Earlier this year, I plugged in a Helium hotspot and created a node on a distributed network designed for the internet of things. Three months later, I am prepared to share my experience with the hotspot, along with how my thinking around Low-Power Wide-Area Networks (LPWANs) has changed as a result of this experiment.
First up, let’s talk about Helium’s history and business model. The company was created in 2013 because its founders realized that the internet of things was promising, but also tough to implement. If you wanted to make connected sensors useful and ubiquitous you had to make connected sensors easy to install and cheap to operate. Which is why when Helium first launched it was building a proprietary radio protocol embedded in sensors.
That didn’t work. So Helium changed up the model. Amir Haleem, the company’s co-founder and CEO, has long been a proponent of a decentralized internet, so he created a decentralized IoT networking protocol called LongFi and adopted cryptocurrency to make it worthwhile for people to become nodes on Helium’s network.
Haleem’s insight was that LPWANs for the internet of things needed to be plentiful and cheap. If you charge a lot of money to send relatively small amounts of data you’ll only get high-end use cases, such as tracking diamond shipments or whatnot. And there are plenty of existing networks—including cellular—that meet that need. What the IoT needed was a way to send small amounts of data at low power for a penny or so per transaction.
That way if a company wanted to connect a smoke detector to the internet, it could afford to do so in a manner that wouldn’t make the device cost-prohibitive, or require the manufacturer of the smoke detector to create a subscription plan simply to pay for data. The cellular industry is trying to build a low-cost network for IoT on traditional licensed spectrum called NB-IoT. Other companies, such as Sigfox and Senet, are also trying to build low-power IoT networks from scratch.
But Haleem’s contention is that if the goal is to try to connect a bunch of data-sipping, low-cost devices to the network, the cost of building a centralized network is simply too high. Instead, the network must be decentralized and look more like a shared, user-created network.
And so both the Helium hotspot and Helium token network were born. Haleem hopes that users will install Helium’s physical routers on their broadband networks to create an ad hoc IoT network that will transfer data over those users’ home or office broadband connections. To incentivize users and create security, Helium created a blockchain called Helium Network Tokens that accrue to people who run a Helium hotspot.
Helium hotspot owners can earn tokens for providing a connection to passing devices as well as for simply existing as a node on the network. For now, Helium Tokens are exchanged for data credits, which allow your devices to surf on the Helium network. In early March, Helium announced that it would add LoRa support for its network, which was a big deal for the company, because at that moment the network became useful for hundreds of existing sensors and devices already in the world.
It also meant that more people would have an incentive to buy or build a hotspot for the Helium network, because there was now more demand for such a network. For me, it meant that suddenly my Hotspot would get more pings, earning me more tokens.
So now let’s talk about the Helium hotspot experience.
The hotspot is a $350 device that plugs into an outlet and sits on your Wi-Fi network. When you open the box and plug the router in, you start by downloading the Helium app, which is available on iOS and Android. (I’m using Android). First up, you’ll need to choose a set number of security words in case you need to access your account.
Because this is a secure network, only you have these security words, and only these words will unlock your account so that you can get tokens and adjust things. If you lose them, you will be forever locked out of your Helium hotspot and the tokens it generates. So write them down on the card they provide with the box and store them safely. All of which also means that once you own a Helium hotspot and link it to your account, you are its owner forever. That might change one day, but for now, there’s no resale value in a Helium hotspot.
Once you have your words securely written down and stored, the process of getting the hotspot up and running takes about two minutes. Seriously, you just plug in some cables and let it go. It took mine about three days to finally authenticate to the network, but that’s probably because I live in a remote area and am the only hotspot for miles. In nearby Seattle, however, there are quite a few.
So far, I’ve earned 520 Helium tokens since joining the network on March 2, and I can send those to others using the system by using a QR code. I’m not super clear on this part, since I’ve been in quarantine that whole time and don’t really have a device that needs data at the moment. I’ll also note that if you don’t want to buy a Helium hotspot, Helium is fine with that. The company is licensing its software so makers can put it on their own LoRa hotspots while still becoming part of the overall network and earning tokens.
To test my network, Helium sent me a LoRa GPS tracker. While they added it for me, it seems like a simple enough process to connect a device to the console. One way or another, I can now manage my devices and eventually transfer data credits so those devices can stay connected. Currently, data credits aren’t needed during the beta process.
I can now track where my LoRa GPS tracker goes on a map or create notifications, as well as send the data from the GPS tracker to other cloud services. Someone who has more experience with backend device management applications would need to review the features of the platform, but I thought it was fairly easy to understand. Coverage isn’t a problem for me on the island where I live, and I’ve picked up other hotspots during my brief journeys into Seattle for doctor’s appointments.
I haven’t embarked on my usual spring conference travels because of the quarantine, but Helium’s coverage map, for now, seems to have most major U.S. cities covered. I am excited by the concept, and hopeful that the company can really bring an LPWAN to the mass market. And honestly, I’d be thrilled if my network were to be a part of that, tokens or not.
I decided to order this back in March when I heard you talk about it on TWiG, and I just got it in today! I’m currently the only Helium hotspot in my city of 300k, but I’m hoping more will appear. I’m interested to see where this goes, and what new features and opportunities will come of it. 🙂
You must be a happy camper … congrats, can only imagine what you have earned over the last year and a half or two.
Well, I guess you weren’t aware either of the huge % cut in earnings each hotspot would be making after Data Credits kicked in. Of course, it was known it would have an impact on earnings but it certainly was not clear that it could be up to 85% less.
The company shuts down for vacation right after it goes into effect and as all the new hotspots owners are just receiving their hotspots discovering what they won’t be earning and disappointment and anger takes hold.
Nice. Right?
This could have been handled so differently and so much better. How are you supposed to put trust into something like that after this happens? There’s no reason for not knowing that it was going to be this bad unless there was. As I said to someone today, if they had wanted it to be clear it would have been.
I saw that. I know they are now asking for feedback in response. I don’t think the vacation was a nefarious thing. I read as a desperate sprint to get something done, and then take a break, without thinking through the inevitable consequences that change means to a user base. But yes, the cut in earnings was significant and surprising, but now my credits are actually worth something, so I’m not as upset.
If you don’t want your hotspot I’ll take it … didn’t think so
This reminds me of Uber. You have no control over what you get paid or when. I doubt that someone “owns” a hotspot. Ownership means total control and deciding your own rate of compensation. Meanwhile, you pay $0.15 per kilowatt-hour (or more) 24/7. How does that compare to the value of your tokens?
Nice write up. However, please clarify when you stated it “…sits on your WiFi network.” I guess I’m confused. You already need to have internet already? I’m a full time RVer and looking at this as a possible internet solution. Thanks.
LoRa is not a super long-distance tech, so it needs some way to backhaul back to the internet. You could do satellite plus LoRa or simply satellite as the new services come online that support sensors. LoRa is not a substitute for broadband, tho, so whatever broadband service you might be using for your internet could offer the backhaul for a LoRa router.
Hi Stacey can you guide me to a genuine device seller in Australia, I already lost $1k in dealing with a scammer website which closed down after taking few orders.
From what I have read, the helium hotspot must remain stationary. If you move, there is a $10 fee to reassign you to your new location. Not a big deal for people moving every few years, but not ideal for a full time RVer. As a fellow RVer, I am looking into placing a unit at the home of a relative. This would give you easy access to other hotspots on the LPWan (not the hotspot, but the network) . Having data in your RV in locations that have no wifi or cellular could be a huge advantage. Think monitoring your rig’s temp while hiking. Having an alarm system that calls you. Smoke alarms that call you, Tracking devices to locate you rig if it is stollen…..
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Hello Stacey,
Great article. Thanks for the detailed explanation.
Helium just had their global launch and I plan to purchase a hotspot but I fear I might have the only hotspot for more than 1000 square miles around .
Please I have a few questions and your clarification would surely be helpful .
i. Does the Helium Hotspot require connection to the internet at all times? Especially for a lonely hotpot in a wide area.
ii.Is the Hotspot fixed to a location or can it be moved around from city to city ? Will that have any effect on the earnings and performance ?
iii. Are you allowed to connect your personal lora devices and sensors to the hotspot for say your personal tracking or monitoring (personal use of network) or the access rights only permits hotspot owners to provide network connection and to earn Tokens by doing so ?
iv. You stated in one of your comments that “Now your credits are actually worth something ” . Please could you elaborate on this ? So far have you been able to convert the HNT to fiat currency USD ? If not how else are the earnings of value ?
Your answers would be really appreciated .
BR
Kingsley
Reply
A part-time blogger with deep pockets is preparing to launch a “Helium Support” venture. While that may not normally be notable, she* is investing (or perhaps raising) more money than Helium itself—all for the purpose of deploying LongFi nodes across the Americas (35 countries).
This effort will help all of us. Let these babies multiply.
Disclosure: I work for this individual. We hope that our plans turn into an NGO before year-end
Even before she formed an NGO biz plan, she has has awarded Helium hotspots to some of the Geeks in her other ventures. She is focusing first within USA, but currently distributing to the most sparsely covered regions.
Unfortunately, she wants no personal publicity and not even recognition that there exists a deep to assist with deployment. But I am determined to help her make a difference.
https://awildduck.com/?p=6433
_____________
* A Wild Duck is edited and published by a woman of means who uses “Ellery” as her Nom de Plume.
I bought a helium hotspot it should be coming soon when I plug it into my house and I see that it’s actually working and mining tokens can I then purchase more hotspots and give them to my friends under my code and receive the tokens
I am still having problems working with a wlrgrm-100, I want to be able to see what it is doing
Thank you for the great article. This sounds like a great opportunity. Now that most people are working from home, are you aware of any security concerns sine we use our own WiFi to power the hotspot? My spouse works for local government and wouldn’t want to jeopardize her work. Any insight would be helpful. Thank you in advanced.
The hotspots must be connected to the internet in order to communicate with the blockchain. They must be stationary in order to pass the challenges. The HNT tokens you earn can be transferred to exchanges like Binance.us/Bilaxy and others and sold, then exchanged for Fiat currency and withdrawn.
i didn’t get the part where devices connect to my hotspot miner. how can people connect to it to get more token rates higher?
The hotspot needs to have an internet connection. Then it can ONLY connect to other hotspots or IoT devices not people, phones or laptops
Hi Stacey,
Good writeup, Just wondering how things are now with your hotspot nowadays. The demand for the hotspots seems to be growing.
Hello Stacey,
Thank you for the great article!
Could you provide your hotspot model ?
I cannot seem to find it in the helium store (I only see it in the marketing pictures).
https://www.helium.com/mine
Thanks
Mine isn’t offered anymore. It was the original Helium-manufactured hotspot to jumpstart the network and demand.
Can I mine helium in Nigeria
Hello,
I have just ordered the CoolSpot for Poland and got pushed to a waiting list. Too bad. Still however i would have a question on the entire concept for CoolSpot. What is the reason for blockchain (Helium) in this solution, especially with mining mechanism built in? The overall concept is great but wouldn’t this be simpler that individual people get paid xx $ for each 1 hour of uptime of the CoolSpot? What is the role of this mining?
Best wishes,
Jack
They don’t have the cash to pay everyone to mine. The blockchain essentially costs them nothing to give to you. But just as importantly, during a later phase the Helium can be broken down into data credits which will be used to buy data on the network, hot spot owners will be paid for much data moves through their hot spots at that time. This expected future value of the Network tokens drives speculative value now which is leading to a runup in the price of tokens now, which increases the rewards of miners, as the amount of tokens distributed is declining.
Great article Stacy,
I am in the process of establishing a Helium IoT peoples network here in South Africa. I know there is no license requirement for the frequency band but there is regulation for the devices used to be approved by ICASA so I will be doing that process as soon as one of the devices arrive. I am going for the Bobcat 300 miner so if anyone has already done the process of having it verified by ICASA please let me know as this will help the process. I may also bring in a RAK 4 and a Nebra if they become available for sale soon and have them verified.
Please also let me know if you are located in South Africa and are also looking into helium mining and helping to expand the network.
im new here so this may seem like a dumb question, but all I am seeing is small devices that send a packet every so often to this network. can it actually be used as an internet substitute for things like surfing the web or watching a youtube video? what are its limitations? thanks
no, this piggybacks on your Wi-Fi network to send IoT data only.
Stacey, thank you for this informative article. I’m curious: Have you any insight into the possible conflict of interest between the Helium network and the ISPs that essentially provide free backhaul for these hotspots? They (the ISPs) typically have some acceptable use policies that prohibit the “reselling” of their network.
Many ISPs do something similar with their own public Wi-Fi offerings, so it would be somewhat hypocritical. That’s not to say they wouldn’t, but so far I haven’t heard of any ISP protests. These are very small data amounts of data so it’s not like it’s causing network congestion. I do think that if it impacted network security that would quickly become a problem, but so far Helium is aware of that potential threat and guards against it as much as they can.
Helium is not actually reselling the ISP service. The ISP is used as an internet backhaul – meaning you are using the ISP to send data as you would use it under normal circumstances. Example when you send an email. Helium is a LoRA network and hosts effectively are LoRA service providers. In the US LoRA is 900mhz. and if you really flex the modulation (which Helium does not) you could get 253kbit/s of data rate). You are not giving others your Wi-Fi. You are not extending your Wi-Fi for others to use, as Ring and Amazon are trying to do. This is sometimes confusing for folks interested in Helium.
PEOPLE ARE ASKING: DOES THIS DEVICE/HOTSPOT GIVE OFF/ISSUE DANGEROUS WAVES? OR IS IT LIKE HAVING A RADIO ON ALL DAY IN YOUR HOUSE.
It transmits 900mhz bursts randomly throughout the day. It is not like a “radio on all day” as that is just ‘listening’ for radio waves that are already coming into your house and then pulling the music or news off them and playing on a speaker. The power level is limited. If you are seriously worried, you can mount an external antenna outdoors, but the majority of people run the unit out of the box on a window sill.
If you sign-up for Helium and are paid in a blockchain that “is worth something”, do you have to check the box on your 1040 that asks if you held or traded any cryptocurrency during the tax year? One would have to assume Yes, unless that “something” is just machine-to-machine access privs that cannot otherwise be purchased, traded or redeemed for currency in any way. (Even then, if you are business and amass a large amount of machine-to-machine access privs, it follows that your business is worth more and so if you trade the business, then how do you account for it?) A big thank you to the Bitcoin losers for legally derailing blockchain technology but don’t forget that Napster derailed peer-to-peer (including emergent peer-to-peer that would have precluded the advent of Facebook or simply supports low-band IoT like Helium) with its lengthy list of novel court rulings (that hold tech companies that enable access to peer-to-peer networks legally liable for the content passed over the peer-to-peer network by their end-users).
I do plan to report the gains from the sale and also from the value at mining, and had to find a program to help me with that. It was a pain.
Generally tax law requires you to report the cost of acquiring an asset. In the case of mining Helium the cost would be the some portion of your internet bill, the cost of your electricity and the maybe a portion of the cost of the miner. You can just plug in some reasonable guestimate of these costs as they will be negligible. Then when you sell the Helium you will record the price you sold it for and will be taxed on the difference between selling price and cost, which is your profit.
You pay taxes on money you earn, whether it is from a job, selling stock or selling cryptocurrency and in fact capital gains tax rates from selling stock and cryptocurrency are way lower than what workers pay.
My bad, Looking into it further I realize that the IRS treats mining as self employment income, so you do pay taxes at time of mining. I guess it treats it as being paid a currency rather than creating a capital asset. That is unfortunate.
Hi Stacey – great article thank you! Have you come across any resources about the potential safety (radiation, emf, etc) of these devices. Thinking about adding to my home but have two kids and enough emf and radiation risks with cell phones, wifi and microwaves in house but curious if any data out there on safety since these must be fcc licensed.
Hi Matt,
They use the ISM unlicensed bands, which varies by country/region.
As for FCC, RF and EMF I’d say do your own homework. My WiFi gets turned off every night at bedtime for those very reasons.
I wouldn’t put one (or any RF transmitter) next to my bed or anywhere where I sit for periods of time. Bluetooth messes with my sleep.
Cheers
Hoppy