Mobile M2M Market Flourishing

The machine-to-machine (M2M) wireless communications technology has become a major driving force for the next-generation mobile messaging system. M2M is a rapidly growing market opportunity. According to various industry sources, globally M2M connections may reach more than 200 million by 2014 with a total market valuation of approximately $57 billion. This new business model is emerging as a potential source of massive revenue to several telecom operators and equipment manufacturers.

A typical mobile M2M messaging system establishes a wireless communications link to connect a group of devices to a computer server or another device for the purpose of transmitting data contained within those devices. This emerging M2M market provides the opportunity to mobile-enabled millions of devices, like cars, utility meters, vending machines and consumer electronics devices to get connected to a wireless network.

In 2007, AT&T (T - Analyst Report) had entered into an agreement with Jasper Wireless to use the latter’s connected device platform together with its own Enterprise On Demand  connected device platform in order to provide mobile M2M connections.

Last July, Verizon Wireless (VZ - Analyst Report) and Qualcomm Inc (QCOM - Analyst Report) have formed a joint venture to provide M2M wireless communications and smart services offerings across several market segments. This joint venture will be equally owned by these two companies and will act as a single source for M2M solutions for healthcare, manufacturing, utilities, distribution and consumer products segments.

In last September, T-Mobile, the mobile communications division of Deutsche Telekom AG (DT - Analyst Report) and Sierra Wireless (SWIR - Snapshot Report) have signed a Memorandum of Understanding to form a joint venture to provide M2M wireless communications. This M2M solution will offer innovative solutions for the fleet, automotive, navigation, utility, and security markets.

Recently, Sprint Nextel (S - Analyst Report) has formed a partnership with DataSmart for M2M solutions. Wireless IP specialist InterDigital Inc. (IDCC - Snapshot Report) is also entering the M2M sector with a deal to license its 2G/3G patents to Cinterion Wireless Modules GmbH, a specialist supplier of M2M modules.

Mobile M2M connections, which enable wireless data calls between machines, are the new services and business models that have recently received significant market traction. Deploying innovative connectivity platforms to deliver seamless, fully integrated M2M communication with global connectivity is an important factor to mobile service providers’ success in this market.