Comms Business predicts that in the next twelve months we are going to see Machine to Machine (M2M), and the Internet of Things (IoT), solutions explode in our market. Resellers have been slow to adopt the technologies thus far but that is starting to change. Here, Philippe Vigneau spoke to Comms Business about where Transatel see the M2M market.
Comms Business (CB): As it stands, what is your view of the M2M market and how will the Channel fit in with that view?
Philippe Vigneau (PV): Segments with obvious optimisations like fleet management are now well developed, and new segments are rising like security and medical because connectivity and module prices going down quickly. The frontier with the Internet of things is blurring and m2m offers need to comply with new models including data usage patterns that are less predictable because of human actions. The true challenge is connecting devices globally, of which our expertise is of value for companies wanting to enter the market.
CB:What type of solutions are currently available and being actively sold by resellers?
PV: The aggregation model where the M2M provider is seen as a connectivity operator bundling applications, hardware and connectivity is very successful.
For example, we have a medical device manufacturer that enables medical distributors to remotely follow the bugs of the device and also allows Doctors to remotely configure the devices. In that case the manufacturer is selling the airtime and is adding revenue on top of its hardware and applications margins.
Our recent development around global connectivity was welcomed by the market which has been waiting for a true multi country solution with local 2G/3G/LTE tariffs. It’s the result of our expertise around our core network and international connectivity that drives interest and differentiates Transatel.
CB: Does the Channel get M2M/ IoT? How much education is there still to be done?
PV: We observe that for the Channel and the rest of Europe m2m projects are longer than initially planned. It often takes over a year to deploy a new service because customers are willing to develop in-house a lot of things which is not always the optimum way. For example we provide our core network as managed services, there is no reason for large integrators to redevelop such architecture. The economic efficiency and the time to market allowed by our solution is convincing automotive brands and integrators to use our core network and resources instead of redeveloping everything. Customers also believe that they will be locked for 10 years with a Mobile Network Operator but today our technology can bring lot of flexibility regarding the relationship with operators.
CB: How big is the M2M/ IoT opportunity? What should resellers wanting to explore this area be doing?
PV: The opportunity is a bit overwhelming because the market is highly fragmented. We strongly believe that successful resellers are the ones bundling a full service. That means they can adapt their connectivity offer to their application and hardware to present a packaged offer to the customer. They also need to start asking questions about SIM cards earlier in the product development process. We see a lot of projects where everything has been developed without taking into account the connectivity or based on preconceived ideas about the connectivity price structure. It’s very often a loss of time and connectivity providers are more flexible than usually thought.
CB: What margins can resellers expect from selling M2M solutions?
PV: Considering the level of fragmentation, there is a wide range of answers. Once again the successful and profitable providers have packaged offers bundling SIM card, application and hardware. They benefit from continuous cost optimisation at the three levels.
CB: How do you see the M2M/ IoT market evolving over the next 12 -18 months?
PV: Global Consumer Electronics brands are releasing connected products that are leading to a raise in public awareness on IoT. Now that 3G/4G global solutions like ours are available on the market, we are expecting a step change in demand for M2M products and services. This will attract new segments towards 3G/4G : today it’s the case for tablets, but 3G watches and extreme sports cameras and a whole host of connected devices are next.