Machine to machine (M2M) communications is a very important component of the Internet of Things (IoT). These modules are going to be connecting and communicating with billions of devices as the technologies continues to grow, and the connection of these devices depends on a robust telecommunication infrastructure capable of delivering increasingly more complex data. While a lot of M2M communication currently takes place using 2G networks, according Godfrey Chua, directing analyst for M2M and the Internet of things at Infonetics Research, long-term evolution (LTE) is going to be fueling the growth in the future.
The growth of LTE is going to expand faster than previous network technology as more countries around the world continue to roll out LTE TDD. This includes China Mobile's massive network as well as Japan, South Korea and Singapore. The Asia Pacific region will make up a third of the total global revenue by 2018, rapidly catching up to Europe and North America. Globally more than 300 LTE networks have been deployed in 2013 and more than 25 countries will auction their networks in 2015.
The growth of LTE in M2M is going to be driven by the connected car industry as more telecommunication and automotive companies continue to collaborate to introduce new services in vehicles.
"The services built upon mobile machine-to-machine (M2M) modules, such as fleet management and connected car, are already a sizeable business and are growing much faster than traditional business lines. We look for the market to accelerate beginning in 2015 as M2M services inflect and module sales shift toward higher-ARPU 3G and 4G systems, ultimately just about doubling to $2.9 billion in 2018," said Chua.
Some of the market highlights of M2M modules are:
- In 2013, the global mobileM2M module market totaled $1.4 billion, up 6 percent from the previous year
- 2G comprises the majority of units shipped in 2013, but there is a shift toward broadband technologies and Infonetics expects 3G to grow to 67 percent of mobile M2M module revenue by 2018
- LTE growth will reach compound annual growth rate (CAGR) of 144 percent by 2018
- The dominant M2M module vendors are Sierra Wireless, Gemalto/Cinterion, and Telit accounting for nearly two-thirds of total market revenue, but Chinese vendors Huawei and ZTE increasing the presence in emerging markets in Asia and other parts of the world.
The global spending on wireless M2M technology is expected to reach nearly $200 billion by the end of 2014, and as telecoms reach saturation points with voice services this sector is increasingly becoming the go to market. The M2M value chain has seen many new innovative offerings including submarkets in M2M network security, Connected Device Platforms (CDP) and M2M application platforms.
Edited by
Rachel Ramsey
