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5G Advanced and Wireless AI Set To Transform Cellular Networks, Unlocking True Potential

The recent surge in interest in generative AI highlights the critical role that AI will play in future wireless systems. With the transition to 5G, wireless systems have become increasingly complex and more challenging to manage, forcing the wireless industry to think beyond traditional rules-based design methods.

5G Advanced will expand the role of wireless AI across 5G networks introducing new, innovative AI applications that will enhance the design and operation of networks and devices over the next three to five years. Indeed, wireless AI is set to become a key pillar of 5G Advanced and will play a critical role in the end-to-end (E2E) design and optimization of wireless systems. In the case of 6G, wireless AI will become native and all-pervasive, operating autonomously between devices and networks and across all protocols and network layers.

E2E Systems Optimization

AI has already been used in smartphones and other devices for several years and is now increasingly being used in the network. However, AI is currently implemented independently, i.e. either on the device or in the network. As a result, E2E systems performance optimization across devices and network has not been fully realized yet. One of the reasons for this is that on-device AI training has not been possible until recently.

On-device AI will play a key role in improving the E2E optimization of 5G networks, bringing important benefits for operators and users, as well as overcoming key challenges. Firstly, on-device AI enables processing to be distributed over millions of devices thus harnessing the aggregated computational power of all these devices. Secondly, it enables AI model learning to be customized to a particular user’s personalized data. Finally, this personalized data stays local on the device and is not shared with the cloud. This improves reliability and alleviates data sovereignty concerns. On-device AI will not be limited to just smartphones but will be implemented across all kinds of devices from consumer devices to sensors and a plethora of industrial equipment.

New AI-native processors are being developed to implement on-device AI and other AI-based applications. A good example is Qualcomm’s new Snapdragon X75 5G modem-RF chip, which has a dedicated hardware tensor accelerator. Using Qualcomm’s own AI implementation, this Gen 2 AI processor boosts the X75’s AI performance more than 2.5 times compared to the previous Gen 1 design.

While on-device AI will play a key role in improving the E2E performance of 5G networks, overall systems optimization is limited when AI is implemented independently. To enable true E2E performance optimization, AI training and inference needs to be done on a systems-wide basis, i.e.  collaboratively across both the network and the devices. Making this a reality in wireless system design requires not only AI know-how but also deep wireless domain knowledge. This so-called cross-node AI is a key focus of 5G Advanced with a number of use cases being defined in 3GPP’s Release 18 specification and further use cases expected to be added in later releases.

Wireless AI: 5G Advanced Release 18 Use Cases

3GPP’s Release 18 is the starting point for more extensive use of wireless AI expected in 6G. Three use cases have been prioritized for study in this release:

  • Use of cross-node Machine Learning (ML) to dynamically adapt the Channel State Information (CSI) feedback mechanism between a base station and a device, thus enabling coordinated performance optimization between networks and devices.
  • Use of ML to enable intelligent beam management at both the base station and device, thus improving usable network capacity and device battery life.
  • Use of ML to enhance positioning accuracy of devices in both indoor and outdoor environments, including both direct and ML-assisted positioning.

Channel State Feedback:

CSI is used to determine the propagation characteristics of the communication link between a base station and a user device and describes how this propagation is affected by the local radio environment. Accurate CSI data is essential to provide reliable communications. With traditional model-based CSI, the user device compresses the downlink CSI data and feeds the compressed data back to the base station. Despite this compression, the signalling overhead can still be significant, particularly in the case of massive MIMO radios, reducing the device’s uplink capacity and adversely affecting its battery life.

An alternative approach is to use AI to track the various parameters of the communications link. In contrast to model-based CSI, a data driven air interface can dynamically learn from its environment to improve performance and efficiency. AI-based channel estimation thus overcomes many of the limitations of model-based CSI feedback techniques resulting in higher accuracy and hence an improved link performance. The is particularly effective at the edges of a cell.

Implementing ML-based CSI feedback, however, can be challenging in a system with multiple vendors. To overcome this, Qualcomm has developed a sequential training technique which avoids the need to share data across vendors. With this approach, the user device is firstly trained using its own data. Then, the same data is used to train the network. This eliminates the need to share proprietary, neural network models across vendors. Qualcomm has successfully demonstrated sequential training on massive MIMO radios at its 3.5GHz test network in San Diego (Exhibit 1).

Wireless AI
© Qualcomm Inc.

Exhibit 1: Realizing system capacity gain even in challenging non-LOS communication

AI-based Millimetre Wave Beam Management:

The second use case involves the use of ML to improve beam prediction on millimetre wave radios. Rather than continuously measuring all beams, ML is used to intelligently select the most appropriate beams to be measured – as and when needed. A ML algorithm is then used to predict future beams by interpolating between the beams selected – i.e. without the need to measure the beams all the time. This is done at both the device and the base station. As with CSI feedback, this improves network throughput and reduces power consumption.

Qualcomm recently demonstrated the use of ML-based algorithms on its 28GHz massive MIMO test network and showed that the performance of the AI-based system was equivalent to a base case network set-up where all beams are measured.

Precise Positioning:

The third use case involves the use of ML to enable precise positioning. Qualcomm has demonstrated the use of multi-cell roundtrip (RTT) and angle-of-arrival (AoA)-based positioning in an outdoor network in San Diego. The vendor also demonstrated how ML-based positioning with RF finger printing can be used to overcome challenging non-line of sight channel conditions in indoor industrial private networks.

An AI-Native 6G Air Interface

6G will need to deliver a significant leap in performance and spectrum efficiency compared to 5G if it is to deliver even faster data rates and more capacity while enabling new 6G use cases. To do this, the 6G air interface will need to accommodate higher-order Giga MIMO radios capable of operating in the upper mid-band spectrum (7-16GHz), support wider bandwidths in new sub-THz 6G bands (100GHz+) as well as on existing 5G bands. In addition, 6G will need to accommodate a far broader range of devices and services plus support continuous innovation in air interface design.

To meet these requirements, the 6G air interface must be designed to be AI native from the outset, i.e. 6G will largely move away from the traditional, model-driven approach of designing communications networks and transition toward a data-driven design, in which ML is integrated across all protocols and layers with distributed learning and inference implemented across devices and networks.

This will be a truly disruptive change to the way communication systems have been designed in the past but will offer many benefits. For example, through self-learning, an AI-native air interface design will be able to support continuous performance improvements, where both sides of the air interface — the network and device — can dynamically adapt to their surroundings and optimize operations based on local conditions.

5G Advanced wireless AI/ML will be the foundation for much more AI innovation in 6G and will result in many new network capabilities. For instance, the ability of the 6G AI native air interface to refine existing communication protocols and learn new protocols coupled with the ability to offer E2E network optimization will result in wireless networks that can be dynamically customized to suit specific deployment scenarios, radio environments and use cases. This will a boon for operators, enabling them to automatically adapt their networks to target a range of applications, including various niche and vertical-specific markets.

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Despite China’s Failure to Recover in Q3 2022, Global Cellular IoT Module Market Experiences Growth

  • China led the global cellular IoT module market in Q3 2022 despite losing volume share. China was followed by North America and Western Europe.
  • Smart meter, POS, automotive, industrial and router/CPE were the top five applications in terms of volume this quarter.
  • Automotive, router/CPE, PC, industrial and POS were the top five applications in terms of value this quarter.
  • The top three technologies in terms of volume were NB-IoT, 4G Cat 1 and 4G Cat 4. They captured more than 60% of the total volume in Q3 2022.
  • The top three technologies in terms of value were 5G, 4G Cat 4 and 4G Other. They captured nearly two-thirds of the total value in Q3 2022.

San Diego, Buenos Aires, London, New Delhi, Hong Kong, Beijing, Seoul – December 27, 2022

Global cellular IoT module shipments grew by only 2% YoY in Q3 2022, according to the latest research from Counterpoint’s Global Cellular IoT Module and Chipset Tracker by Application. China led the market followed by North America and Europe. China’s shipments decreased 8% YoY in this quarter due to a resurgence of COVID-19 cases. However, some of this demand decline was offset by an increase in the residential, smart door lock, patient monitoring, registrar device, smoke detector, drone, smart meter and automotive applications. Other markets such as North America, Western Europe, India, Japan, Latin America, and Middle East and Africa witnessed healthy growth.

Commenting on the competitive landscape, Associate Director Ethan Qi said, “Quectel is leading the cellular IoT module market, followed by Fibocom, Sunsea AIoT, China Mobile and MeiG. China is dominating this market with all the top five IoT module vendors being from the country. In the past few months, we have seen some consolidation among international players, like Telit taking over Thales’ IoT business and Semtech acquiring Sierra Wireless in the IoT module space to remain resilient against Chinese module vendors. With the increasing adoption of IoT technologies in various sectors, many players will consolidate to get bigger value from this fragmented value chain.”

Commenting on the important underlying technology dynamics shaping the entire IoT ecosystem, Senior Research Analyst Soumen Mandal said, “The IoT module market is undergoing changes as demand for low-end technologies like 2G and 3G declines and shifts towards 4G Cat 1 and 4G Cat 1 bis, where higher-end applications are upgrading from 4G to 5G. In this quarter, the top three technologies in terms of shipments – NB-IoT, 4G Cat 1 and 4G Cat 4 – accounted for over 60% of the total shipments. However, in terms of revenue share, 5G, 4G Cat 4 and 4G Other were the top three technologies and held nearly two-thirds of the total revenue. The lower-end technologies such as NB-IoT, 4G Cat 1 and 4G Cat 1 bis are helping connect a greater number of IoT devices, while higher-end technologies like 4G Cat 4, 4G Other and 5G are adding more value to the IoT ecosystem. This is why the automotive, router/CPE, PC and industrial segments, which rely mostly on higher-end technologies, are generating more revenue.

During this quarter, we saw some 4G Cat 1 and 4G Cat 1 bis-based applications being replaced with NB-IoT. Chinese NB-IoT chipset companies Eignecomm and Xinyi have improved their partnerships with module players, particularly in the domestic market. Besides, there were few options available for 4G Cat 1 bis chipsets in international markets, with Sequans being the exception. Last week, Qualcomm entered the 4G Cat 1 bis market by launching the QCX216 chipset in partnership with Quectel, Cavli Wireless and MoMAGIC. We believe that 4G Cat 1 bis technology will start to gain traction as leading IoT module and chipset players focus on it for use in massive IoT applications.”

Mandal further added, “Despite slower growth in IoT module shipments, IoT module revenue increased by 12% YoY in Q3 2022 due to a higher mix of 5G and 4G Cat 4 modules. The average selling price (ASP) of all types of 4G technologies and LTE-M continued to rise, while the ASP for 2G, 3G, 5G and NB-IoT technologies decreased. It is believed that 2023 will be a breakthrough year for 5G, and the ASP may decrease to below $100, which will help facilitate wider adoption.”

IoT module market Q3 2022 Counterpoint

Commenting on the key application trends in the IoT space, Associate Director Mohit Agrawal said, “The top 10 applications in the market captured more than 80% of shipments this quarter, with the top five being smart meters, POS, automotive, industrial and router/CPE. Smoke detectors saw the fastest growth, followed by residential applications and drones. China was a driving force in the growth of all three of these fast-growing segments, fuelled by a resurgence of COVID-19 cases in the country. Among the top five applications, industrial and router/CPE applications saw a decrease in shipments both on a sequential and yearly basis. However, the industrial segment still presents a large opportunity due to the number of companies embarking on digital transformation projects.”

IoT module application Counterpoint

For detailed research, refer to the following reports available for subscribing clients and individuals:

Counterpoint tracks and forecasts on a quarterly basis 1,500+ IoT module SKUs’ shipments, revenues and ASP performance across 80+ IoT module vendors, 12+ chipset players, 18+ IoT applications and 10 major geographies.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

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Soumen Mandal

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Mohit Agrawal

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Counterpoint Research

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Related Reports

Global Cellular IoT Module Shipments to Cross 1.2 Bn Units by 2030

  • 5G shipments to overtake 4G by 2028 to become the leading technology in the global cellular IoT module market.
  • Smart meter, industrial, router/CPE, automotive and POS will be the top five applications in 2030 in terms of shipments.
  • 5G RedCap mass adoption is expected to happen in 2027 and onwards.

San Diego, Buenos Aires, London, New Delhi, Hong Kong, Beijing, Seoul – May 9, 2022

Global cellular IoT module shipments are expected to cross 1.2 billion units by 2030 with a CAGR of 12%, according to the latest Global Cellular IoT Module Forecast from Counterpoint Research. The shipments will be mainly driven by 5G, NB-IoT and 4G Cat 1 bis technologies. 5G will be the fastest growing (60%) technology, followed by 4G Cat 1 bis, during 2022-2030.

With 5G becoming mature, we will see large module vendors such as Quectel, Fibocom, MeiG, Foxconn, Thales, Telit and Sierra Wireless consolidating their positions in the global cellular IoT module market. Longtail module vendors will struggle with scale and partnerships.

Commenting on the market dynamics, Senior Research Analyst Soumen Mandal said, “With the ongoing sunset of 2G and 3G networks across the world, most of the demand has been shifting to LPWA, 4G Cat 1 and 4G Cat 1 bis technologies until now. NB-IoT will still remain popular in parts of Asia, including China, and Europe, while 4G Cat-1-based modules proliferate over the next few years.

With LPWA technologies such as NB-IoT, LTE-M and 4G Cat-1 driving this initial adoption of cellular IoT, the global cellular IoT market will transition from 4G to 5G in the rest of this decade. This transition will be faster compared to the transition from 2G/3G to LPWA/4G in the IoT segment. 5G will be the leading technology in the global cellular IoT module market, followed by NB-IoT and 4G Cat 1 bis.

The rollout of 5G and introduction of 5G RedCap in coming years will see the adoption of 5G across intelligent IoT applications in industrial, asset tracking, POS, telematics, healthcare and wearables segments, mostly replacing traditional 4G IoT applications. We estimate that cumulative 5G shipments (excluding 5G RedCap) will reach 2.5 billion units, growing at a CAGR of 60% between 2022 and 2030.

By the end of this decade, we should see the introduction of 6G technology for IoT. However, 6G will be limited to higher-end applications such as enterprise and broadband in the initial years of adoption.”

IoT Module Technology Trends Counterpoint

Commenting on the cellular IoT module application landscape, Vice-President Research Neil Shah said, “Smart meter, industrial, router/CPE, automotive and POS will be the top five applications in 2030 in terms of shipments. 5G will be preferred for Industrial 4.0 (like robotics, automation and digital twins), router/CPE (like FWA and private networks) and automotive (like connected and autonomous mobility) applications, LPWA will be preferred for utilities (smart meter) and 4G Cat 1 bis and 5G RedCap for POS applications.

China leads in 5G adoption in the global cellular IoT module market. However, North America and Europe will have great potential in the future. 5G adoption in emerging markets such as India and Latin America will also grow faster and 5G RedCap may become popular in these regions.”

For detailed research, refer to the following reports available for subscribing clients and also for individual subscription:

Counterpoint Research tracks and forecasts on a quarterly basis 80+ IoT module vendors’ shipments, revenues and ASP performance across 12+ chipset players, 18+ IoT applications and 10 major geographies.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts:

Soumen Mandal

The Branding Source: New logo: Twitter

Neil Shah

The Branding Source: New logo: Twitter  

Counterpoint Research

The Branding Source: New logo: Twitter

press(at)counterpointresearch.com

Related Reports:

Global Cellular IoT Module Revenue Grows 58% YoY in Q4 2021; 5G, 4G Cat 1 Modules Fastest Growing

  • Quectel and Qualcomm led the global cellular IoT module and IoT chipset markets respectively in Q4 2021.
  • 5G contributed to nearly a quarter of the cellular IoT module market revenue.
  • Automotive, router/CPE, industrial, PC and POS were the top five applications in the quarter.

San Diego, Buenos Aires, London, New Delhi, Hong Kong, Beijing, Seoul – March 31, 2022

Global cellular IoT module revenue grew 58% YoY in Q4 2021, according to the latest research from Counterpoint’s Global Cellular IoT Module and Chipset Tracker by Application. China, the leading region in the cellular IoT module market, accounted for more than 40% of the revenue. However, India was the fastest growing (154% YoY) cellular IoT module market. 5G was the fastest growing (324% YoY) technology followed by 4G Cat 1 (105% YoY). Router/CPE, PC and industrial were the top applications for 5G.

Commenting on the market dynamics, Senior Research Analyst Soumen Mandal said, “Quectel, Telit and MeiG held the top three positions in the global cellular IoT module market, accounting for 40% of the total revenue in Q4 2021. For 2021, global cellular IoT module shipments and revenue grew by 59% and 57% YoY respectively.”

Quectel’s cellular IoT module revenue grew more than 100% YoY in Q4 2021. Strong partnerships, superior service and a wide range of product offerings are supporting its growth. Quectel launched a new ODM brand, Ikotek, targeting the US market. We expect it to help Quectel increase its footprint in North America and Latin America. Moreover, the products can be customized and designed according to the regulatory requirements of a project.

Telit made a strong comeback after a relatively weaker performance in recent history. Telit has been expanding its offerings, which is helping its revival. Telit NExT is providing flexible connectivity plans across 190 countries to take advantage of emerging business models and removing major bottlenecks for many IoT device vendors. In Q4 2021, Telit’s focus on Latin America to help customers migrate legacy 2G and 3G modules to 4G Cat 1 modules helped it become the leading module supplier in the region to complement its strong position in North America.

MeiG is another Chinese player which is making continuous progress and made it to the top three in cellular IoT modules, both in shipments and revenue. It is focusing more on AIoT and smart module-based higher-end applications such as router/CPE, intelligent cockpit, video recordings, industrial PDAs, drones and AR/VR. MeiG entered lower-end applications in 2021. This product mix of higher-end and lower-end modules helped MeiG increase revenue by more than 100% in Q4 2021.

Thales, Rolling Wireless, Sunsea, Fibocom and Sierra Wireless are other key players. Out of the top 10 players, Rolling Wireless and LG are focussing on the automotive segment only.

Thales is performing well in Europe, North America and Japan targeting smart meter, healthcare and industrial applications. Sunsea improved its performance in the global IoT module market, but it wasn’t enough to prevent its share from going down. The industry is growing at a faster rate compared to Sunsea’s growth. Fibocom is showing a stronger presence in 4G Cat 1 bis technology. However, Fibocom slipped out of the top five module vendors rankings due to weaker performance of NB-IoT modules.

Rolling Wireless’s and Sierra Wireless’s revenues increased 105% and 87% respectively. After spinning off from Sierra Wireless’s automotive division last year, Rolling Wireless quickly made it to the top 10 module vendors list. Rolling Wireless and Sierra Wireless have been successful in targeting specific applications, such as automotive and router/CPE respectively.

Global Cellular IoT Module Revenue Share by Module Vendor, Q4 2021

IoT Module Market Counterpoint
Source: Counterpoint Global Cellular IoT Module and Chipset Tracker by Application, Q4 2021

Automotive, router/CPE, industrial, PC and POS are the top five cellular IoT applications in terms of revenue. However, drones, PC and router/CPE are the top three fastest growing segments. Smart meters is another key segment but the lower ASPs of NB-IoT and 4G Cat 1 modules mean it is not among the top five IoT applications in terms of revenue.

Global Cellular IoT Module Vendor Shipment Share Rankings by Key Geographies, Q4 2021

IoT Module Market by Region Counterpoint

Commenting on the regional performance of module vendors and pricing dynamics, Vice President Research Neil Shah said, “International players made a strong comeback in Q4 2021 after weaker performance in the previous quarter. Quectel, MeiG and Sunsea were the top three cellular IoT module players in China in terms of revenue. For the rest of the world, Quectel, Telit and Thales were the top three cellular IoT module players.”

Quectel is leading in most regions except Latin America, India and Japan. However, as these regions currently represent a small share of the global cellular IoT module market, it doesn’t have much impact overall. Japan’s preference for LTE-M works against Quectel.

In China, MeiG overtook Fibocom to become the second largest cellular IoT module vendor.

Neoway, another Chinese module vendor, maintained its leading position in the Indian market. Strong partnerships with smart meter manufacturers and telematics providers are helping Neoway to maintain its position.

The overall cellular IoT module ASP increased 7% sequentially due to supply chain constraints, especially in 4G modules. Chinese chipset players are trying to reduce the 5G module ASP for mass commercialization. However, 5G adoption hasn’t picked up as expected. We see 5G peaking in the global cellular IoT module market after 2025.

For detailed research, refer to the following reports available for subscribing clients and also for individual subscription:

Counterpoint tracks and forecasts on a quarterly basis 1450+ IoT module SKUs’ shipments, revenues and ASP performance across 80+ IoT module vendors, 12+ chipset players, 18+ IoT applications and 10 major geographies

*Note: We have updated regional ranking data as per industry feedback (as of Oct 2022) which indicates Quectel led in India shipment share during Q4 2021.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts:

Soumen Mandal

The Branding Source: New logo: Twitter


Neil Shah

The Branding Source: New logo: Twitter  

Counterpoint Research

The Branding Source: New logo: Twitter

press(at)counterpointresearch.com

Related Reports:

Podcast #50 – Disruptive Trends Shaping the Next Decade & Beyond

It is always interesting to talk about the future. But in the absence of any magical crystal ball, getting your prediction right needs experience, vision and good judgment. Now, a lot has changed over the past couple of years, with the prolonged COVID-19 pandemic driving some new use cases of technologies. Many of these use cases will shape the digital future.

These two years have seen the fall of big smartphone brands like LG and Huawei, even as the pandemic-triggered pent-up demand helped boost other OEMs’ sales. COVID-19 has also caused semiconductor shortages across industries. Then there are geopolitical issues that are expected to slow down some technological advancements while accelerating others.

We discuss all this and more in this special edition of ‘The Counterpoint Podcast’ that focuses on our tech predictions for the next decade and beyond. Host Peter Richardson is joined by Tom Kang and Neil Shah to discuss some of the disruptive technology trends that we will see in the future. Partners at Counterpoint and friends, Tom, Peter and Neil share their views on 6G, smart glasses, foldables, OEM strategies, mobile network operators, quantum computing, tech cold war, and much more.

Hit the play button to listen to the podcast

You can download the podcast transcript here.

Chapter Markers for Counterpoint Tech Predictions

02:15 – Tom on changing dynamics of smartphone OEMs.

03:14 Neil on the house of brands and strategies.

04:43 Neil further talks about 1+N strategies.

05:45 Tom on services play by hardware companies.

07:38 – Neil discusses brands focusing more on IoT space.

08:34 Peter on Extended Reality (XR).

11:37 Tom shares his predictions for 6G, smart glasses and foldables.

13:36 – Neil on existing 5G network, iterations and transition to 6G.

15:33 Tom talks about drivers for 6G, smart glasses, and more.

18:56 – Neil on tech companies and operators.

21:10 – Peter talks about wearable devices and their importance in healthcare.

22:40 – Neil further talks about wearables, healthcare and e-commerce.

24:06  Tom talks about the tech cold war getting intense.

26:36 – Neil on OEMs becoming more vertically integrated.

27:17 Peter weighs in on the future of precision agriculture.

Also available for listening/download on:

      

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Will Foxconn Shake EV Industry?

Apple supplier Foxconn, with an aim to diversify its business and reduce overdependency on Apple for revenue generation, is betting big on electric vehicles (EVs). During the Hon Hai Tech Day 2020 (HHTD 20) event on October 16 last year, the company launched MIH, an “EV software and hardware open platform”, with an aim to position it as the “Android system of the EV industry”.

Foxconn is not new to the automotive industry. It has already entered partnerships with Yulon Group and FCA Group to produce EVs, provide parts and handle supply chain management. But will the self-declared aim of becoming the Android system of the EV industry make it a threat for traditional automakers? To find the answer, we will have to understand the extent of Foxconn’s ambitions in the automotive space.

MIH to target both software and hardware ecosystems

With the global smartphone industry maturing, Foxconn is looking for an alternative business opportunity. EVs and autonomous vehicles (AVs) perfectly fit into this strategy because here Foxconn can use its existing expertise in automotive and smartphone component manufacturing. However, Foxconn has no plan to make cars under its brand name. Instead, it will manufacture cars for its partners, just like it assembles phones for Apple.

Most of the automakers are using a closed system for developing cars. But Foxconn is aiming to build an open EV platform where any automaker can alter the design to meet specific requirements. Tesla is using its own platform to build EVs, just as Apple does in the smartphone industry. Since Tesla has come a long way in the race for EV industry dominance, Foxconn wants to become the Android of the EV industry. Getting into a partnership with a major automaker will be a challenge as such automakers may not be interested in sharing their core expertise with an open platform.

In the age of AVs, the software will play a crucial role. Foxconn is trying to tap this segment by having a software system that allows automakers and service providers to offer unique features.

Foxconn EV Announcement Timeline

Right partnerships to drive success

Foxconn has entered a partnership with Chinese EV start-up Byton, which is facing insolvency, to revive its EV brand. Foxconn is targeting to produce the M-Byton model starting 2022.

Foxconn has inked another partnership with Geely Holding Group to provide customised consulting service to automakers working with CASE (Connected, Autonomous, Shared and Electrified) technologies.

Apple is in talks with Hyundai Motor to build a pure electric autonomous car from 2024. It will be interesting to see how the iPhone maker and assembler compete in the same segment. Or will Foxconn start manufacturing cars for Apple as it does for its phones? the next couple of years, we may also witness more smartphone makers entering this space.

Whatever may be the situation, right partnerships with ecosystem players and the presence of an experienced leadership team will play a vital role in the success of the business.

Industry veterans to aid in faster development of MIH

Foxconn has hired an experienced leadership team for the MIH platform, which indicates that it is serious about this foray. Jack Cheng, who is a co-founder of NIO, ex-MD of Fiat China and chairman of XPT, besides earlier working with Magneti Marelli and Ford Motor, has been appointed as the CEO of MIH platform. William Wei has been appointed as the chief technology officer (CTO). He has more than 20 years of experience in internet and mobile computing which can help Foxconn build a software-powered car like Tesla.

MIH has already more than 400 partners, with ecosystem players like Amazon Web Services, Mediatek, Qualcomm, ST Micro, Texas Instruments, Eaton and Dana. Foxconn also launched an EV developer kit technical specification on January 31, 2021, displaying seriousness about following the declared timeline.

Foxconn’s aim goes beyond EV platform

As part of a new strategic plan, named 3+3= ∞, Foxconn is focussing on three emerging technologies: EVs, digital healthcare and robotics.

As part of a long-term plan, it is trying to become a key supplier for the EV and AV ecosystem. It is already working with CATL and SES to develop its solid-state battery by 2024, while aiming to get a 10% market share in the EV component and services industry by 2027.

Foxconn is also trying to build a state-of-the-art battery management system (BMS), powered by cloud-based artificial intelligence (AI) to improve battery efficiency.

Some airport shuttle buses with Level 3 autonomy and one of the smallest LiDARs (A15) in the world are supported by Foxconn technology. The MIH platform is being readied for 5G, 6G over-the-air (OTA) update and vehicle-to-anything (V2X) communication. Therefore, Foxconn is preparing for the connected and AV space in future. However, it may face strong competition from Qualcomm and Microsoft in this segment.

Counterpoint’s take

As Foxconn is not interested in building its car brand, it may not be a threat to major automakers. But EV component suppliers may face stiff competition from Foxconn. Scalability and price will play a key role in the selection of component players by EV makers.

Large automakers with a clear goal of electrification may not be interested in an open platform as it may raise questions of security and intellectual property. However, small players and start-ups will be more interested as a shared open platform will require less investment.

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We may monitor how you use our Web sites. It is used solely for purposes of enabling us to provide you with a personalized Web site experience.
This data may also be used in the aggregate, to identify appropriate product offerings and subscription plans.
Cookies may be set in order to identify you and determine your access privileges. Cookies are simply identifiers. You have the ability to delete cookie files from your hard disk drive.