Automotive Telematics and smart energy to drive M2M connectivity services market to touch $35 billion by 2016

By Telecom Lead Team: By the end of 2011,
major mobile operators in North America, Europe, and the Asia-Pacific region
had established M2M business units.

The global market for cumulative cellular
M2M connections will rise from about 110 million connections in 2011 to
approximately 365 million connections by 2016. This represents a compounded
annual growth rate of roughly 27 percent by 2016 and translates to about $35
billion in connectivity services revenue.

The two largest cellular M2M market
segments over the forecast period, by revenue, will be automotive telematics
and smart energy.

Automotive telematics, including
factory-installed systems such as GM’s OnStar service, aftermarket services
such as usage-based insurance, and fleet management systems, will together
represent more than $15.5 billion in 2016.

Smart energy, specifically cellular
connectivity to smart meters and data concentrators, will represent more than
$7.5 billion in 2016.

As mobile operators further develop their
M2M service offerings, software platforms and M2M application developer support
will feature as increasingly larger components of the operators’ services.

“For example, AT&T announced on January
9, 2012 that it would be reselling Axeda’s M2M application platform in a US
carrier exclusive deal. This platform will enable AT&T customers to more
easily develop and deploy complex M2M applications,” said Sam Lucero, practice
director, M2M connectivity, ABI Research.

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