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M2M set to grow, albeit with proper support

Machine to machine will change the way we share knowledge and information. User-intervention and smart devices will take the M2M technology further

M2M set to grow, albeit with proper support
M2M <a href="http://www.shutterstock.com/pic-152433065/stock-photo-machine-to-machine-m-m-conceptual-wallpaper.html">image</a> via Shutterstock.com
Prerna Raturi
Last Updated : Sep 11 2013 | 5:21 PM IST
As a concept, machine to machine (M2M) is set to be the next big thing in the telecom sector. Not only does the Indian consumer have 3G and 4G experience, the Indian telecom market is one of the fastest growing in the world. In such a scenario, telecom companies are realising the importance of the machine to machine (M2M) market, which is growing at a fast pace on a global scale.  

According to Machina Research, a technology research and consulting firm focused on emerging opportunities associated with new forms of connected devices, the number of M2M connections the world over will grow from 2 billion at the end of 2011, to 18 billion by 2022. According to the research, the trend is driven by consumer electronics and intelligent building sectors, which account for 70 per cent of the total share.

For the uninitiated, M2M is a concept that talks about how different devices are connected to transmit and share data remotely over a network, which can either be fixed wire or wireless. Used most commonly for functions where data needs to be collected from remote sources, M2M today is used for several applications that can connect mechanical, electronic or electrical machines over different kinds of network. For instance, remote monitoring for alarm management and emergencies, wireless in healthcare sector, remote payment in home banking scenarios, remote control in management, remote data collection in machines and manufacturing units, and telematics in navigation and transport.

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The M2M technology helps both wireless and wired systems to connect and communicate with other devices that have the same ability. Some of the ways this technology is being used includes smart cars, metering, remote management, data collection on an industrial level as well as connected homes. In fact, a Gartner study estimates that the number of connected devices will be nearly 30 billion by 2020.

The technology of M2M means a large market for companies in the telecom sector, especially at a time when a lot of them are struggling to increase their turnover with wafer-thin margins and a plateauing of growth in the traditional services offered. In fact, according to Cisco estimates, global M2M traffic is set to increase 24 times from 2012-17, with a CAGR of 89.

Of the M2M market, the Machina Research study says that the largest growth will be in the services area, especially around software as a service (SaaS). With more and more companies realising the importance and benefits of M2M and the concept gaining popularity, however, experts also predict possible challenges by way of hardware complexities and network architecture, the limitations of open standards and so on. At the same time, efforts are on to put up open source software and experts are looking at ways to mitigate the hardware hurdles.

Industry figures also indicate that more needs to be done in terms of encouragement of M2M as a concept in the telecom sector. For, the high bandwidth usages such as monitors in healthcare, video surveillance and consumer energy optimisation don’t use M2M as much as they should and thus, the gap between M2M average revenue per user (ARPU) and other telco ARPU seems to be growing.

What is set to help the concept is user-directed intervention with the help of technology such as cloud computing, so that there is an ease of data storage, analysis and knowledge sharing. Smart devices will also play a big role in making the concept more popular in other industry sectors and not just transportation.

According to a paper by Crisil, M2M is most likely to emerge as the next frontier for the telecom industry. These telcos can work on their M2M strategies through a number of ways. For instance, partnerships between module providers, mobile operators, system integrators, manufacturers and the end-consumer, can help the ideal M2M scenario for a complex ecosystem.

The report by Crisil also talks about the possibility of M&A activity, where telecom companies can develop their M2M offering by acquiring niche players, since the market is highly fragmented. Most importantly, however, there needs to be an emphasis on innovation. Companies in the telecom sector should invest in developing M2M solutions and work with business partners on the demands of the market and then specialise in the areas of demand.

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First Published: Sep 10 2013 | 5:13 PM IST

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