M2M data to boost telecom provider VAS revenue in 2012: Frost

Telecom Lead Europe: According to Frost & Sullivan,
2012 is expected to be a year when telecom providers in Europe will begin
developing consumer machine to machine (M2M) opportunities in addition to their
current enterprise focus.

Monetising M2M data will be one of the key drivers for
such an aggressive growth forecast.

Telecommunication companies are looking to diversify
their M2M offerings beyond what can easily become a commoditized connectivity.
According to Frost, companies with a strong consumer brand and deep consumer
digital offering could most readily capture this approach.

The research agency found the ratio between M2M non
connectivity revenue and total M2M revenue in Europe amounted to 3.0
percent in 2010 and 4.2 percent in 2011.  This proportion is expected to
grow significantly to more than 20 percent by 2017.

Consumer M2M applications – centered on small/portable
consumer electronics devices such as e-readers and digital connected photo-frames – are the closest to telcos’ core capabilities of providing digital lifestyle

Though telcos in Europe are currently pursuing
the immediate enterprise M2M opportunities in industries such as utilities,
automotive, security/surveillance and healthcare, they do see market potential
in consumer electronics due to wide adoption of smart connected devices.

 “In addition, this trend has a long growth
path as more smart or connected devices become available in the future,”
according to Frost & Sullivan analyst Yiru Zhong. “There is also
increased uptake of consumer-grade industrial devices such as personal home
wellbeing/healthcare devices and personal navigation devices.”

This expansion will also create accumulation of M2M data
about consumer usage. Integrating this data into the telcos overall customer
analytics will contribute to service deployments and customer improvements. 

To speed up market deployment telcos have to first
upgrade their data analytics capabilities and data warehousing integrations.
This is already being addressed though, particularly as M2M will also create
significant volumes of usable data from a variety of different resources.

The second obstacle, according to Frost, is a suspicion
of big brother society. Europe’s sensitivity to data privacy makes it
difficult for the public to distinguish between an identified individual and an
anonymous group of customer segment with similar characteristics.  Telcos
can address this concern by always ensuring customer’s choice and consent.

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