Cellular modules for M2M communications
related market-research findings in 2010
As per IMS latest study the shipments of cellular modules
for machine-to-machine (M2M) communications will reach over
100 million in 2015. Dropping module prices, reduced connectivity
rates from carriers, and increased availability of cellular
networks worldwide are all key drivers behind this growth,
says IMS.
Josh Builta, IMS Research Market Analyst and author of
the study states, "One of the greatest underlying strengths
of the cellular module market is the modules are increasingly
being utilized in a wide-variety of M2M applications. Diverse
industries, ranging from metering to digital signage, are
becoming more reliant on cellular technology as a means
to transmit vital information. The cumulative effect of
increased uptake in so many markets will result in total
cellular M2M module shipments growing at over a 24% CAGR
throughout the forecast period."
IMS Research does not expect this growth will be evenly
spread among all vertical markets though. "Given the
assorted nature of these markets, different factors will
drive or inhibit the growth of cellular M2M within each,"
states Builta. Certain vertical markets appear likely to
emerge as the forerunners in the use of cellular M2M as
they will be driven by government driven mandates. Builta
continues, "Probably the best example is the automotive
industry, in which stolen vehicle tracking in Brazil and
emergency call systems in Europe are forecast to become
mandatory as a result of government regulations. Pending
legislation in the EU, known as eCall, would be particularly
significant as it would drive the penetration rate of cellular
modules in new vehicles in Europe to 100%." Partially
as a result of these government initiatives, IMS Research
forecasts modules used in automotive market will have a
31% CAGR during the forecast period.
IMS warns while the overall outlook is bright, concerns
over the cost, reliability, and security of cellular technology
will limit uptake of cellular modules in some vertical markets
for the near term. According to IMS ,Markets including security
and factory automation are likely to rely on wired connectivity
as well as alternative wireless options for a good portion
of their M2M communications. At the same time, healthcare,
a market with great potential for cellular modules, must
overcome a series of privacy and liability concerns before
it can reach a larger market size.
Another researcher Berg Insight finds 2% of the mobile
network connections worldwide were used for wireless machine-to-machine
(M2M) communication at the end of 2010. The number of M2M
subscribers increased by 46 % year-on-year to an estimated
81.4 million. In the next five years, the total number of
wireless M2M connections is forecasted to grow at a compound
annual growth rate (CAGR) of 32.0 % to reach 294.1 million
connections in 2015. By that year of the period M2M as a
share of the total number of cellular connections is projected
to reach 4.0 percent.
"M2M and connected devices is now one of the main
drivers behind the growth in mobile subscribers in Europe
and North America", said Tobias Ryberg, Senior Analyst,
Berg Insight. "All of the world's largest telecom operators
now have several million M2M subscribers in their mobile
networks. In Q1-2011, we expect that AT&T will become
the first mobile operators to reach 10 million M2M subscribers
after more than doubling the installed base in the past
12 months, largely thanks to a successful strategy for connected
consumer electronics devices."
According to Mr. Ryberg, mobile operators are facing a
new market landscape where customers no longer have one
or two mobile subscriptions, but up to five or more different
wireless devices. Besides his smartphone and tablet, a technology-savvy
American is likely to own an e-reader and a connected PND,
drive a car with an embedded telematics system and have
a cellular security alarm installed at home. His Scandinavian
compatriot could have a smart electricity meter with embedded
GPRS connectivity; a Frenchman may use a cellular speed
control warning system and an Italian might have installed
a car telematics device from his insurance company. Mr.
Ryberg concludes that these are some glimpses of the future
that will come and predicts that the vast majority of the
world's next five billion mobile connections will be embedded
into consumer devices, machines and sensors.
Other highlights from Berg analysis includes:
1. The US and Japan recorded growth rates of 52 % and 60
% respectively, mainly driven by connected devices
such as e-book readers and digital photo frames. Among the
world regions, Europe maintained
its number one position as the number of M2M subscribers
increased 43 percent to 29.5 million.
North America was up 51 percent to 23.6 million, followed
by Asia-Pacific, growing by 53 percent
to 19.6 million. According to Berg Insight's M2M subscriber
data estimates, AT&T became the
world's largest provider of wireless M2M connectivity services
last year.
2. Reporting 9.3 million subscribers in Q4-2010. The US
operator added 4.7 million machines and consumer
devices with embedded connectivity during 2010, almost doubling
its subscriber base. Meanwhile
the previous market leader Verizon Wireless was demoted
to second place in the US and
worldwide reporting 8.1 million M2M subscribers at end of
2010, despite adding 1.2 million connections
over the year.
3. Berg Insight estimates that Vodafone, which does not
currently disclose its number of M2M subscribers,
ranked third having in the range of 7-8 million connections.
China Mobile was estimated
to be in the fourth place with around 6 million connections,
followed by T-Mobile at approximately
5 million. Telefónica, Telenor, Orange, Sprint and
America Móvil were other top ten players
with 2-4 million connections each.
<Author: Srinivasa Reddy N
