Mobile telcos must prepare for M2M: Ericsson

A saturated mobile market and continued downward pricing pressure on devices and plans mean Australia’s mobile network operators must turn to machine to machine (M2M) communications to ensure their future profitability, Ericcson Australia has warned.

Detailing the future growth of M2M communication in an industry discussion paper, the networking infrastructure provide claimed the growth opportunity in communication between mobile and fixed devices was “vast and unprecedented”.

“As with other connectivity-based evolutions, telco operators are uniquely positioned to create and drive the M2M wave, given their vantage position to stimulate ecosystem developments and influence consumer behaviours,” the paper reads.

However, to capitalise on the emerging trend, typified by Australia’s growth in smart meters, telcos needed to shift their business away from being suppliers of voice and data services toward becoming an integral part of the supply chain in industries such as utilities, government, transportation, health, education and finance.

Unsurprisingly, Ericsson is pushing for mobile operators to ensure their networks were able to support exponential device growth and capable of being partitioned to support the needs of specific market verticals.

“Realtime capabilities and quality-of-service guarantees will be critical,” the paper reads. “They must also ensure their M2M platforms are open and standards-based to provide interoperability across ecosystem players and vertical industries…”

Ericsson has been actively promoting M2M communications for a number of months, detailing in July that there had been a tenfold growth in the number of connected devices — to five billion worldwide — in the 10 years to 2010.

The company expected a further tenfold increase in connected devices — to 50 billion worldwide — in the 10 years to 2020.

Whereas the increase in the decade to 2010 was driven by personal mobile devices, such as smartphones, the decade to 2020 would be driven by devices used in traffic systems, remote healthcare and medical automation, connected buildings, smart grids and meters, and critical infrastructure.

Ericsson is not the only company to cotton on to the potential of M2M. In September, Telstra announced it had launched a new control centre allowing customers to more easily design, deploy and manage mobile M2M connections.

As reported by Computerworld Australia Unwired’s former chief executive officer, David Spence, in September 2009 tipped M2M as a major source of telecommunications growth.

“The tremendous growth in the future is all going to come out of machine-to-machine connections,” he said at the time. “The wireless world will enable a whole plethora of different applications which connect machines which become very useful.

“Ten years ago we used to fight over seven million households in Australia for Internet connections, and now we fight over 21 million people to get Internet into a device they use on a personal basis. I think in five years time we will be fighting over 100 million machine-to-machine connections.”

In October last year, Victorian electricity distributor, SP AusNet flagged that it intended to partner with 12 companies to utilise WiMAX technology to rollout 680,000 smart meters in the state over the next three years.

Copyright © 2010 IDG Communications, Inc.

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