M2M Opportunity Widens

3/26/2012


M2M (machine-to-machine) may be all about the data, but that also means it’s all about the services. As the number of connected devices gathering data grows, more services will be needed to make sense of that information and ease the path to connectivity for both businesses and consumers.

Telecommunications companies are often engaged in a battle against commoditization. They need to find the value they can offer to customers, and increasingly this is coming from M2M solutions and services. According to Frost & Sullivan, www.frost.com, M2M revenue from non-connectivity sources in Europe amounted to 3% of the total in 2010, and 4.2% in 2011. By 2017, this portion is expected to rise to 20%.

Frost & Sullivan says monetizing the data from M2M applications will be a key driver to enable that level of growth. And the research firm sees a lot of the opportunity coming on the consumer side of the business. For instance, consumer M2M applications such as ereaders and connected digital photo frames are close to telecommunications firms’ core capabilities. While much of the focus in M2M has traditionally been in industries such as energy, transportation, healthcare, and security, consumer products present a strong area of potential.


While this has been a trend in the marketplace for some time, Frost & Sullivan says telcos worldwide are starting to really see the full opportunity in consumer devices.

“This trend has a long growth path as more smart or connected devices become available in the future,” says Frost & Sullivan Senior Industry Analyst, YiruZhong. “There is also increased uptake of consumer-grade industrial devices such as personal home wellbeing/healthcare devices and personal navigation devices.”

We have seen that the number of wireless connections will likely skyrocket, soon reaching a point of97.5 wireless connections for every 100 people globally in 2016.

As a wide range of consumer connected devices continue to reach the market, the opportunity for collecting data on consumer usage will surge. By integrating this data into a variety of services, companies will be able to put it to use to create even better offerings.





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