M2M Wholesale – Where the Rubber Meets the Road

Those who recall last year’s YouTube video of the car thief thwarted by a GPS system may not realize it, but they witnessed a real-live example of M2M in action. Stopped at an intersection, the crook suddenly felt the engine die. The key froze in the ignition. Then the steering wheel locked. So did the doors and windows, trapping him in a plush leather cell with A/C and surround-sound. Moments later state troopers corralled the vehicle. A hidden videocam captured the would-be carjacker’s astonished face.

The case of “Reality TV meets Grand Theft Auto,” courtesy of a tiny in-vehicle device linked to law enforcement, is just one illustration of M2M at work. M2M’s growing role in day-to-day life and business is cropping up everywhere, which is good news for service providers’ wholesale businesses as well as for a new breed of M2M MVNOs.

The evidence is all around. Check out any major mobile operator’s web site and you’re apt to find several pages devoted to their wholesale M2M business. At least one major U.S. operator actively runs its own M2M laboratory, where developers and hardware manufacturers come to test their apps and devices. Lastly, MVNOs are making an impressive comeback, this time in the M2M space.

Who’s buying?
• Utility companies that use M2M to read electricity meters remotely and monitor key operational elements of their evolving smart grids
• Transport and logistics companies, for keeping track of goods and vehicles
• Retailers for mobile wallet transactions at point-of-sale terminals
• Security companies using CCTV (closed circuit TV) to monitor not only their own but also clients’ equipment and assets
• Health care providers remotely monitoring medical devices
• Consumer devices such as eReaders

And many, many others. Already noted: automobile manufacturers and GPS specialists that outfit cars with M2M capability for a variety of safety, routine maintenance apps and in-car entertainment, such as on-demand services or location-based services, all of which add up to increased demand both for carrier wholesale M2M and MVNO-supplied M2M services.

Of course, revenue growth doesn’t necessarily equal profit, especially in a high-volume, low margin business such as M2M. Adding to the challenge, carriers must have systems with the flexibility to support multiple devices. Another pressure: dealing with churn rates that can be even more severe than in the retail world whilst minimizing the cost to enable and disable connected devices.

Increasingly, today’s M2M winners address these issues by using highly scalable, flexible rating and billing engines expressly designed for M2M and with the ability to capture data from millions of devices across fixed line, 3G, and now 4G/LTE networks.

One standout success story: Sweden’s Maingate, an industry pioneer supplying M2M services to clients across Europe since 1999, using Convergys’ Rating and Billing Manager to process millions of usage records per month, a number that is steadily growing.

In M2M, fast, flexible, low cost and reliable systems are where, as the saying goes, “the rubber meets the road.” For wholesalers and MVNOs, choosing the right system can mean the difference between moving into the fast lane – or having the wheels lock up when transaction volumes demand maximum speed.


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