Globally, the cellular M2M market is growing steadily and is on track to reach 315 million connections by the end of 2015. But connections are not necessarily the most important metric to judge the industry (or its participants) by, as the value of a single connection will vary dramatically depending on what it is being used for. Similarly, cellular is not the be-all and end-all of M2M.
Segmenting the world’s M2M connections by bearer is pointless, however. For the M2M market is not defined by “winners” and “losers”. Instead it is concerned with the application of the correct technology for each respective use case and/or business model. Many of these will make use of multiple bearers, placing different ones at different points in the data communication chain.
Not everything requires or can support individually paid-for point-to-point connectivity, so cellular is not universally applicable. But this is not to cellular’s detriment; on the contrary, it serves to underscore its importance. For cellular as a bearer occupies a unique position – in that only the most valuable assets and most business-critical connections will make use of it.
Cellular will only be found where the value conferred by its presence more than covers any costs. Therefore, it will be intrinsically associated with those connectivity projects that generate the greatest revenue (be it overall or per connected device), or with the highest-value segments of a particular project. That means that the greatest monetary returns will be found wherever cellular is implemented for M2M.
Annual M2M revenues for operators are anticipated to reach US$ 12.8 billion by 2015, even if their role remains “just” as the connectivity provider. This is a small portion of total mobile network operator revenue, but, as with all business services, the true market value lies downstream in the financial gains made possible for the enterprises that deploy cellular M2M to support their processes, products and services.