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IDC warns Asian telcos must define M2M strategy or miss out on multi-billion dollar market
TT Correspondent |  |  29 Aug 2013

According to the research firm IDC, Asian telecom service providers must start to define how they will deliver and support the machine-to-machine (M2M) solutions that drive the Internet of Things or miss out on their share of a multi-billion dollar market opportunity.

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IDC expects Asia Pacific excluding Japan’s (APeJ) connected M2M market ecosystem to grow 127% from USD 3.0 billion in 2012 to USD 6.8 billion in 2017. This ecosystem includes modules, service connectivity, platforms, applications, analytics, security and professional services.

In addition, the number of M2M connections that will connect to the telcos' networks will grow 171% from 26.8 million to 72.5 million over the same period of time, creating an unprecedented market opportunity for those telcos that can adapt to meet the challenge.

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As the buzz around the market opportunity for the Internet of Things gathers pace, telecom services providers in Asia need to enhance their existing internal capabilities and develop partnerships across the M2M ecosystem to make sure they do not get left behind.

“The vast majority of telcos face a future with the declining or slowing of their traditional voice and data revenues. As such, they need to identify new revenue streams and business models to drive future revenue growth,” states Charles Reed Anderson, Head of Telecoms, IDC Asia Pacific. 

“However, few Asian telcos have the required skill sets currently to offer anything other than the network on which M2M solutions run. The key will be seeing which telcos can build out their internal skills and form the right partnerships with the platform and application vendors to jointly-develop the solutions that drive the market.”

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He points out that while this market will grow across the region, certain countries and industries will lead the way.

“China, for instance, will account for 48% of total connections and 49% of total M2M spend by 2017, creating a USD 3.3 billion opportunity in that country alone. The 'smart-city' initiatives combined with the massive growth in M2M in the resource industries and utilities will push China to the forefront of M2M solutions, as well as be the key driver of the Internet of Things,” says Anderson.

He notes that the massive market opportunities combined with the buzz around M2M and the Internet of Things has not only generated excitement in the ICT community, but also provided the impetus for the telcos to act fast to define their M2M solution strategy.

“In recent years, many telcos have been slow to react to new market opportunities and have lost out as a result. As they continue to see the slowing of their traditional revenue streams, they realize that M2M is one opportunity they cannot afford to ignore.”

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29 Aug 2013(IST)  
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