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New Business Models Drive M2M Technology Revenue for CSPs

By Ashok Bindra September 25, 2012

Today’s digital lifestyles increasingly rely on communications between machines. Hence, industries like automotive, utilities, healthcare and agriculture have started adopting machine-to-machine (M2M) communications to reduce operational cost, improve productivity and enhance the customer experience, according to David Ranjit William of Aricent Group, in an opinion column for RCRWireless.

William’s column presented M2M revenue growth data gathered by market research firm Machina Research. It predicts that M2M revenue will grow to more than $750 billion by 2020, with the United States and China being the biggest adopters.

The Aricent Group executive also indicated that communication service providers (CSP) will play a pivotal role in the delivery of M2M services as they provide connectivity for M2M solutions. According to Forrester Research, global connectivity revenue will account for $17 billion by 2016.

However, Forrester’s study shows that during the same period, fixed line and voice revenue erosion will be around $116 billion.

To bridge this fiscal gap, according to William, CSPs are adopting new business models to become M2M solution providers. Thus, CSPs have the ability to provide cross industry analytics to move up the value chain.

Meanwhile, as CSPs change their existing business models, they should also define the industry segments they will pursue, as they may not have the necessary domain expertise to address all industry segments.

“As industries intersect e.g. energy and automotive, mobile and finance, etc., CSPs could extend their OSS/BSS capabilities to support more communication enabled industries,” wrote William.

Some of these examples include extension of billing for utilities, remote management of devices, delivery of content, and communication management for M2M devices.

To deliver end-to-end M2M solutions, the research firm Machina Research is predicting the emergence of CSP alliances. The columnist also indicates that CSPs have access to M2M specific data and are best positioned to perform analytics on data from different industry solutions, providing them with the ability to create more meaningful cross industry value added services.

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Edited by Braden Becker

IoTevolutionworld Contributor

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