appropriate security and compliance, and total simplicity – in every single country.
“So how do you build all that? It sounds simple but it is very complex,” he says, pre-empting the next question. “Because if you really want to do it on a global scale, it is a massive project. And so we set three principles – and this is the secret sauce, right? Where each principle is a whole level of differentiation, and where their combination is something that does not exist anywhere else in the market.” Alright; you have your attention. And Shalom shoots, and talks us through the whole pitch – to own the tech stack, make it global, and stay friends with the MNOs in every market.
He hardly pauses for breath, and the next section, outlining these ‘principles’, quotes him in full.
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1 | TECHNOLOGY STACK
“The first principle is to own the entire technology stack. Ours is the only company in the industry – and I include Cisco in this count; with the exception of one company from Germany – that owns all the components to be able to build a global cellular network: a mobile core, from 2G to 5G SA, plus cellular narrowband IoT; a cloud-native billing and rating engine; the provisioning technology in the SIM card; and the connectivity management platform. We wanted to control the technology stack for three reasons.
“One, you need to control your costs. IoT revenues are low, and buying solutions from third parties impacts that. Two, you need to control your roadmap. The IoT market is always evolving, and you have to be able to support new capabilities to support new use cases – which is harder if you are dependent on others. Three, you need some control with the MNOs [to protect your business] – and selling technologies to them, and to anyone, builds relations with them. Other MVNOs have pieces, but none of them have it all; not even Cisco.”
(Actually, as he acknowledges earlier, Germany-based EMnify does “have it all” – its own core network, billing system, and management platform. EMnify is supplying pieces of its MVNO solution to certain other MVNOs, as floLIVE is doing as well. But EMnify is “not a competitor because it targets small and medium businesses”, explains Shalom, and it is not building a “global network”; see below.)
2 | GLOBAL NETWORK
“The second principle is to build a global network, which means integrating with MNOs in different countries, and making their coverage simple to use on our platform. Because coverage from a single MNO, any MNO, is not enough. So we put local [core] networks in the US, Brazil, Australia, the UK – all over – and integrated with local MNOs, and stitched it together. So instead of separate networks, we [mesh them all] in a single global network. Whereas a local MNO, or a global MVNO using a local MNO, has a local core network connecting to a local radio network – and that’s it.
“Whereas we have a global core network [localised in every region] that roams onto their local radio access networks, wherever they are. We are taking advantage of MNO assets, and connecting them together for superior coverage and availability. And by doing that, we solve many of the issues with IoT – so a device in Australia is served in Australia, on an 80-second round-trip, instead of going back to [a host-MNO’s core network in] the US, say, on a 600-millisecond trip. And so the use case works properly.”
3 | PLAYING NICE
“The third principle is that the MNOs are your best friends. If you are an MVNO, you can only grow as much as your MNO sponsor lets you. Once you cross the line… Every MVNO is captive to their MNO suppliers. If they do not like what you do, then they can increase the price – in the best case scenario. In the worst, they will just stop service, and potentially kill you. There are precedents. We will not be in that position. We want to guarantee that what we deliver to customers will be consistent and long term. So we did something different.
“Because we own the technology, we can say to the MNOs, ‘look, you’re using legacy tech from Cisco, Ericsson, Aeris, whatever; it is costly, it doesn’t scale, and it is not global. Use our stack, and get the benefits; we use you, and you use us’. It is reciprocal. One MNO, for example, is now stacking half a million electricity meters on our platform, and we are using their coverage. Let’s say, just for argument’s sake, that one day they don’t like the way we are selling the coverage. Can they shut me down? They can’t. Because we can shut down half a million electric meters.”
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The point is to “be careful with floLIVE”, he says; the company has developed a proposition that solves some of the gnarly eternal challenges of global IoT, which holds certain value, marginal but also scalable, including for network operators themselves. The example Shalom gives above, about in-market electricity meters, seems curious; it makes sense, perhaps, that an MNO would choose an MVNO, with an integrated global technology stack, to serve international clients, but why should it choose floLIVE for its local services, where it has its own core and radio networks?
He responds: “Because the price-point and feature-set do not exist in other stacks. We build everything with cloud-native technology, from scratch. These are not legacy systems, so you don’t need to bill for five million from the get-go like with others. It scales dynamically in the cloud. So the marginal unit cost is very, very low – down to fractions of cents. And for meters, it is 10 cents per month [in revenue], so you need to be very careful with your costs. Plus, these big national meter deployments, for a half million households, often require coverage from more than one MNO.
“In this case, they could not be connected just with the MNO they signed with. And maybe it is harder for them to work with competitors – whereas we work with them already. We sell one MNO the coverage of another, and everyone is happy. No one else is doing it; no one is exchanging MNO assets between MNOs in a centralised hub. And every MNO that joins our network makes it better. And now MVNOs are knocking. Because their solutions are only as good as Deutsche Telekom’s roaming agreements, say. Whereas we can offer them 15 Deutsche Telekoms.”
At what point does AT&T come to you, or Vodafone, or any one of the big established IoT MNOs? “They already are,” responds Shalom, and gets into the conversation at the top of the piece. Who? “The top five in the world,” he says. Its footprint features are down to its investments, he makes clear. “How many companies in this industry are really investing good investor money in building technologies for cellular IoT? Not so many.” He references Cisco’s investment in Jasper and Aeris’ investment in Ericsson’s IoT Accelerator business.
He goes on: “Companies are not investing to build future-looking capabilities into their cellular core networks – and it is needed. So MVNOs are coming to us because we are a multi-MNO solution, and not a single MNO solution, and we have superior technology, better costs, and we are globally distributed. We have dozens and dozens of MVNOs as customers. You don’t even know floLIVE is the engine behind them because it is a completely white-label arrangement. Today we met with MNOs and MVNOs; we signed a couple of deals today. But there won’t be a press release.”
