M2M (machine-to-machine) services revenues will reach $35 billion globally in 2016, according to a May 2011 white paper from Juniper Research. Data from “M2M – Connecting the Devices” indicates Western Europe will represent the largest regional M2M services marketplace at that time, followed by North America and then Far East/China.
European, Latin American Markets Follow Leaders
Central/Eastern Europe and Latin America will represent roughly equivalent smaller markets, followed by slivers of business in the Indian Subcontinent, rest of Asia/Pacific, and Africa/Middle East. Within the Far East, Juniper expects Japan and South Korea to become particularly strong M2M service markets.
At its simplest, Juniper says “M2M” refers to machine to machine or machine to mobile communications, that is the use of networks to transfer data from machines rather than individuals. In practice, Juniper says implicit in the M2M concept is the idea that such communication allows for analysis of data which passes through the M2M network, providing a significant value-add.
Efficiency, Savings Support Biz Case
Juniper analysis indicates two pillars support the business case for M2M from the “end user” perspective: increased efficiency, on one hand, and cost savings on the other. Nevertheless, Juniper advises that M2M continues to be hampered by the complex nature of M2M rollouts, long lead times and low ARPU. In addition, M2M needs to be considered as a business which is related, but not identical to, the standard cellular business of connecting subscribers.
M2M Stakeholders Vary
Juniper analysis suggests the stakeholders within the M2M value chain vary from SIM and module manufacturers to operators and service providers, and encompass a variety of companies offering different degrees of service along the way.
Hardware aside, Juniper says there is an increasing realization that the complexities of deploying long-lasting M2M projects across multiple different industries call for a level of attention that operators themselves may not be able to or want to offer. Within the M2M value chain, therefore, Juniper advises there is room for M2M “enablers,” or specialists which bridge the gap between the connectivity and the provision of a complex M2M service using that connectivity.
Leading M2M Industries
According to Juniper estimates published in February 2010, the following industries, in order, will lead the M2M marketplace:
- Connected buildings: site and building management, monitoring and security.
- Mobile connected smart readers.
- Consumer vehicles with onboard M2M systems.
- Commercial telematics: mobile connected vehicles.
- Healthcare – monitored individuals.