M2M service revenue will double to $31 billion in 2017: Infonetics

Global M2M (machine to machine) service revenue will more than double between 2012 and 2017, from under $15 billion to $31 billion, said Infonetics Research.

M2M is one of the fastest-growing major new segments for telecom service providers.

There were nearly 1.4 billion M2M connections worldwide in 2012, with PAN wireless technologies comprising the vast majority.

On Tuesday, GE, Cisco and AT&T announced a major M2M deal.

Making up just under 190 million connections today, M2M connections via cellular and other WAN wireless technologies are projected to nearly triple by 2017, becoming the largest growth engine for operator revenue, said Infonetics Research in its report called M2M Connections and Services.

More than 16 percent of total M2M service revenue, almost $2.4 billion, is derived from M2M backhaul services.

Infonetics forecasts M2M services to hit $31 billion, M2M connections to top 4 billion by 2017
The automotive, transport, and logistics sector made up 1/3 of total M2M service revenue in 2012, driven by vehicle tracking, navigation, and delivery applications.

Godfrey Chua, who directs Infonetics Research’s M2M and Connected World program, said: “What’s often overlooked about M2M is that it will be delivered to the world by way of a portfolio of access technologies.”

Cellular networks represent the most meaningful revenue opportunity for operators, but by far the most popular way to connect to M2M services is via PAN (personal area network) wireless technologies, such as Wi-Fi, Zigbee, Bluetooth, and IP500, which do not generate connection revenue. It’s critical that mobile operators incorporate a broader view of the various M2M access technologies into their M2M strategies.

North America and Europe are the key centers of M2M service growth, together accounting for 72 percent of the total market.

In 2012, China Mobile overtook AT&T in M2M connections leadership, but AT&T remains the revenue leader due to higher ARPC (average revenue per connection).

[email protected]