India needs a broad enterprise M2M strategy

by Sohini Bagchi    Feb 04, 2013

machine to machine

Lack of standardization and interoperability are deterring the growth and development of machine to machine (M2M) market in India. However, a recent report by analyst firm Frost & Sullivan estimates that innovation and a broad enterprise M2M strategy will stimulate revenue growth of 22.3 percent by 2017 with greater needs evolving from customers.

Growth opportunities
The worldwide M2M market is already witnessing an impressive growth with communication moving toward wireless based communication systems from the traditional wired systems. Sectors such as banking and financial services, retail, utilities and logistics, among others are increasingly deploying remote monitoring and controlling of various devices. These developments are offering huge growth opportunities for telecom services companies and enterprises.

According to Frost & Sullivan, telecom services companies in India should seek newer ways for revenue growth in the M2M segment. For example, there is a lot of potential for M2M offerings in the Indian SMB segment that telecom companies should explore in the coming months to garner better revenue, says the report.

Yiru Zhong, Senior Analyst at Frost & Sullivan opines that telecom service companies should not only address a wide spectrum of customer needs but also increase revenue by increasing customer awareness in this segment. This however involves a wider market development strategy. “Higher growth and revenue is achievable when M2M revenue would be derived from utilizing the intelligence generated from machine data or in enabling enterprises to develop new functionality or new services to their end customers,” says Zhong.

Challenges remain
Despite significant growth opportunities in connected devices, experts at the recent Convergence India conference believe that the issue with lack of standardization must be addressed first. Ashok Chandak, senior director of global sales and marketing at NXP Semiconductors India states the M2M market in India extremely fragmented and there has to be interoperability at the hardware and software level for easier upgrades in the future.

The M2M models further need high level of customization. According to technology evangelist and professor in Electrical Engineering at IIT Chennai, Ashok Jhunjhunwala, what works for one industry, such as utility or smart metering may not work for retail. So the service providers have to be very careful when they are addressing a particular segment.

The other challenges revolve around poor network coverage, security and data-privacy, believes Jhunjhunwala. The M2M segment lacks standards in the country as there no industry body specifically looks into matters that involve connected devices. On the positive side however, the Indian government’s initiative to roll out the national fiber network will offer connectivity to local governments. This will enable significant broadband penetration at the rural and remotest areas and can be a boon in M2M adoption.

Despite challenging scenario, Frost & Sullivan is optimistic about the M2M market development. Zhong believes that the situation will improve by widespread customer awareness and education for M2M adoption. Moreover tremendous growth will be triggered by mobile service operators generating new income streams, growing demand for smart metering market and vertical wise adoption of M2M devices and applications in the coming days.