GSMA specification for M2M and Internet of Things will 'accelerate' market says Beecham Research

The recently launched GSMA eUICC Embedded SIM Specification will "accelerate and help transform" the M2M and Internet of Things (IoT) markets, according to a report from analyst Beecham Research.

The report was launched in association with the GSMA to coincide with an announcement that leading mobile operators, along with SIM and module manufacturers, have all launched solutions compliant with the new specification.

The use of traditional handset SIM cards presents challenges for insertion and replacement in M2M products for transport, consumer electronics, utilities and other applications, which can add cost and create barriers to sales.

To overcome this, a specific non-removable SIM embedded at the point of manufacture enables remote provisioning of a user subscription profile from the operator providing the connectivity. This eliminates the need to replace SIM cards over the lifetime of each M2M product, reducing ongoing operational and logistical costs and helping to streamline the retail process.

The Beecham Research report, prepared for the GSMA as an independent view of the benefits for business of the GSMA Embedded SIM Specification, examines particular opportunities in the auto, consumer electronics, and smart metering sectors, among others.

As part of the research, senior representatives from these industries were interviewed together with mobile network operators, SIM vendors and M2M hardware vendors. The consensus reached during the research is that devices installed by manufacturers must adhere to a single specification that is standardised globally through mobile operators in order to open up full market opportunities.

“The availability of the GSMA Embedded SIM Specification is a big deal for the connected devices market,” said Robin Duke-Woolley, CEO of Beecham Research. “This is targeted primarily at the OEM community to make it easier and more streamlined both to build cellular connectivity into their products and to sell them through many more channels to market."

He added: "The solution also considerably opens up the second hand market in cars and other products for continued use of support services by second and subsequent owners.”

The estimated uplift in the installed base of connected devices by 2020 as a result of using the GSMA Embedded SIM Specification as opposed to proprietary embedded SIM solutions is calculated at 34 percent, according to the report.

But this is a "conservative estimate", said Beecham analyst Saverio Romeo.

“In practice, this is great for the auto industry and is likely to lead to faster growth, not only for new sales but for the second hand market as well. We also think it will drive a lot of new sales internationally in the consumer electronics market and lead to more elegant product designs,” said Romeo.

Copyright © 2014 IDG Communications, Inc.

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