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Author's profile photo Jens Amail

The Massive M2M Business Opportunity (Part 2)

/wp-content/uploads/2013/02/telco_187319.jpgRead Part 1 of this series here: The Massive M2M Business Opportunity (Part 1)

Telcos are sitting on a gold mine of core capabilities and assets, critical for M2M success. In addition to just network connectivity, they have outstanding expertise in large scale service delivery with high reliability and global reach, plus an arsenal of partners for content, apps, specialized solutions and services, integration, as well as terminal and module vendors.

Where do I see the most opportunities in the M2M space for communication service providers (CSP)? I see opportunities everywhere because most industries will be adapting some form of M2M scenario, with certain industries being farther ahead than others. I think CSPs should look at those industries where they have the strongest footprint and where they can build upon their current strengths.

Take the example of the automotive industry and connected cars. Equipped with internet access that can share data between devices inside and outside the vehicle, these cars have special technology that brings additional benefits to the driver. A car like that is like a personal assistant. It can connect you to your email, display your latest social network updates and enable your phone calls. It can direct you to the nearest empty parking spot and even help you find it in case you can’t remember where you parked. In some smart cities, these cars are also connected to public transportation grids making inner city traffic more manageable. Add new regulations such as eCall in Europe for automatic emergency calling and the Contran resolution in Brazil requiring all vehicles to be fitted with an anti-theft tracking device to help reduce car thefts and lower car insurance rates, and you can see how all these scenarios offer ample opportunities within the industry.

It will be key for CSPs looking at M2M business opportunities to have a clear strategy about how they’ll go to market. Successful business in this new, exciting  M2M world will require strong partnerships amongst various providers for a full service offering to the enterprises – meaning that CSPs need to partner with a network management provider for device connectivity management as well as an M2M software platform provider that integrates seamlessly to the enterprise backbone.  Telcos should look for partners in the software industry with a successful track record in those verticals they want to go after with M2M services. The market has tremendous potential and many of the CSPs that I’ve spoken with expect over 5% of their revenue to come from M2M services in the short-term. Selecting the right partners will be a critical success factor for sustainable and profitable growth beyond Telco.

SAP can help CSPs by delivering a complete software platform for rolling out M2M services along with a suite of analytics, cloud, real-time processing, and mobility solutions. SAP also provides a scalable event agnostic charging and billing solution for B2B and advanced partnership management, plus industry specific solutions and expertise within twenty-five different verticals.

In short, I see tremendous growth potential for operators to develop beyond their telco roots.

As providers of mobile networks and services, telcos can become main drivers in the M2M space by forging strong partnerships with network management and software platform providers – leveraging the power of three for success! Follow us on

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The Massive M2M Business Opportunity (Part 1)

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      Author's profile photo Derek Klobucher
      Derek Klobucher

      Thanks for this look into the brave new world of M2M, Jens! Do you foresee any telcos foregoing partnerships in order to develop their own software?

      Author's profile photo Jens Amail
      Jens Amail
      Blog Post Author

      I believe that we will see it all; both partnerships, acquisitions, and consolidations as MNOs look to move up the M2M value chain and thus deciding where/how to invest. We will see partnerships/acquisitions to develop own software where it makes sense, and provides a differentiator [For ex the acquisition by Verizon of Hughes Telematics]. But we will also see MNOs revisiting their initial M2M software investments and looking for partnerships and scale [for ex Ericsson acquiring the M2M technology platform from Telenor Connexion]. We are also seeing MNOs partnering with software companies in order to provide end-to-end services to enterprises within different industry verticals; one ex being the Deutsche Telekom and SAP cooperation for the port of Hamburg. And we might see additional cooperation between MNOs, today mainly focused on ensuring M2M global coverage and SIM / roaming.