By Andy McFarlane, head of marketing, Vodafone Global Enterprise
In looking at the emergence of mobility as potentially game-changing for major corporates worldwide, it is interesting to draw parallels with the rapid growth of the internet over a decade ago.
Initially, companies tested the water with small, department-based pilot projects in order to determine the potential impact of the web. Armed with these early experiences of how the internet could successfully improve internal processes and serve customers better, a more robust and fundamental transformation typically took place. Today e-business has reached a level of mainstream maturity in which it forms an intrinsic part of almost every business.
Similarly, with the development of the mobile phone from simple communications device to handheld computer and the growth of machine to machine (M2M) solutions, businesses are once again going through a controlled ‘test and learn’ phase as they try to understand what a broader roll out would look like in mobilising their in-house and customer-facing processes.
The latest indications are that this trend is accelerating as the economic climate starts to look more positive. For example, a brief look of the large number of partnerships and other initiatives announced at Mobile World Congress 2011 in Barcelona highlights this. In a growing number of industry sectors, manufacturers, system integrators and other channel partners are clearly identifying the potential which M2M offers to expand into new markets.
In providing the right springboard for innovation, businesses have also recognised that mobility can help them get their existing cost base into better shape. As part of this, the Software-as a-Services (SaaS) operating model is moving centre stage, as investment becomes increasingly OPEX rather than CAPEX-led and rental-based models become more attractive.
Real growth potential
M2M technology is firmly established across a number of different sectors, such as utilities, security, fleet management and automotive in wirelessly connecting products to the Internet. Its importance looks set to grow as individual industries recognise the myriad benefits M2M can deliver, both to providers and end users alike. Unlike other earlier technologies that ultimately fell short of expectations, the evidence of two industries in particular shows that M2M’s potential looks to have greater substance than most in matching advanced technology to real-life need.
In the automotive sector, forthcoming EU regulation will stipulate that all cars incorporate a connection which will send an emergency ‘e-Call’ message to a service centre in the event of a vehicle crash. It is anticipated that from 2014 it will be mandatory for manufacturers of new models sold in the EU to fit an e-Call box as standard.
In the event of an accident, as soon as an airbag is deployed impact sensor information and GPS co-ordinates will be sent automatically to the nearest emergency service agencies. This will include the precise location and nature of the incident, making sure that help is on hand as fast as possible. The EU predicts this will save approximately 2,500 lives each year by cutting response times such as when incidents occur at night or in remote areas where urgent medical advice is critical.
For automotive manufacturers, M2M solutions incorporating sophisticated in-car communications systems are driving the ‘smarter car’ towards the mass market. This could include personalised entertainment applications and automatic navigation aids which show in real time points of interest such as hotels with rooms available as well as the ability to research and make restaurant reservations en-route.
M2M will also have significant impact in the area of smart metering in the utilities market. Driven by regulation, EU legislation has mandated that every home within member states will have a smart electricity meter by 2020.
Devices incorporating M2M chips have already been deployed in 1.8 million homes in the UK. This trial is designed to implement a nationwide programme to analyse energy usage, in order to drive electricity supply efficiencies and deliver better customer service as well as remove challenges over estimated readings and revised bills removed at a stroke.
Once proven, this will be followed by parallel initiatives involving other utilities such as gas and water, within the broader move towards the ‘smarter home’.
In both automotive and smart metering applications, the key to success will be the adoption of a global SIM. This is necessary in order to ensure seamless, cost effective coverage across all networks, as a common solution providing robust connectivity across multiple geographies.
Benefits for all
Analyst, Berg Insight, has predicted that M2M will double its share of mobile communications by 2015. Such high expectations should not come as a surprise, however. Common to developments such as smart metering, in-car technologies and other initiatives set to revolutionise our lives is that everyone is set to benefit. Manufacturers and service providers win, as M2M-based devices help them become more cost-efficient and create competitive edge through improved innovation in completely new markets.
End users win, as M2M helps them become more energy efficient (so saving money), and improves their quality of life. The regulators and governments win, as M2M is key to making better use of limited natural resources.
There is another common thread here. These are not typically the result of evolutionary thinking, but represent more fundamental change in developing new technologies and processes for new markets. To stay ahead of the game here requires a powerful combination of strong internal change agents and innovative, forward thinking third-party communications providers.