By Emmanuel Routier, Vice President, Global M2M at Orange Business Services
With such high expectations placed on M2M years before the technology had matured, there were questions as to whether it could live up to its perceived potential.
With more than 20 billion devices expected to be online by 2020, the reality is that M2M is not only ready, but the global M2M market is expanding rapidly.
According to Berg Insight, for example, 140 million cellular M2M devices were active globally in 2012.
Meanwhile, the GSMA estimates that global M2M revenues will increase on a compound annual growth rate of 23 percent from 2010 to 2020, reaching €714 billion. This figure can be challenged, for example on definition, but it will in any case be very significant.
We see M2M as an evolutionary process separated into three distinct “phases”.
The first stage is characterised by organisations implementing M2M to improve existing processes, reduce inefficiencies and enable some vertical offerings in fields such as equipment, asset tracking, remote monitoring and fleet management.
There are already a number of organisations, particularly in the B2B space, which are at this stage including the healthcare, manufacturing and transport industries.
M2M has also been applied in less likely places. For example, last year we worked with Nespresso to launch two coffee machines for the hospitality sector, which became the world’s first connected coffee machines.
This first phase of M2M is reaching maturity as the technology improves processes, reduces costs and enables vertical services in a range of sectors.
The second phase is that of a “connected society”, defined by a landscape where people and machines are connected more than before, touching the B2C space.
We are seeing the green shoots in key verticals showing that we have entered that stage.
This begins with the automotive industry where we are observing the rise of the connected vehicle, anticipating a new European Union legislation which imposes On-Board Units on all new European automotive vehicles from 2015 to enable emergency calls with geolocalisation to take place.
It goes on with the healthcare sector, which we envisage will roll out a great variety of M2M services in the coming decade.
It ends with another vertical where growth is envisaged – connected consumer devices, which bring multiple possible use cases such as e-readers, Personal Navigation Devices, pet trackers and connected cameras.
To support such applications, network providers have traditionally offered backbone technologies such as IPv6 IP VPN, a reliable mobile network and global roaming capabilities.
However, today we are building more sophisticated M2M applications where, in some cases, it is at the heart of entire business models.
Enterprises must ensure that their network providers have the capability and understanding to work end-to-end throughout their service infrastructure as opposed to providing backbone services only.
The third phase is that of “virtual things” whereby we will be in a position to interact with everyday life objects, opening the way to information-driven services based on information stored in the cloud.
The main bearer of the service will be the smartphone interacting with digital tags identifying the objects.
Certainly within the next decade, we predict that there will be a paradigm shift towards this phase where “the internet of things”, indeed more a collection of intranets of people, things and machines, will bring simplicity and ultimate comfort to everyday life.
Consider holistically connected media appliances in the home, monitoring devices in health and RFID tags as standard on consumer products.
In some respects, the vision of smart cities has helped create the impetus for innovations that can be potentially rolled-out across communities.
In recent years, we have seen utility companies leveraging M2M to control and monitor energy consumption through smart metering.
We saw this when we launched “m2o city” in the French town of Le Havre, which saw us working with Veolia Water to launch a city wide smart metering offering, allowing the utility firm to automatically read over 100,000 water metres from a single platform, improving services and delivering cost savings too.
It is vital that M2M has a reliable ecosystem and as we move towards M2M applications that span across cities and indeed society, the focus for network providers will shift towards key partnerships with infrastructure providers in delivering this ecosystem.
Today, network providers are already providing the pre-requisite infrastructure required for a number of M2M applications. However, the key challenge is in educating the market, providing standards to enable its proliferation and securing its confidence.
For M2M to be truly holistic for all businesses, it is essential that standards are defined through cross-vertical collaboration and partnerships.
Network providers play a crucial role in bringing together this ecosystem to drive innovations and co-design services with players from other industries.
It would be represent a lack of judgment not to recognise that M2M has progressed beyond the hype at this relatively early stage.
Whilst we do need to be cautious to consider the practicalities of its implementation against technical limitations, overall objectives and indeed its acceptance, it is essential that we do not lose sight of endless possibilities it can offer as the technology evolves.
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