M2M stands for “machine-to-machine” communications. Essentially, it is the exchange of data between a remote machine and a back-end IT infrastructure. The transfer of data can be two-way:
||Uplink to collect product and usage information|
|•||Downlink to send instructions or software updates, or to remotely monitor equipment.
In the past, the high cost of deploying M2M technology made it the exclusive domain of large organizations that could afford to build and maintain their own dedicated data networks. Today, the widespread adoption of cellular technology has made wireless M2M technology available to manufacturers all over the world.
As shown below, wireless M2M applications include connectivity-enabled devices that use a cellular data link to communicate with the computer server. A database to store collected data and a software application that allows the data to be analyzed, reported, and acted upon are also key components of a successful end-to-end solution.
As RIM has demonstrated in the PDA business, connectivity can transform an industry and generate tremendous value. With connectivity, traditional hardware makers currently earning margins on a one-time, per-device basis can realize new recurring revenue and profit streams. Connected device providers can also reduce or eliminate support costs by allowing their connected machines to be serviced remotely. The ability for any device or machine to communicate wirelessly—not just cell phones and PDAs—enables value beyond what we can even imagine today.
Through connectivity, new value, new products, and new applications that were not possible even a few years ago are being brought to market as manufacturers realize enormous benefits from their ability to:
||Create new recurring revenues from ongoing services|
|•||Develop whole new product lines that rely on real-time two-way connectivity|
|•||Perform diagnostics and repairs remotely
|•||Monitor machine status and usage in real time|
|•||Increase profitability by lowering service costs and improving product performance|
As a result of this value, there is significant growth in the adoption of M2M communications across many industries. There is high demand for connected consumer electronics such as PNDs, netbooks/tablets and e-readers. Industrial segments use M2M connectivity for equipment monitoring, fleet management and supply chain optimization. Large utilities implementing smart grid/metering programs to comply with government mandates or serve green initiatives require M2M connectivity. Plus, there’s a lot of recent growth in business-to-consumer opportunities such as home health care, automotive telematics, and home energy/security applications.
According to a Current Analysis research report, forecasts for the revenue opportunity vary but most operators and analysts expect that compound growth rates over the next five years will be in the 25%+ range, with estimates of the numbers of devices to be connected ranging from 200 million to 1 billion world-wide by the end of 2014.
Jasper Wireless partners with the world’s leading mobile operators enabling those operators and their customer companies to capitalize on the global opportunity in machine-to-machine and embedded wireless.