Technical Articles

Bluetooth 5.0 and Business: So, you think you've see the bigger picture?

The Bluetooth Special Interest Group (SIG) announced the release of Bluetooth 5.0 in late 2016. Then, in 2017, Bluetooth SIG announced that Bluetooth would start supporting mesh networking. Bluetooth will provide a new building block for building automation and industrial wireless sensor networks in the future. Meanwhile, its support for IoT market will also be made more secure. There are quite a few highlights in the impressive new standard. In particular, performance enhancement stands out and can be summarized with three numbers: 2, 4, and 8. Data transmission speed is 2 times faster, up from 1Mbps in Bluetooth 4.0 to 2Mbps in Bluetooth 5.0. Signal range is 4 times longer, extending up to 300 meters. Broadcast messaging capacity is 8x, up from 31 bytes to 255 bytes. 

Evolution of technical standards often suggests an underlying business idea. So what are the business opportunities behind Bluetooth 5.0? Let's speculate.

Some believe that wireless audio is one of the key areas where Bluetooth 5.0 can really shine. Given that Bluetooth technology is currently mainstream in consumer wireless audio, Apple's AirPods being a demonstrative example, huge growth potential can indeed be expected of wireless audio. However, Bluetooth 5.0 makes no particular enhancements in audio signal compression, lag, or energy consumption. It is clear that such tasks will be included in the upcoming standard version, the launch date of which is expected to be 2018 at earliest. Hence, the wireless audio market is not a focal point for Bluetooth 5.0. 

Since Bluetooth 5.0 was unveiled, Samsung has been the mobile phone maker most eager to follow the technology. The company was first to incorporate Bluetooth 5.0 into its Galaxy S8. DJ Koh, head of Samsung's mobile business, also left much room for imagination in his explanation: Who said that the Galaxy S8 was just a phone? It will be a hub connected to other devices via Bluetooth technology. This interpretation happens to hit the bullseye with the real core market of Bluetooth 5.0: the Internet of Things.

Bluetooth 5.0 and Business

Fig. 1 Samsung Galaxy S8 becomes the first Bluetooth 5.0-enabled smartphone

One of the major applications of Bluetooth 5.0-enhanced IoT is home IoT. While as a point-to-point connection based wireless technology Bluetooth did not originally excel in IoT, Bluetooth 4.0 rode into the battle on the back of BLE technology and tangled with WiFi, ZigBee, and other wireless standards. Now Bluetooth 5.0 offers improvements in both range and speed, which enable easier, faster control and management of IoT sensor nodes. The advantage will give Bluetooth an edge in the future, especially over ZigBee, a technology that also advertises on low energy consumption. 

It is worth pointing out that Bluetooth 5.0 is optimized for stable connections to ensure coexistence with other wireless technologies on the crowded 2.4GHz band. For example, Bluetooth 5.0 avoids channels used by WiFi and adds slot availability masks to detect and automatically prevent interference with cellular networks. 

Given that Bluetooth is now a standard feature on smartphones and other mobile devices, it enjoys a certain degree of advantage in terms of penetration. Thus, some analyses conclude that Bluetooth 5.0 will provide a platform in home IoT applications in the future. ABI Research forecasts that there will be 48.0 billion Internet-connected devices in the world by 2021. One third of those will be equipped with Bluetooth. With Bluetooth 5.0 making systems less complex and less costly, and connections faster and more reliable, it is clearly accelerating progress. 

Bluetooth 5.0 and Business

Fig. 2 Avnet Bluetooth-based smart home lighting solutions 

However, Bluetooth 5.0 is not betting all of its chips on home IoT. Another area of application will reach into commercial applications. "New retail" is popular new buzz word. It refers to the use of new technology to enhance the shopping experience and explore user value. Bluetooth beacon technology is in a perfect position to take advantage of those opportunities. 

To put it simply, a Bluetooth beacon detects the user's Bluetooth device (e.g., mobile phone) and broadcasts information to the user when the two devices are close to each other. The process does not require pairing. The user has only to install a beacon app. Hence, department stores have always been the ideal setting for Bluetooth beacons. For example, beacons can be placed at specific locations in a shopping mall to push location-based offers to users. Since beacons require very little space and power (button batteries can last years on standby) and their costs can be easily managed, the scenario is quite convincing. 

However, under previous Bluetooth standards, a beacon's broadcast capacity was restricted by the maximum data length of 31 bytes. Limited capacity made it difficult to convey more extensive information to users. Bluetooth 5.0 provides a solution to the issue by extending the data length to 255 bytes, thereby allowing more possibilities in commercial applications. 

Bluetooth 5.0 and Business

Fig. 3 The Bluetooth-based indoor navigation system at Gatwick Airport 

And all of this is just the beginning. Bluetooth beacons can be used to develop more location-based services (LBS), such as indoor positioning systems. One of the cases Bluetooth SIG often mentions is Gatwick Airport, where 2,000 Bluetooth beacons have been installed to create an indoor navigation system that is more reliable than GPS. The system provides passengers an instant personalized information service. Although Bluetooth 5.0 offers no significant improvement when it comes to the precision of indoor positioning, it is nevertheless a big step forward. According to an ABI Research report, the number of Bluetooth beacons to be shipped in 2020 will exceed 371 million. Bluetooth 5.0 will play a crucial role in that development. 

Thus, with one foot in home IoT and the other in commercial applications, Bluetooth 5.0 stands on a potentially massive market. Do you see the big picture now?

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