M2M Revenue Potential Needs Prioritizing to Stimulate Growth, says Frost & Sullivan

By Jody Ray Bennett February 06, 2013

Despite attempts at optimising their machine-to-machine (M2M) strategies, many telecom companies are looking for new and innovative ways to encourage revenue growth. According to Senior Industry Analyst at Frost & Sullivan, Yiru Zhong, M2M for small and medium-sized enterprises must be made a priority, explaining that such outreach can lead to a more sustainable revenue stream overall.

Growth estimates for such a broad M2M strategy hit around 22.3 percent in the next five years, for Frost & Sullivan, as the functions of the service and the needs of the users change.

Second on Frost & Sullivan’s list of priorities, according to Yahoo, is the development of its customers’ needs in non-traditional areas. Zhong explains that such opportunities exist at both retail and government levels, when smart electricity meters and E-call compliant cars are concerned.

New competitors in the field are also set to benefit the M2M market, as mobile virtual network operators and wholesale M2M telecom service providers accelerate market research, innovation and development.

A significant obstacle in the way of unbridled development over the next year is in the area of M2M connectivity roaming, in particular when small to medium-sized enterprises are concerned. Zhong hopes this issue is brought to the attention of national regulatory bodies and a coordinated effort is made to transcend national boundaries in this regard.

Additional obstacles standing in the way of M2M market development include the targeting of small- to medium-sized enterprises by service providers, or lack thereof. Zhong believes that while Deutsche Telekom’s M2M Marketplace approach is a decent place to begin, the gap between potential and actual contracts is still too wide to bridge without simple, plug-and-play solutions.

The standardization of M2M module protocols and connectivity platforms, as well as application software protocols to devices, is also very important to market growth. A difficulty exists in getting industry leaders to agree on what such a standard might be, however, and Frost & Sullivan remains pessimistic.

Edited by Braden Becker

IoTevolutionworld Contributing Writer

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