M2M Emerges As Major Growth Area For Mobile Operators

by CXOtoday News Desk    Feb 17, 2014

New age tech

As connected living comes of age, M2M will emerge as a high growth area that can offer major growth opportunities for mobile operators. According to a new report by the GSMA, global machine-to-machine (M2M) connections are expected to hit 250 million this year.

The new report from GSMA Intelligence, “From concept to delivery: the M2M market today”, tracks the development of the M2M market from 2010 and confirms that ‘Connected Living’ has come of age as operators begin to scale deployments of M2M solutions across a range of vertical sectors.  

The study finds that global M2M connections reached 195 million in 2013, growing at nearly 40 per cent per year (38 per cent CAGR) between 2010 and 2013. M2M connections are expected to reach 250 million this year. M2M accounted for 2.8 per cent of all global mobile connections at the end of 2013, double the 1.4 per cent share recorded in 2010.

“We are now living in a world where every device, machine or appliance can be wirelessly connected to the internet, providing a wealth of real-time information that can transform how people live and work. For mobile operators, connecting ‘machines’ to their networks is now a major focus area,” said Hyunmi Yang, Chief Strategy Officer, GSMA. “But it is not just about adding new types of connections: there is an opportunity for mobile operators to add value far beyond connectivity by developing M2M capabilities that reduce fragmentation and stimulate new services. For example, defining cross-vertical solutions in network APIs, device management, security and big data are areas where operators can help drive the M2M market forwards.”

According to the study, around 428 mobile operators currently offer M2M services across 187 countries; this is equivalent to 40 per cent of the world’s mobile operators.

Operators surveyed in the report are now undertaking real commercial M2M deployments, indicating that the market has moved from an early-stage to mass-market delivery phase. Many operators also commented that they are adapting their organisational structures and business models in order to serve a range of vertical industries with M2M solutions.

The report indicated that the automotive industry was one of the fastest-growing M2M markets. Indeed consumers can now benefit from in-car connectivity and services such as flexible usage based Pay-as-You-Drive (PAYD) insurance and real-time traffic management. 

“It is clear that the M2M market has moved from a period of development towards a commercial deployment phase,” said Jurgen Hase, Vice President M2M Competence Center, Deutsche Telekom. “M2M is of significant strategic importance to our business with huge growth potential across a number of industry segments. We can already see the impact it is having on our everyday lives.”

“M2M matters because it rearranges workflows to be more frictionless. Increasingly we at SingTel are focusing on solutions that create more value for our customers beyond connectivity. We are looking at different ways to deepen our offering,” said Mr Zia Zaman, Vice President, Emerging Businesses and Strategy, SingTel Group Enterprise. “Initially our efforts were focused on making sure we were providing excellent connectivity. Now that has been achieved we are focusing on moving up the value chain.”

“Our customers are becoming more sophisticated in their use of M2M technology and more aware of the opportunities it creates.  We believe that by aligning ourselves with their approach to the market we are creating new and stronger partnerships to help expand the adoption and use of M2M globally,” Jari Salminen, M2M business development at Vodafone.

Tags: M2M, GSMA, mobility