M2M: Value Beyond Connectivity

Healthcare isn’t the only industry with specific needs. “For instance, a smart metering implementation for a utility company may have hundreds of thousands or even millions of endpoints, and all must be managed cohesively,” says Hansmann.

So how can an MNO truly understand the needs of its niche industries, thus providing a more competitive offering? The answer is partnership.

Just last month, Telefónica, the leader in M2M connections in Europe, announced that its German subsidiary agreed to a partnership with Sparkassen DirektVersicherung (in English, “Sparkassen DirectInsurance”) to bring the first insurance-telematics service to Germany. Telefónica also partnered with Spanish insurer Generali Seguros in February to launch a similar service in Spain called Pago como conduzco.

“Through partnerships like this we can work together with the insurance industry to help them leverage the significant benefits this technology can bring to their businesses,” said Carlos Morales, director of M2M at Telefónica Digital.

Service providers are also looking to smaller, more agile vendors to help boost their M2M business value. Cycle30 President Jim Dunlap says he's been surprised at how quickly their M2M business has grown. He says, scalable, flexible platforms that don't cost an arm and a leg are helping service providers make their M2M business viable profit centers, which often rely on a large volume of transactions with small profit margins for each transaction. He points to the success of DeviceCloud Networks, one of their customers that owns Viking Wireless, that has "eliminated the excessive roaming fee problem with dynamic SIM and tapped into the global revenue share opportunity," Dunlap says. Cycle 30 has also recently signed on to work with Arrow Electronics. 

The numbers don’t lie. There’s huge money to be made from the industrial internet, the Internet of Things, M2M connectivity—whatever you want to call it. The key for mobile network operators will be to make their case for ease of management while boosting device life spans and meeting the nuanced needs of the verticals they’re courting.

Connectivity alone isn’t going to be enough—where’s the value?