Consumer M2M Services Could Boost Operator Revenues

As machine-to-machine (M2M) applications widen in an increasingly connected society, communications companies are looking to diversify their M2M offerings beyond what can easily become a commoditized connectivity.

Consumer M2M applications – centered on such small/portable consumer-electronics devices as e-readers and digital connected photo-frames – are the closest to telcos’ core capabilities of providing digital lifestyle services.

"2012 is expected to be a year when telcos will begin developing consumer M2M opportunities in addition to their current enterprise focus,” says Frost & Sullivan Senior Industry Analyst Yiru Zhong. “Companies with a strong consumer brand and a deep consumer digital offering could most readily capture this approach.”

Though telcos in Europe are currently pursuing the immediate enterprise M2M opportunities in industries including utilities, automotive, security/surveillance and healthcare, they do see market potential in consumer electronics due to wide adoption of smart connected devices.

"In addition, this trend has a long growth path as more smart or connected devices become available in the future," notes Zhong. "There is also increased uptake of consumer-grade industrial devices such as personal home wellbeing/healthcare devices and personal navigation devices."

Thanks to extended connectivity to these types of services, there will be an accumulation of M2M data about consumer usage. Integrating this data into a telco’s overall customer analytics will contribute to service deployments and customer improvements.

In addition, telco attempts at making sense of M2M data will provide a solid foundation for future deployments in a smart-cities context by shaping citizen’s digital lifestyle.

However, telcos will have to address two issues to speed up market development, notes Frost & Sullivan. “Firstly, they will need to upgrade their data analytics capabilities and data warehousing integrations. This is already being addressed though, particularly as M2M will also create significant volumes of usable data from a variety of different resources. The second obstacle is a suspicion of big-brother society. Telcos can address this concern by always ensuring customer’s choice and consent.”

"To summarize, we believe that 2012 is a year when telcos will actively investigate consumer M2M applications and consider ways of utilizing the resultant M2M data to create a richer consumer offering befitting a digital society," Zhong concludes.

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