Guide: Cellular vs Wifi for IoT

Brick and mortar retailers have traditionally relied on WiFi or wired ethernet to enable Point of Sale (PoS) systems. However, modern consumer trends, accelerated by the COVID-19 pandemic, are leading merchants to another connectivity option.

Secure, efficient, and flexible, cellular data is a wiser alternative to WiFi. Cellular data enabled by IoT SIM cards offers better coverage and faster deployment. Here, we’ll explore why PoS device vendors should consider cellular-enabled devices over WiFi-only ones.

Data-powered PoS hardware is comparable to mPOS, with superior security

The global Mobile Point of Sale (mPOS) market is booming. In 2020, Global Market Insights reported that the mPOS Terminals Market size had exceeded 20 billion. mPOS systems allow retailers to process payments using smart devices and hardware such as magstripes or NFC readers.

With mPOS, stores can initiate transactions easily, but this comes with security concerns. General WiFi networks are not encrypted and if merchants operate on open or poorly protected networks, their mPOS devices may become compromised. Without safeguards, malicious actors can impersonate a retailer’s network and hack into a merchant’s devices. WiFi also relies on regular security updates, which the average device owner may overlook.

Cellular data, in contrast, is more secure, and device owners’ identities are authenticated and protected by dedicated network operators. It’s also difficult for cybercriminals to mimic cellular data networks due to operators’ extensive security practices and substantial size and scale.

To deliver competitive offerings in the PoS space, vendors must use a dedicated PoS device with built-in hardware and software security, and a SIM card that provides the same free-roaming connectivity as mPOS devices.

Cellular data is more reliable than WiFi

When it comes to PoS, loss of connectivity means lost sales. WiFi is notoriously patchy in any deployment and can have dead-spots, require router resets, and lead to signal disruption.

WiFi is designed for local area networks (LAN) and is therefore limited to specific physical areas. As a device moves away from its dedicated area, retailers may experience dropouts, which can cause service interruptions. Cellular data, on the other hand, has fewer issues and is more reliable. Some businesses use cellular data as "fail-over" connectivity when WiFi drops, but this can result in lost sales if payments decline even once. Customers are better served using always-on cellular data instead of toggling between cellular data and WiFi.

Unlike WiFi, cellular data can use low power, wide area network (LPWAN) technology. IoT applications like PoS systems, can use LTE-M or NB-IoT networks, which provide wider coverage than traditional cellular technologies. These networks expand to underground spaces, buildings, and rural environments, ensuring retailers are always covered.

It’s faster to deploy new devices with cellular data

Activating cellular data on an IoT device is as simple as ordering a SIM card and placing it inside your device. With WiFi, configuration is more complex as it involves connecting larger sets of hardware (routers, modems, etc.) and higher dependencies on your internet service provider (ISP). Challenges range from authentication issues to IP provisioning to selecting the right WiFi band, and the list goes on.

Deploying IoT devices in corporate or franchise environments requires working with IT departments—often remotely—to get the WiFi up and running, which can be slow and frustrating. Cellular data gives you out-of-the-box connectivity, independent of the store’s WiFi, thus providing inherently better security. Even if your IoT deployments are better suited for WiFi, cellular data can still play a critical role in your platform uptime and resilience. Ensuring that devices are fitted with SIMs allows cellular data to act as a fall-back when WiFi networks falter or crash.

Cellular data gives freedom and flexibility

Today, retail and restaurant success rely just as much on experience as it does on products or services. Successful retailers run pop-up shops in new areas, rearrange their stores for special events, and continuously iterate on in-store experiences to maintain customer interest. To execute these experiences, merchants require flexible PoS systems that can automate checkout processes, track sales, and integrate with other business applications.

Cellular-enabled PoS terminals make this possible because they’re not limited to a local area. Sales can be made away from stationary counters, without the fear of WiFi dead spots inside or outside a retailer’s business.

Cellular data competes on bandwidth

The development and proliferation of 4G+ networks have leveled out the playing field between WiFi and cellular data bandwidth. For years, WiFi’s 450 megabits per second (Gbps) standard and more recently, its ability to reach 1.3 Gbps makes it superior in speed. However, 4G LTE is catching up to WiFi speeds with a standard of 1Gbps. With new promises of WiFi based on the 802.11ax (also known as Wi-Fi 6) standard reaching speeds up to 10Gbps, new cellular technologies will place 5G at similar speeds. Today’s cellular networks have closed the bandwidth gap, making the two technologies equally capable of high-speed connectivity.

Multi-carrier coverage is the future of PoS connectivity

Cellular data and IoT terminals are the future of PoS connectivity, but traditional carrier SIM cards aren't built for IoT. A better option is to choose a cellular data provider with multi-carrier support. PoS device vendors can use SIM cards that offer global coverage, are designed for IoT usage, and use pay-as-you-go pricing.

Telnyx IoT SIM cards make it easy to deploy your PoS devices across the globe. Our IoT SIM cards have out-of-the-box coverage in 180+ countries, and an API platform to manage SIMs over-the-air. With our award-winning Mission Control Portal, PoS vendors can seamlessly transition to cellular-enabled devices.

Ready to use cellular data with your PoS device? Ask our experts or get a SIM cardshipped to your door.