NETWORK STRATEGIES
in Germany, E21.7 in the UK and E31.6 in the Netherlands. Analysts forecast strong revenue
growth: Datamonitor estimates the global smart metering market for residential customers will reach US$5.7 billion by 2015, for example. But operators cannot simply replicate the economies of scale from consumer handset markets. One area operators need to tackle is
certification—ensuring devices pass conformance tests—explains Hilton. “Relying on the certification process from the handset world isn’t economi- cally viable,” he says. A handset can cost US$30,000–$50,000 to certify per model, which is justifiable for an ARPU of US$50–$100 per month he says. “But in the case of m2m, the ARPUs are much lower and frankly the volumes sold of a given m2m device are likely to be lower.” Operators also need to acquire new
skills for activating m2m devices. “Activation and provisioning is unlike anything else you use for handsets,” says Ingle at AT&T. “You need them to come awake for five seconds in a different country to where they were made and sold and then stay dormant until acti- vated by the customer.” There are other, more fundamental,
obstacles: the need to improve roaming agreements is a large element of the Orange-Deutsche Telekom partnership. Operators need a rapid resolution of any problems in roaming between networks if they are to provide the QoS guarantees that enterprises demand for time-critical m2m services, such as tracking medical pacemakers or transporting refrigerated goods. However, under current GSMA roaming agreements operators have up to 12 hours in which to resolve roaming service issues, according Lichtenthäler at Deutsche Telekom. Brenneis says Vodafone has tackled the
issue by developing a global SIM recog- nised as an m2m module across all of its own, and partner, networks. “We deliver the parameters” to SIM manufacturers, he says. This allows Vodafone to provide QoS guarantees on its networks and offer a single price and interface. “It’s neces- sary to have a global SIM as we don’t
March 2011
www.totaltele.com
Leading the way: operator subscriber numbers
REGIONAL BREAKOUT, END OF 2010 Europe: 29.5 million m2m subscribers, up 43% year-on-year. North America: 23.6 million m2m subscribers, up 51% year-on-year. Asia-Pacific: 19.6 million subscribers, up 53% year-on-year.
TOP TEN OPERATORS WORLDWIDE, END OF 2010 AT&T: 9.3 million m2m subscribers, up by 4.7 million connections (machines and consumer devices) during 2010. Verizon Wireless: 8.1 million m2m subscribers, up by 1.2 million connections during 2010. Vodafone: estimated 7–8 million connections. China Mobile: estimated 6 million connections. T-Mobile: estimated 5 million connections. Telefonica, Telenor, Orange, Sprint, America Movil: 2–4 million connections each.
Source: Berg Insight
Cellular m2m connections forecast 300
250 200 150 100 50 0
2009 2010 2011 2012 2013 2014 2015 Source: Berg Insight 0.07 billion
Commercial/consumer m2m device connections worldwide by sector, 2020 0.03 billion
0.28 billion 0.45 billion 1.32 billion
2020 n Utilities 62% n Security 21% n Automotive and transport 13% n Healthcare 3% n Government, retail, financial services 1% Total: 2.1 billion connections worldwide
Source: Analysys Mason
know [into] which country [the cars or machines] will go,” says Brenneis. Yet m2m services still are only likely to
make economic sense when sold as part of a bigger communications package. “From the operator’s point of view, selling the embedded connectivity is just the tip of the iceberg,” says Hilton. “It’s important that the operator also sells a managed or hosted platform and integration services.”
AT&T sees m2m as “part of a larger
suite of products”, says Ingle, which include its fixed network and data centre services. Such an approach keeps the cost of deploying m2m down, he says, because the operator can draw on both vertical sector and horizontal service expertise within its enterprise division to sell and support services: “We’re not selling one line of business. We’re selling a whole set
17
Million connections
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