The future is machines in your home that talk! Be it a fridge reporting you need more milk and then ordering it direct from the supermarket to enable a delivery to you the next morning!

Your burglar alarm sending you a text to ensure it is not a false alarm. A box at the side of the road monitoring traffic flow.

A solution tracking a vehicle or asset such as a roadside digger.

Your water or gas meter delivering a reading daily to the utility company... The applications are endless.

With over 65 billion machines globally, M2M connectivity is the simple cost-effective way to talk two-way with remote devices or sensors and let them communicate key information to wherever whenever you want, stationery or mobile.

Working as an overlay on cellular networks, both GPRS and 3G. SIM-based private connectivity with Fixed IP is now enabling the benefits of wireless technology to make commerce more efficient, and machines communicate for themselves be it stock control, wireless payment, engineering work, fault reporting or tracking.

M2M Applications come in three flavours   

The After-market category of applications usually involves retrofitting connectivity to products already installed and working in the field, for example connecting vending machines and monitoring environmental conditions. They tend to automate operations already running and are typically introduced to gain operational cost savings. These applications occur in all business sectors and require high levels of technical support to implement. As a result, they tend to be relatively low to medium volumes and medium to high cost per unit. Break-even point and ROI are important considerations for these and, as M2M solution costs have declined over time, so more of this type of application has met breakeven and ROI criteria.    

Regulatory applications are created by the introduction of new regulations, usually associated with particular applications. Road pricing for HGV vehicles in Germany and congestion charging in London are typical applications, as are AMR metering applications in a growing number of countries. These tend to be national or city based, have lengthy gestation periods and design cycles and are often subject to tendering processes. Connectivity is usually (but not necessarily) designed-in during manufacture, so that unit costs are kept low with high initial volumes until the base has been covered. These applications are very specific and only apply to particular market sectors. 

Line Fit/OEM-based applications, on the other hand, are most often driven by product manufacturers, acting with partners or on their own, to create new services opportunities related to their products. Connectivity is designed-in to minimize unit costs for high volumes. These applications can apply to almost any product in any sector, so the opportunities are particular broad. The classic example of this is OnStar Telematics in the US, created by General Motors for their top of range models. Handheld tracking devices are also examples of this category.

Each of these categories has different market dynamics and different prospects for growth. Whereas the After-market category is a relatively mature market, Regulatory and OEM are considerably younger. The OEM category in particular is still at an early stage, with extraordinary prospects for growth over the next few years. It is this category, more than the others that will drive the new service opportunities for connected products in future.