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TALKING HEADS

“We need to quickly find more effective ways to make (M2M) look and feel easier to handle.” Dominikus Hierl, Telit

hardware, acquiring software and services assets to augment their offerings, making them easier to integrate and to enable connected solutions. At Telit, of course, we have been on this path for quite a while now. We have concluded several acquisitions, all with the objective of delivering this enhanced experience to large industrial adopters. And if we are meeting their requirements and targets, we are most certainly meeting those of other scale customers. The need to change the way we package and deliver M2M in the form of products and services from dozens of different vendors into manageable solutions from the perspective of the adopter is clear and present. It comes not only from the groundswell created by the bold statements from these large industrial players, but also from the shift in expectations from the technology industry. The ‘App’ effect has hit the industry, and potential adopters need M2M and the Industrial Internet to look and feel more like installing an app on your smartphone, if for no other reason, than because that is what their customers expect. When the smartphone revolution started a few years ago, none of us in the M2M industry could have imagined that something so distant in consumer electronics could possibly impact the dynamics of the largely B2B-based value chain that makes up our space. But it impacted it profoundly. Connected products like building controls, security alarm panels, car infotainment and navigation systems now have to be as easy to use as a smartphone app and to pack ever-increasing functionality. The pressure this places on integrators and developers is passed down to us in the M2M value chain. M2M Now: As you say, most of these initiatives follow the ‘One-Stop-Shop’ idea. Why is this? DH: Again, it is the ‘App-ification’ of the Industrial Internet. All across the tech industry, companies and adopters want to see that kind of user experience. In order to deliver that in M2M, we need to package key pieces involved in connecting machines, as much as possible, into solutions. But even that is not enough – we also need to wrap all that with layers of valueadded services required to quickly enable complex yet easy-to-use customer applications. Furthermore, all that needs to be available from the same vendor and fully integrated into the solutions in order to approximate this ‘App’ look and feel. So, when you look at what that is – you see it is the One Stop Shop. It is an entirely new delivery model for our industry, but it is clear there will be no mass adoption without it.

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M2M Now July 2013

Year after year, even though forecasts for M2M keep going up in absolute numbers, if you look closer, you will see that analysts are taking ever smaller percentages of total available market of connectable machines which they believe will actually make it to M2M. This revision has to happen to adjust for the widening gap that has formed between our industry’s componentcentric delivery models and the mass adoption market we are exploring here. Fewer and fewer adopters are willing or able to take products and services this way. The answer is now right there for us to read and implement, and the One Stop Shop race is on. M2M Now: The cellular module that works outof-the-box is a valuable offering in the One Stop Shop. What is the role of traditional operators’ business models here? DH: There are a few ways this can happen. All major operators have by now established internal M2M organisations – some have been running for a while, some are just getting started. They all offer rate plans specifically designed for M2M, some have strategic partnerships and some have taken equity stakes in companies covering value-added areas like service enablement platforms and so on. There are services like our m2mAIR, however, that deliver high value benefits from service platforms reaching well inside the module and which make connected machines deliver better results. But these are too far outside the consumer models that operators typically have to use as the base for their M2M offerings. So far, not delivering this facility has not surfaced as a major stumbling block, but it is likely to become one now that major adopter expectations are becoming clearer. With the flurry of activity in this area, operators will need to figure out how they will handle this and other similar cases. One thing is certain though, the relationship between operators and M2M providers will continue changing and evolving. M2M Now: How do large cellular operators arrive at an integrated One Stop Shop offering? DH: It is hard to envision large cellular operators ever becoming One Stop Shops for M2M. There will always be demands from One Stop Shop customers that are fundamentally incompatible with the business models and operational constraints supporting consumer smartphones. And when you look at the dreaded ARPU (average revenue per user), still largely steering cellular operator decision-making, you start to see how decisions are going to go when ARPU for connected machines is a mere fraction of the consumer number, and forecast by industry analysts to remain that way for the foreseeable future.

Profile for Prestige Media

M2M Now Magazine July 2013 Edition  

The latest product, people & market news from the Machine to Machine sector. Includes expert industry opinions and interviews.

M2M Now Magazine July 2013 Edition  

The latest product, people & market news from the Machine to Machine sector. Includes expert industry opinions and interviews.

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