on January 23, 2020
In a recent appearance on The Joe Rogan Experience, Elon Musk puffed some bubonic chronic (much to the chagrin of those stuffy Tesla shareholders) and waxed poetic about how he has millions of ideas, but spends 80% of his time dealing with engineering and manufacturing. As every successful entrepreneur will tell you, everything comes down to execution. That’s why communications companies around the globe ought to be watching the progress of Starlink, a 30,000 satellite constellation being deployed by Mr. Musk that is predicted to unlock trillions in economic value by enabling the global Internet we’ve all been waiting for. In our recent piece on The Global Impact of Cheap Satellites and Launches, we talked about how SpaceX is ready to become an internet service provider that may soon challenge the world’s biggest tech companies by offering everyone around the globe dirt-cheap internet access. And one problem that may solve is the Internet of Things (IoT) connectivity problem.
One promise of IoT is that, eventually, everything has a digital twin that lives up in the cloud. Once you have successfully mimicked the real world in the virtual world, you can then begin optimizing things using machine learning algorithms. Think about how many traveling salesman problems there are to solve in the global food supply chain that could eliminate food waste, reduce transportation costs, and generally just make the world a better place. Just one thing seems to stand in the way of this ideal world. It’s called the IoT connectivity problem, and it refers to the difficulty in getting a bunch of devices out there to talk to the cloud from anywhere at a reasonable cost. One company trying to solve this problem is Hologram.
The SIM Card Problem
If you spend a lot of time going to faraway places in the world – like the Caucasus – looking for interesting technology companies, you’ll quickly start to accumulate lots of SIM cards. That’s because the first thing you should do when arriving in a new country is to get a SIM card with data so that you can then use WhatsApp to communicate with your friends and family, Uber to get around, Airbnb to arrange lodging, and Tinder to find a new mistress.
Every one of the 196 countries on this planet has one or more cellular carriers, with one or more plans, and one or more ways to screw you over. Even in developed markets, you can get absolutely effed if you happen to switch mobile data on in some foreign country where Hong Kong carrier 3HK doesn’t get along with foreign dictator-run carrier. If only you could get one SIM card that worked anywhere around the world that automatically figured out which path to take which would be least likely to empty your wallet. Now, you can.
Founded in 2013, Chicago-based Hologram has taken in $11.1 million in funding to develop “a connectivity enablement toolkit that empowers makers, engineers, and creators of all types to connect their devices with wireless data as well as manage billings as they grow.” In order to understand how the solution works, we first need to understand that various IoT connectivity solutions are appropriate for various uses cases. For example, cellular networks are a great connectivity solution for use cases that require lots of range and bandwidth, and where electricity usage isn’t an issue. Smartphones are a prime example of such a use case. They’re IoT devices we glue to our faces and travel with through different countries using cellular networks for connectivity.
Imagine that you had a fleet of delivery vans traveling throughout Europe which were all equipped with a fleet tracking solution. There’s not a Romanian truck driver out there that would agree to switch SIM cards in your tracking devices every time they cross a border. That’s where you might consider a Hologram SIM card which allows your drivers to seamlessly travel between any country while you enjoy the same standard rate.
When it comes to pricing, there’s a fixed cost (an active device charge billed on a 30-day cycle from the day the SIM is activated) and a variable cost (data is billed by the kilobyte). Sending an SMS will cost about 19 cents (does anyone even do that anymore?). There are also custom pricing plans based on whatever stage of IoT deployment you happen to be in.
Custom pricing from Hologram – Credit: Hologram
Change, pause, or cancel plans at anytime using their easy to use console or through an API. Their SIM supports 2G, 3G, 4G LTE, CAT-M, and eSIM technology. SIMs ship globally within 3 days allowing you to get connected within a week. These IoT SIMs are hardware-agnostic and will work with any unlocked cellular hardware in every country in the world. Your entire collection of devices can be controlled and monitored from a single dashboard that provides detail around data usage at varying levels of analysis.
A Hologram dashboard – Credit: Hologram
Thousands of companies around the globe are using the Hologram cellular platform for IoT devices including names like Amazon and UPS. Given that Holgoram’s last funding round was three years ago, they just might be cash flow positive now. After all, they’re mainly a software company, though they do offer a piece of hardware as well – a $64 cellular modem.
A Hologram global cellular modem – Credit: Hologram
The above device lets you send and receive messages perfectly with a Raspberry Pi, BeagleBone, or other single-board Linux computer. Hologram’s system then allows you to connect to over 85% of the area on planet earth in just weeks. In one example they gave, a client went from idea to 10,000 bikes launched in five cities on three continents in just two months.
Starlink and Skylo
The first thing we thought when reading about this business model is how the likes of SpaceX might disrupt it. When Elon Musk has his 30,000 satellite constellation up in the sky blocking everyone’s telescopes, won’t it be simple enough for him to just beam down some IoT connectivity to the masses along with unlimited cat videos? Not necessarily. As we mentioned earlier, it’s the cellular infrastructure that makes Hologram’s IoT solution offer such high bandwidth and high range. As 5G emerges, that bandwidth will increase tremendously opening up a wealth of new use cases. There are many ways to achieve IoT connectivity, and not all are created equal.
One example of a satellite-enabled IoT connectivity solution is Skylo, a startup backed by SoftBank that came out of stealth mode a few days ago purporting to “affordably connect the Internet of Things to satellite networks.” Says the company, “Our geostationary satellite architecture, the world’s first NB-IoT network directly over satellite, provides instant, two-way connectivity with the highest reliability.” An article by TechCrunch talks about the Skylo Hub, “a satellite terminal that connects to its network on board geostationary satellites, acting as a hot-spot to make that available to standard IoT sensors and devices. It’s roughly 8″ by 8″, can be powered internally via battery or plugged in, and is easy for customers to install on their own without any special expertise.”
A Skylo IoT Hub – Credit: Skylo
Right away, you can see how Skylo’s solution appeals to very different use cases. In other words, various IoT connectivity methods address various use cases, and there’s enough room in the sandbox right now for both Skylo and Hologram or any of the other half a dozen companies out there trying to offer IoT connectivity – expect for perhaps Helium, because their not-so-compelling business model (at least last time we checked) relies on people purchasing $495 devices and earning cryptocurrency by providing other with IoT access.
Unfortunately, this SIM isn’t being offered to travelers as a solution to the “many SIM problem” since Hologram has much bigger fish to fry. Over 2,000 companies are now using this solution for IoT devices. Now that the infrastructure is in place, it’s easy enough to continue adding customers without increasing fixed costs. Additional IoT connectivity solutions will continue to emerge and traction is more important than anything since companies will incur switching costs once they’ve decided to adopt any one technology. Once Elon Musk dominates the globe with Starlink satellites, he’ll have plenty of cash to acquire all the startups out there addressing niche use cases so he can then move on to solving the next big problem – IoT connectivity on Mars.
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