M2M device connections to grow dramatically

M2M device connections to grow dramatically

A new report predicts that global machine-to-machine (M2M) device connections will grow in the next decade from 100.4 million to 2.1 billion.

Revenue linked with M2M connectivity is also set to increase dramatically over the same period, from $5.7bn in 2011 to $50.9bn in 2021.

The report from Analysys Mason includes detailed 10-year forecasts of connections, revenue and average revenue per user (ARPU) for seven sectors and 20 M2M applications in eight geographical regions worldwide.

The report predicts that ARPU rates generated by M2M connectivity will decline markedly throughout the next decade, from a worldwide average of $4.71 per month per connection to just $1.98 in 2021.

'This per connection revenue decline will be caused by increasing price pressure and growth in the number of M2M device connections in emerging markets,' explained Steve Hilton, lead author of the report and principal analyst of Analysys Mason’s Enterprise and SME Strategies research programmes. 'ARPU rates for M2M applications are generally lower in emerging markets than in developed markets.'

According to the report, the share of worldwide connections attributed to developed markets will decline over the next decade, from 69% in 2011 to 59% in 2021. Similarly, developed markets’ share of worldwide revenue will have declined from its current level of 76% to 64% in 2021.

In 2011, slightly less than 20% of M2M connections were over fixed-line networks, and it is predicted that this figure will decrease to just 7% by 2021. According to the report, almost all fixed-line M2M solutions are in developed countries, because reliable, affordable fixed-line connectivity is difficult to purchase in emerging markets.

'However, mobile operators in developed markets are offering mobile connectivity at attractive prices, and most M2M solutions have fairly low bandwidth requirements. As a result, more and more enterprises are choosing mobile M2M rather than fixed-line M2M,' added Hilton.

Written by Mobile Today
Mobile Today


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