News
16/09/2009
27.3 billion EUR for cellular M2M and 2.1 billion EUR for satellite M2M in 2013
M2M
Montpellier, France – September, 16 2009 – “The M2M market is still growing despite the global downturn” says Samuel Ropert, Project Leader of the report. In 2009, the cellular market should represent 38 million modules worldwide for a total market of 11.2 billion EUR. But growth in 2009 will be much lower than expected, less than 10% in value and 25% in volume, as most of the vertical markets are suffering from the economic crisis (automotive, industrial machines). The situation should be the same for satellite M2M, representing 1.03 billion EUR in total market value for 2009, although the target markets are not the same.
All the players hope that emerging markets will take the M2M market to the next level with forecasts of 27.3 billion EUR for cellular M2M and 2.1 billion EUR for satellite M2M in 2013. Expected volumes are huge because they are related to very commonplace machines (cars, meters, consumer products…) and could account for 6.5% of SIM cards in Europe by 2013. Most of these new solutions have less well defined business model and therefore remain more dependent on the application of vertical regulations which would be hard to implement without the deployment of M2M. This also explains why Europe is leading the M2M market (more vertical regulations in Europe), while USA is the leader for satellite-based solutions (especially on homeland security).
While some telcos were reluctant to position themselves directly on these markets a few years ago, most of them are now battling actively to carve out a significant share of the market and are trying to distinguish themselves through technical initiatives (IPv6, hardened or embedded SIMs, portals…) and other business features (international one-stop shopping, leasing…). M2M offers them attractive opportunities, as, despite low ARPU, projects offer high lifetime value, reduced churn rate and average deals representing thousands of SIM cards. Connectivity alone should represent 4.3 billion EUR in 2013 and more than 4% of mobile data revenues for European telcos. MVNOs are being pushed out of the market and are therefore repositioning themselves as tool providers, while module providers are having difficulties to break even in a market in which unit prices are falling.
