Description of the Report:
This report analyses the overriding trends and changes taking place in the M2M market around the globe. It explores the driving forces behind the market’s growth and transformation, including an examination of the chief market trends, plus volume and value forecasts up to 2017 by geographical area (Europe, Asia Pacific, North America and Latin America), by country (13 countries including Australia, Brazil, Canada, China, EU5, Japan, Russia, Turkey and USA).
It also presents the quantitative evolution of the M2M modules, by application and by networking technologies (cellular, wireless and fixed). It also shows the evolution of the different underlying cellular technologies evolution (2G/3G and 4G).

Description of the Database:
This database includes M2M market volume and value forecasts up to 2017 by geographical area (Europe, Asia Pacific, North America and Latin America), by country (13 countries including Australia, Brazil, Canada, China, EU5, Japan, Russia, Turkey and USA). It presents the quantitative evolution of the M2M modules, by application and by networking technologies (cellular, wireless and fixed) and shows the evolution of the different underlying cellular technologies evolution (2G/3G and 4G).

Region:
World,Asia-Pacific,Europe,Latin America,North America,Australia,Brazil,Canada,China,China,France,Germany,Italy,Japan,Russia,Spain,Turkey,United Kingdom,USA,USA

This study includes the delivery of:
- a report
- a slideshow
- a database

Methodology:

The approach adopted by the IDATE team of analysts and consultants is based on the combination of several methods:
• Field research and validation of field research data;
• Conventional tools used in industry and market analysis: segmentation, competition analysis, strategic strengths, modelling and assessment and forecasts, amongst others;
• Expert analysis of field specialists and their professional network partners.

More specifically, IDATE can call on the following human resources and tools:
1/ A multidisciplinary team of full-time consultants, specialised by business sector
IDATE analyses are performed primarily by our in-house consultants, and very occasionally by freelance market analysts. This approach capitalises on our pool of expertise through teamwork, and the constant sharing of knowledge, ideas, contacts, viewpoints and key data.
Each report is drafted by a team of specialists under the direct supervision of senior consultants who are recognised experts in their field.
2/ Primary and secondary research
IDATE reports and databases are based on primary data obtained from first-hand interviews with the sector’s decision makers, and on secondary data assembled from public sources and external databases.
3/ An integrated information centre sustained by a number of tools and proprietary databases
Over the course of 30 years, IDATE has developed proprietary work methods, data structures and databases that trace the history of major developments in the sectors under study.
• Companies: The IDATE in-house data service tracks the latest news and events concerning the leading telecom, Internet and media industry companies around the globe. Innovative firms and start-ups are monitored by the market experts in the different ‘Practices’.
• Markets: IDATE databases are developed using rigorous methods to process major economic indicators (GDP, investment, exchange rates and demographics) and relate them to influential sectoral and national factors such as capex and national market dynamics).
• Technologies: IDATE has a practice-based organisation structure which enables us to track innovation efficiently. IDATE engineers ensure an in-depth understanding of the changing shapes of products and services and of the latest innovations in the marketplace.

4/ Contents of published reports
Each IDATE market report details the structures and issues at play in the market under study, the driving forces (technologies, regulation, and consumption) and the players involved. Particular emphasis is placed on market assessments and forecasts, which are developed within the framework of a core scenario. Every market report features a clear and concise presentation illustrated with tables and graphs of key market data and trends.

The drafting process of a market report is based on the following steps:
• analysis of the information available in the in-house databases, and review of analyses performed in the recent past;
• based on a preliminary segmentation and assessment of the market, and as part of an validated interview guide, analysts conduct interviews that enable them to validate working hypotheses;
• a market model is then developed, to enable testing of the hypotheses which impact market development, and the model is validated after a new round of interviews;
• and, finally, report conclusions are debated within the team responsible for the project and with expert consultants from the various fields involved;
• proofreading and editing/revision processes, prior to the editing of the final version of the report which is delivered to the client.

Report coverage

There is no single industry definition of ‘Machine-To-Machine’, more commonly referred to as M2M.

The definition used for M2M in this report will be the one that covers the concept of ‘communicating devices’. M2M refers to automated communications (both programmed and/or triggered by a man-induced event) that involve at least one remote device which is not a commonly-used information device such as a computer, telephone or TV. This, therefore, involves exchanges between several machines without any human intervention in the chain of communication. An application or service can also be called M2M if it involves communication with at least one machine whose primary feature or value is not communication and/or Internet access, and can thus work without any network connection, as with a car or a meter. In that sense, M2M can include consumer electronics (CE) applications where connectivity is not the primary value. Here, connectivity is seen as an enabler of such CE applications as e-readers or connected Portable Navigation Devices (PND). However, netbooks and mobile devices such as the iPad are excluded.
M2M is not, itself, a technology, but rather a logical combination of different technologies based on electronics (such as sensors, RFID and modems), telecommunications (as with GPRS, WiFi, SMS and Internet) and computing (of the likes of XML and information systems), all of which makes it possible to build new services. Here, the M2M scope is restricted to cellular M2M.
M2M solutions allow a central server (operated automatically or manually) to communicate with a group of distant machines, via a private, public or operated access network. The purpose generally is to capture data that is stored on the machine and/or to send data to alter the state of the machine. Remote monitoring enabled by M2M can involve the machine itself, a person (equipped with a device) or an object. Whilst this report speaks primarily of machines, the term could in fact refer to an indicator (such as temperature or speed), a person or an object become a communicating device by the addition of sensors or ID components.
This report provides market and data analysis, but does not focus on the technology itself. Additionally, it does not cover the Internet of Things. A dedicated report on the topic ‘RFID and Internet of Things’ is currently available at the IDATE bookstore.


Market segmentation

Like any market, M2M technology offers specific solutions to various industries or vertical markets. The main industries involved in M2M technology are presented in the following table, which shows that segmentation is primarily vertical.

Security
Description of service:
Abnormal situation detection
Homeland security
Maritime security
Examples of applications :
Surveillance
Alerts
Diagnostics

Energy
Description of service:
Remotely collect data on flow rate, pressure, temperature, tank level and equipment status as an alternative to manual, on-site data collection
Energy distribution (pipeline surveillance)
Examples of applications :
AMR

Transport
Description of service:
Tracking
Telematics services
Examples of applications :
Fleet management
Emergency alerts on vehicles
Toll booth payment via automatic identification
Maritime tracking

Commerce
Description of service:
Monetics
Examples of applications :
e-payment
Point of sale (PoS)
Connection to automatic teller machines (ATM)
Virtual wallet solutions (such as FeliCa)

Automotive
Description of service:
Customised insurance rate
Telematics services
Infotainment
Examples of applications :
‘Pay-as-you-drive’ model
Remote diagnostic
Mobile video and mobile Internet services

Home Automation
Description of service:
Remote applications normally using short-range technologies
Examples of applications :
Surveillance
Remote programming
Energy management

Healthcare / Wellness
Description of service:
Essentially dedicated to patients
Examples of applications :
Blood pressure
Glucose level

Consumer electronics
Description of service:
Connectivity agnosticism for endusers (B2B2C)
Examples of applications :
Photo frame
e-readers
Connected PND

M2M products can also be categorised under the following main applications:

•?Surveillance: The goal here is to ensure the security of a ‘site’, either buildings or a given category of mobile individuals (such as children, patients or prisoners) who may pose certain risks, either to themselves or to others. The information that is communicated is generally very basic, mostly a location and/or an alert if a threshold such as a specific perimeter is reached
• Fleet management: Based in large part on global positioning packages, these solutions enable (usually real-time) tracking of the position of objects or mobile equipment. The goal then is to have real-time control over locations and to be able to optimise travel and routes.
• Remote monitoring: These solutions – mostly one-way communication systems from the machine to the server – can serve several purposes. For vendors or machine installers in an open environment (at customer premises, for example), the goal is chiefly one of preventive maintenance for their customers. They can thus be alerted to technical problems with the machines through an alert system. For uses in a closed environment, coupled with maintenance in some cases (which the company does not necessarily handle directly), the main goal is to ensure operational control over the fleet of machines (rate of operation, raw material consumption), and to gather commercial data, particularly on consumption related to the machine, either at regular intervals or when an alert threshold has been exceeded.
• Info mobility: While other systems mostly retrieve information from the machine and dispatch it to the central server, these solutions look for the relevant part of the mass of information that is available on the Web (public or private databases) that can be associated with a product in a mobility context.
• Monetics: These solutions make it possible to automate financial streams either in full or partially, generally from a company’s distant site to a financial institution or a customer account. These are usually replacements for existing payment solutions, and they are generally implemented to save time and process more customers.

Other main segmentations include:
• Geography: the market is typically different for each geographical region (US, Asia, Europe) even if offerings have to be international or trans-regional in nature as applications are spread worldwide, often in mobile contexts. This demands specific solutions. Indeed, some usages differ from location to location throughout the world. For instance, mobile payment is definitely more widespread in Asia (notably Korea and Japan) and pricing and package typologies are thus completely different from European ones.
• Networking technology: multiple technologies are used in M2M, more or less meeting vertical requirements. In this report, IDATE focuses on wireless technologies only. For instance, home automation applications will primarily use short-range technologies whereas homeland security will favour satellite communications. However, cellular technologies (2G and 3G) remain widespread.

Market assessment and forecasts

IDATE forecasts are based on:
• Primary data gathering worldwide, through desk research and dozens of interviews with the major module manufacturers and mobile operators.
• Market models that isolate key service consumption parameters and service pricing assumption.

Data for estimates and forecasts (from 2008 to 2017) is segmented by:
• geographical area,
• country
• M2M building blocks (hardware, software, connectivity).

Table Of Contents

Contents

1. Executive Summary 7

1.1. Continuous growth in M2M market 8
1.2. Automotive, consumer electronics and utilities verticals will drive M2M market 9
1.3. M2M players seeking business opportunity beyond their core expertise 10

2. Methodology 11

2.1. General approach 11
2.2. Report coverage 12
2.3. Market segmentation 13
2.4. Market assessment and forecasts 14

3. Key underlying technologies 15

3.1. M2M architecture 15
3.2. Standardization 17
3.3. Communication technologies 18
3.3.1. Numbering issues 18
3.3.2. Addressing technologies 19
3.3.3. Mobile Networking technologies 20
3.3.4. Wireless technologies 24
3.3.5. Wired technologies 31
3.4. Non communications technologies 34
3.4.1. Service and device management platforms 34
3.4.2. Big data 34

4. Market structure and player strategies 37

4.1. Industry structure 37
4.1.1. Value chain 37
4.1.2. Competition structure / landscape / environment 39
4.2. Business models 40

5. M2M vertical markets 42

5.1. Automotive 44
5.2. Utilities 48
5.3. Security. 50
5.4. Consumer Electronics 53
5.5. Healthcare 55
5.6. Transport 58
5.7. Commerce 60

6. Strategic analysis 62

6.1. General aspects 62
6.1.1. Impact of consumer electronics 62
6.1.2. Security and device management become key in value proposition 62
6.2. Hardware segment 63
6.3. Connectivity segment 70
6.4. IT segment 78

7. Markets and forecasts 85

7.1. Market development factors 85
7.1.1. Analysis of growth drivers 85
7.1.2. Forecast hypotheses 86
7.2. Market forecasts 87
7.2.1. Forecasts 2013-2017 87
7.2.2. Forecasts by country 89
7.2.3. Forecasts by technology 90
7.2.4. Forecasts by application 91
7.2.5. Forecasts by market segment, by platform 92

8. Appendixes 94

8.1. Company profiles 94
8.1.1. Card makers 94
8.1.2. Module manufacturers 96
8.1.3. Telcos and MVNE 100
8.1.4. IT integrators and service providers 115



Tables

Table 1: M2M market segmentation 13
Table 2: Addressing needs and identification in networks 19
Table 3: Comparative features of leading cellular M2M solutions 20
Table 4: Mobile technology specifications 21
Table 5: Module price by technology used 21
Table 6: Level of 3G and LTE adoption at the end of 2012 (in terms of subscribers) 22
Table 7: Level of 4G adoption (in terms of subscriptions) 22
Table 8: Features of main short range technologies 27
Table 9: Main acquisitions in M2M space 39
Table 10: Comparison of key elements in standard and M2M operator business models 40
Table 11: M2M developments, by vertical market. 43
Table 12: Main applications in the automotive industry 44
Table 13: Summary of key elements for telematic development 46
Table 14: Car makers strategy regarding module implementation 47
Table 15: Volume expectations. 47
Table 16: Main applications in the utility industry 48
Table 17: Development prospects in the utility industry 50
Table 18: Main applications in the security industry 51
Table 19: Development prospects in the security industry 52
Table 20: Main applications in the consumer electronics industry 54
Table 21: Development prospects in the consumer electronics industry 55
Table 22: Main applications in the healthcare industry 56
Table 23: Development prospects in the healthcare industry 57
Table 24: Main applications in the transport industry 58
Table 25: Development prospects in the transport industry 59
Table 26: Main applications in the commerce industry 60
Table 27: Development prospects in the commerce industry 61
Table 28: Market landscape for module vendors 63
Table 29: M2M revenues of largest M2M module makers, 2012 66
Table 30: Main acquisitions in M2M module space 67
Table 31: Module price by technology used 67
Table 32: Module maker positioning 68
Table 33: Module manufacturer acquisitions in the platform market 69
Table 34: Sierra Wireless revenues by product line 70
Table 35: Market landscape for MVNE 70
Table 36: Market landscape for network operators 71
Table 37: Main features of competing technologies 72
Table 38: Application features including usage and ARPU 73
Table 39: Bandwidth required by M2M application 75
Table 40: List of carriers with single point of contact 76
Table 41: Carrier positioning 77
Table 42: Market landscape for integrators, service providers and software players 78
Table 43: Different alliance memberships 79
Table 44: Main platform description 80
Table 45: ATandT (end of year) wireless segment, in millions 101
Table 46: 2Q13 net add summary (in thousands) 101
Table 47: T-mobile M2M subscriptions 103
Table 48: Vodafone product offering 112
Table 49: Verizon spectrum of sales models 113



Figures

Figure 1: World cellular M2M markets 7
Figure 2: Architecture of an M2M solution 15
Figure 3: Main objective of OneM2M 17
Figure 4: Main benefits of OneM2M 18
Figure 5: Low cost LTE standardization roadmap 23
Figure 6: Vodafone roadmap for MTC-based LTE 24
Figure 7: Overview of a Personal Area Network ecosystem 25
Figure 8: Main technologies in use according to bandwidth (in Mbps) and reach 26
Figure 9: Wireless M-Bus technology ecosystem 27
Figure 10: Key differentiators of SigFox, compared to the competition 29
Figure 11: Deployment roadmap (2012 in blue, 2013 in green on the left picture) 30
Figure 12: Digital dividend spectrum 31
Figure 13: Home by SFR solution 32
Figure 14: Jasper Wireless global platform 34
Figure 15: Various kinds of data sources 35
Figure 16: Smart machine value chain 37
Figure 17: M2M development by vertical industry 42
Figure 18: ECall operating principle 45
Figure 19: M2M platform by ZTE 64
Figure 20: Internet of Things connectivity platform 65
Figure 21: Cisco's strategy towards the Internet of Everything 65
Figure 22: Operating principle of Sierra Wireless platform 69
Figure 23: QoS strategy at Telenor 73
Figure 24: Cloud M2M strategy at T-Mobile 77
Figure 25: Map of Jasper presence 79
Figure 26: Global coverage with unmatched European footprint 80
Figure 27: T-Mobile strategy towards the cloud and big data 83
Figure 28: World M2M markets 87
Figure 29: World Cellular M2M markets 88
Figure 30: World Cellular M2M markets 88
Figure 31: Cellular module evolution, by country 89
Figure 32: Cellular module CAGR 2012/2017, by country 89
Figure 33: M2M module evolution, by technology 90
Figure 34: Cellular module evolution, by technology 91
Figure 35: M2M module evolution, by vertical 91
Figure 36: Worldwide cellular connectivity revenues 92
Figure 37: Share of cellular M2M revenues in mobile data revenues in Europe 92
Figure 38: Worldwide Software and IT services revenues 93
Figure 39: Cellular M2M module market 93
Figure 40: Android-based car rear-view mirror 97
Figure 41: AirVantage product description 98
Figure 42: ATandT M2M offering 101
Figure 43: GM and ATandT alliance 102
Figure 44: T-Mobile strategy 104
Figure 45: Orange KPIs for 2012 105
Figure 46: NTT DOCOMO approach to M2M, providing device, network and service 106
Figure 47: Telenor value proposition 110
Figure 48: Number of M2M connections at Vodafone 111
Figure 49: Jasper positioning 116

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