Jola Cloud Solutions' Blog

New hardware for FTTP and 5G

We are seeing significant demand for single devices that support Gigabit Ethernet and 5G or for 5G devices that can sit alongside Gigabit Ethernet routers.  Internet connectivity is now mission critical to virtually all businesses whether they are SMEs, mid-sized or the largest of enterprise or public sector.  For the channel, these devices need to be robust, reliable and manageable out of the box.  At Jola, every single device that we supply includes unique software that we’ve developed in-house to make the device provisioning zero-touch and to enhance the remote support that the reseller can provide.  Supplying hardware isn’t just a case of shifting a box anymore, now the reseller needs to make sure it will work perfectly with the customer’s particular mix of connectivity as well as any wide-area network-specific requirements such as SD-WAN or VPN connectivity to other locations.  

Benefits

The latest generation of equipment is significantly more powerful than what’s gone before.  Two years ago, using the best external antennas, a typical cellular router, even from a premium brand, would struggle to perform much beyond 40Mbit/s.  The constraint was both the device itself but also the cellular service available.  In a recent test, our entry-level 5G router, inside a building, using its internal antenna delivered 490Mbit/s.

The other major benefit of the new equipment is the cost savings.  Our average leased line customer has 100Mbit/s of bandwidth but our average FTTP customer has 300Mbit/s available to them.  On average our 5G customers achieve speeds of 276Mbit/s (using the Three UK network).  FTTP is around 80% cheaper than a leased line and 5G is around 97% cheaper than a leased line!

The digitisation of healthcare has had a major impact on IT and telecommunications requirements. In recent years there has been a huge effort within NHS trusts to move to 100% electronic patient records which are more easily accessible.

Demand

The demand for mobile connectivity services and devices has been increasing consistently since the start of COVID. During the pandemic, there was a need for healthcare professionals in the field to be able to work remotely rather than return to a GP practice or hospital at the end of each shift to update records.  However, that simple change has now led to those mobile devices being used for so much more than simple data entry. Now that single device and SIM card will be likely used for video calling, collaboration, lone worker safety and access to the latest reference material and procedures.

Given that this mobile access is now so mission critical and in some cases life critical then it is no surprise that we seeing more and more demand for data and voice SIMs that can roam un-steered on all the UK networks providing better coverage and resilience than any traditional SIM from one of the big four mobile operators.  

Security

When you’re dealing with an individual’s health information, cybersecurity is a top priority.  With internet-based health applications, this is usually addressed with application layer encryption.  However, where the application isn’t hosted on the Internet but is hosted within an NHS Trust's data centre or cloud then it is very common for a private APN to be required.  A private APN works using standard SIMs and devices but instead of providing access to the Internet, it provides secure access between the SIM and the application without requiring the traffic to traverse the Internet at all.  Private APNs used to be the sole preserve of the mobile operators, but now our resellers can set these up in a matter of days and choose from a variety of different tariffs that provide support for single or multiple mobile networks.

Three years ago we were involved in a project to connect over 30,000 ambulances to the Internet to be able to access electronic patient records which has been a tremendous success.  However, now the requirements have moved on significantly from just being patient records.  The mobile connectivity we supply is now being used to replace the traditional 2-way radio voice communication using either cellular voice or PTT over IP technology.  The largest increase in data usage is coming from video calling which is being used to connect patients, control centres and paramedics to improve the speed and quality of clinical decision making.

A more recent initiative is the concept of ‘virtual wards’. Jola is involved in several different projects of this type throughout the UK with several different partners.  A virtual ward is a term used to describe how digital technology can be used by a hospital to communicate with and monitor the health of hundreds or thousands of patients.  Typically the patient will have a device such as an iPad with a SIM card in it that is linked to wearable sensors that monitor things such as heart rate, blood pressure, body temperature and environmental conditions.  The data is then combined with virtual or in-person outpatient visits that can give the patient more choices about their care and free up valuable hospital beds.

Your customers are working on mobile data projects right now and demand is predicted to increase dramatically over the next few years, writes Adrian Sunderland, CEO at Jola. If you get it right with M2M and IoT, you will quickly generate high-margin recurring revenue and, due to higher EBITDA multiples, increase the value of your company.

According to McKinsey, revenues from mobile data are set to increase dramatically over the next five years due to the availability, speed and reliability of 4G, 5G and IoT. Statista forecasts that there will be over 25.4 billion IoT devices worldwide in 2030. Fortune Business Insights predict this market will be worth £1085bn by 2027.

People think IoT is low revenue and you’ve got to win hundreds of thousands. You don’t. You can often get a decent ARPU of £10 to £15 on thousands of devices and sometimes margins of more than 40%, so it’s an attractive line of business to pivot into.

Your mobile data partner will need to give you the tools to win deals, usually competing with the direct sales arms of the mobile networks. Your supplier will need to be an aggregator with access to all the networks and ideally, they will also be an independent MVNO. Most importantly everything must be automated, with real-time APIs offering zero-touch provisioning and management through a single self-service portal.

They will need to be innovative, with a constant stream of relevant mobile data and IoT products
that the networks would take years to develop and launch. When you partner with the right channel supplier, mobile data is easy to sell, support and bill.

The opportunity for the channel is significant. ICT resellers already have strong relationships with business customers for IT infrastructure, asset tracking, digital signage, mobile WiFi, monitoring and utilities.

Mobile data is an easy product to sell and provision and needs very little support. Jola took on just over 200 new partners in 2022 and now has over 1300. We put 30,000 multinetwork SIMs into iPads for one public sector project, with a very quick book-to-bill timeframe and no issues. Our SIMs are in devices such as ANPR cameras, CCTV cameras, vending machines, digital signs and tracking devices around the world.

This has been true for UK resellers since deregulation in the early 1980s through the launch of the first competing telephone service to BT in 1986, fax, telex, ISDN, 21CN and now the transition of everything to IP. At the same time, the constant need for more speed drives another fibre revolution creating a plethora of local, regional and national fibre companies. Similar to what happened to cable companies in the 1990s these will inevitably consolidate into a handful of national providers. Most will get bought and some will go bust.

This move to full-fibre brings challenges as well as opportunities. BT has led the way with its ‘unbreakable’ proposition and for ISPs to compete it must develop its own Layer 2 4G/5G proposition. Unless they decide to build their own mobile infrastructure, this requires network integration with a mobile data aggregator. Neither solution is technically trivial and ISPs need to be careful to evaluate the technical competence of potential suppliers before deciding which way to go.

The networks are already switching off their 3G networks and there are thousands of routers out there that need to be replaced to work with LTE. This is a great opportunity for MSPs, many of whom are unaware that their customers are using mobile data already. A channel-only aggregator will use their experience to help you find and replace these with high-margin, high-value alternatives.

Finally, the move to all-IP is bad news for customers of the millions of single telephone lines servicing lift lines, retail, alarm lines and healthcare services. Rather than pay twice the monthly rental for a SOGEA service they are choosing to use tailored 4G/5G products. Apart from hitting the price point, these get around logistical issues like laying cable across third-party space.

We can expect a huge amount of opportunity for the channel. Successful resellers are trusted by their customers, they are more than just suppliers they are advisors. For the SME business, they are perhaps faced with some uncertainty, such as what happens with my PSTN lines and the things connected to them.  The reseller that takes away the uncertainty is in the driving seat to help their customer benefit from the new connectivity as well as solve some of the more niche PSTN replacement problems that are being ignored by the large telcos.

Is the future of connectivity fixed-first, mobile-first, or something in between?

I think the future of connectivity is definitely something in between. There is no doubt that a business that is on-net with one of the fibre providers will want to take their primary connectivity that way.  For them, this connectivity will almost certainly be mission-critical. So, for fibre-connected customers, more and more we see a growing requirement for cellular (4G/5G) backup. Many of the fibre providers are including this as standard with their B2B offerings, providing seamless failover between fixed-line and mobile. 

Of course, not every business is on-net for fibre and so we’re seeing more and more sites where resellers are choosing a mobile broadband solution. According to Ofcom, 73% of homes could benefit from gigabit broadband at the end of last year compared to 82% that could get 5G.  I think that whilst both footprints will continue to grow, in all likelihood 5G will always be the technology used to fill the gaps or provide connectivity where the requirement is temporary (such as construction sites, festivals etc.) or mobile (such as public transport, marine etc.).

The average speed achieved by Three UK’s 5G customers was 275Mbit/s last quarter with the highest performance measured at 1.4Gbit/s!  So there isn’t necessarily a performance compromise to be made through the use of mobile vs. fixed like there was when 3G was the best service available.

We are seeing significant demand for single devices that support Gigabit Ethernet and 5G or for 5G devices that can sit alongside Gigabit Ethernet routers.  Internet connectivity is now mission critical to virtually all businesses whether they are SMEs, mid-sized or the largest of enterprise or public sector.  For the channel, these devices need to be robust, reliable and manageable out of the box.  At Jola, every single device that we supply includes unique software that we’ve developed in-house to make the device provisioning zero-touch and to enhance the remote support that the reseller can provide.  Supplying hardware isn’t just a case of shifting a box anymore, now the reseller needs to make sure it will work perfectly with the customer’s particular mix of connectivity as well as any wide-area network-specific requirements such as SD-WAN or VPN connectivity to other locations.  

The latest generation of equipment is significantly more powerful than what’s gone before.  Two years ago, using the best external antennas, a typical cellular router, even from a premium brand, would struggle to perform much beyond 40Mbit/s.  The constraint was both the device itself but also the cellular service available.  In a recent test, our entry-level 5G router, inside a building, using its own internal antennas delivered 490Mbit/s.

The other major benefit of the new equipment is the cost savings.  Our average leased line customer has 100Mbit/s of bandwidth but our average FTTP customer has 300Mbit/s available to them.  On average our 5G customers achieve speeds of 276Mbit/s (using the Three UK network).  FTTP is around 80% cheaper than a leased line and 5G is around 97% cheaper than a leased line!

Social Housing

Jola supplies MSPs with mobile data solutions to monitor and control the usage of gas and electric systems in social housing. Usage is monitored to try and create efficiencies and move towards a carbon-neutral goal. The challenge their customers have is one of affordability. Hardware costs are high as is deployment countrywide with single network coverage issues.

Hardware

End-users expect always-on 24/7/365 internet connectivity and reliable hardware to be able to monitor usage in near real-time. They don’t want to be paying over the odds for data usage and would prefer to pay monthly for hardware.

Partners can work with end-user businesses to meet the unique connectivity requirements of their customers, helping to test and roll out solutions which exactly meet their needs.

Trends

In the upcoming year, businesses are expected to focus on several trends in the analytics space. Automated analytics is set to increase allowing businesses to quickly analyse data and to generate insights without manual analysis. Machine learning algorithms are predicted to be used more widely to help with decision-making. There will be a greater emphasis on data security. Real-time analytics will be a major focus and there will be a shift towards hybrid cloud analytics as businesses look to gain competitive advantage and retain security over their data.

It is clear that Covid has changed the workplace forever and beneficiaries have been the UC and collaboration solutions such as Microsoft Teams, Zoom and WebEx.  In most workplaces, the option didn’t exist to regularly work remotely and as a result, companies didn’t necessarily provide UC and collaboration tools required.  Covid changed all that and remote working became mandatory for most of us.  At first, we used the tools to simply have multi-person video calls, but quickly started sharing screens and in many cases moved to mass participation web conferences. 

In the past, it was the PBX or hosted PBX providers that were providing UC add-ons to their basic service sometimes at a significant premium.  Now it is the collaboration vendors that, with the addition of PSTN calling, are now displacing the PBX and/or hosted PBX.  It is now relatively easy to port a UK PSTN number to an MS Teams user and use that single client (desktop and mobile) to be able to interact using the rich Teams experience or make and receive traditional voice calls as required.

At the moment the UC collaboration experience is all based on two dimensions video and screen sharing.  However, we already see our SIMs being used in Augmented Reality (AR) and Virtual Reality (VR) applications in specialist industries with purpose-built tools and devices.  However companies such as Microsoft, Apple and Google are investing heavily in AR and VR for both consumers and businesses.  This combined with the widespread availability of 5G makes me think it won’t be too far away before the UC and Collaboration tools that we use every day start to open up AR and VR for widespread B2B use.

How is the UK progressing with the rollout of 5G and full fibre technologies?

All 4 major UK networks are well underway with their 5G rollouts. Three and EE are ahead in terms of numbers of cities compared with Vodafone and O2, however the reality is that most major cities now have 5G which accounts for over 50% of the population.  The expectation being set by the operators is that it will take a further 5 years to reach 90% of the population.  Achieving this will involve turning off the 3G networks to re-use that spectrum to support 5G.  The last 10% may well require technology or an approach that has not yet been used in UK mobile networks such as using 5G satellite constellations to provide infill.

Biggest opportunities

The performance offered by 5G can be better than the performance offered by the fixed line broadband service available in many locations.  The channel are bound to have customers with poor broadband performance and 5G could well be the answer, especially when combined with a high performance 5G router and external antenna.

5G provides high performance Internet access in locations where there is no fixed line connectivity at all.  This means locations where solutions such as hosted voice, collaboration, IP CCTV could never have been supplied are now accessible for the first time.

5G requires new devices to take full advantage of the increased performance.  A fact often overlooked is that all the UK networks support LTE-Advanced or 4G+ with a much larger footprint than their 5G networks and yet the vast majority of 4G routers on the market today don’t take advantage of the extra performance.  In some cases a good quality LTE-Advanced or 5G router would provide up to 4 times the performance on 4G compared to using a device that doesn’t support LTE-Advanced.  In many cases where you’re deploying 4G in a fixed location we would recommend installing a 5G router because it will provide much better 4G performance and will be ready for 5G when the coverage reaches that location.

Biggest challenges

One of the biggest challenges is that a customers existing equipment may not be ready for the latest 5G or full fibre technologies. This means that there is a potentially significant capital expenditure required.

To address this problem, we launched our Device as a Service offering.  Good quality, high performance 5G devices are expensive, potentially three or four times the price of the equivalent 4G device.  Our channel told us that this was an obstacle to 5G adoption.  So now we offer all our devices on an Op-Ex model so that the channel partner and the customer don’t have any hefty upfront costs that might put them off taking advantage of 5G.

All 4 major UK networks are well underway with their 5G rollouts. Three and EE are ahead in terms of numbers of cities compared with Vodafone and O2, however the reality is that most major cities now have 5G which accounts for over 50% of the population. The expectation being set by the operators is that it will take a further 5 years to reach 90% of the population. Achieving this will involve turning off the 3G networks to re-use that spectrum to support 5G.  The last 10% may well require technology or an approach that has not thus far been used in UK mobile networks such as using 5G satellite constellations to provide infill.

Opportunities for the channel

5G has opened many opportunities for the channel. The performance offered by 5G can be better than the performance offered by the fixed line broadband service available in many locations.  The channel are bound to have customers with poor broadband performance and 5G could well be the answer, especially when combined with a high performance 5G router and external antenna.

5G provides high performance Internet access in locations where there is no fixed line connectivity at all.  This means locations where solutions such as hosted voice, collaboration, IP CCTV could never have been supplied are now accessible for the first time.

5G requires new devices to take full advantage of the increased performance.  A fact often overlooked is that all the UK networks support LTE-Advanced or 4G+ with a much larger footprint than their 5G networks and yet the vast majority of 4G routers on the market today don’t take advantage of the extra performance.  In some cases a good quality LTE-Advanced or 5G router would provide up to 4 times the performance on 4G compared to using a device that doesn’t support LTE-Advanced.  In many cases where you’re deploying 4G in a fixed location we would recommend installing a 5G router because it will provide much better 4G performance and will be ready for 5G when the coverage reaches that location.

Jola launched our Device as a Service offering to solve a problem that has been caused by 5G. Good quality, high performance 5G devices are expensive, potentially three or four times the price of the equivalent 4G device. Our channel told us that this was an obstacle to 5G adoption. So now we offer all our devices on an OpEX model so that then channel partner and the customer don’t have any hefty upfront costs that might put them off taking advantage of 5G.

2G/3G Sunsetting

The 5G rollout is leading to the 3G networks being switched off over the next 3 years. This is a huge opportunity because there are millions of devices that are 3G only and don’t support 4G. This means that when the 3G network is switched off suddenly payment terminals, tablets, kiosks, digital signage displays and many more devices will just stop working! 

This means that you have the opportunity to generate revenue from the hardware swap-out but also this is a great time to speak to your customers about swapping out your customers mobile data SIMs.  Many organisation did deals years ago with MNOs (particularly the M2M / IoT divisions of the MNOs) that the channel could replace via an aggregator like Jola, saving your customers significant money and making a healthy margin at the same time.

5G in the future 

Today 5G is being delivered using the same frequencies as 4G and typically delivers average speeds of around 150Mb/s and over 500Mb/s in perfect conditions. However, to unlock the true potential of 5G and deliver multi gigabit ultra-low latency performance then the operators need to start using the spectrum in the millimetre-wave (26Ghz – 40Ghz) bands and this will require regulatory change and significantly higher investment.  When this happens I think 5G can really deliver on the promise of any application anywhere and it’s not inconceivable that fixed line access is no-longer essential for many businesses and use-cases.