M2M: Barriers to growth

Markus Steingrover/Detecon International

 Detecon InternationalThe "Internet of Things" - connected, communicating machines - is a huge growth market. Analysts predict that machines with micro-SIMs will outnumber SIM cards used by humans by a factor of ten within five years. As a consequence, the M2M market will be a multi-billion-dollar market with a short-term CAGR of about 40%.

M2M use cases can be designed for all kinds of industries. Flexible, wireless M2M solutions also enable new businesses. Examples range from improved demand planning and electrical power outage prevention by smart grids to real-time consignment tracking for location or temperature status. The healthcare sector also can benefit from the possibility of remote monitoring of vital body functions. 

Although there are ample opportunities for M2M deployment, sectors like healthcare with high margins are lagging behind. How can the full growth potential of M2M be unleashed? The chart below shows the results of interviews at the Telco 2.0 Executive Brainstorm event, in which industry experts evaluated potential M2M market growth barriers.
Addressing roadblocks

The top three obstacles are regulatory issues that translate into four roadblocks that national regulatory authorities (NRAs) need to address: numbering distribution, switching costs. technical interfaces and roaming.

Addressing these roadblocks might require regulatory intervention or adjustment of existing regulatory practice. As national circumstances differ, there are no standard solutions.

Numbering distribution. M2M devices use GSM/GPRS platforms with SIM cards and assigned numbers according to the national numbering plan. Strong growth in M2M device numbers requires sufficient mobile numbers that can be assigned. Numbers are, however, scarce. Depending on the numbering plan they might be limited. 



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