The Smart City sector is deploying M2M across a diverse range of public services and infrastructure including comprising Public Transport, Traffic Management, Environment and Public Safety and Public Space Advertising and represents a sizeable business opportunity. In a report published today, Machina Research forecasts that the market will grow from 59 million connections in 2011 to 512 million in 2020.
While Traffic Management generates the lion’s share of connections, reaching 446 million by 2020, it is the Environment and Public Safety group of applications, driven largely by CCTV deployment, which generates the most revenue. Machina Research predicts that this will be a EUR 7.5 billion opportunity globally by 2020. However, whilst Environment and Public Safety represent the largest market in terms of revenues, it is a relatively mature market and revenue growth is slow at 7%. Overall revenue from Traffic Management is smaller at EUR5.6 billion in 2020, but this application group experiences higher revenue growth over the forecast period with a CAGR of 22%.
Emerging Asia Pacific is the region which drives the most revenue, accounting for 59% in 2011 and remaining as high as 44% in 2020. This is largely due to China’s nationwide deployment of CCTV and its continued growth in this area over the forecast period. Europe will also constitute a large share of the revenue, comprising around 24% in 2020.
Michele Mackenzie, principal analyst, says, “Smart Cities & Public Transport is a diverse sector with a wide range of different public services, all of which can substantially benefit from M2M, in particular through driving efficiency savings. In most cases, each service has been conceived and developed often over a number of years as an independent silo, with little integration, interdependence or communication built in between services. The challenge with retrofitting existing cities will be to link up some of those independent silos where appropriate. Facilitating communication between traffic management systems and public transport vehicles is an obvious example but there is scope for wider ‘horizontal’ platforms, accommodating a number of ‘connected’ services. M2M is instrumental in enabling this communication.”
Commenting on who is best placed to take advantage of the burgeoning Smart City opportunity, Mackenzie adds: “Smart City projects are by nature large and complex and there are no ‘one size fits all’ solutions. They require the expertise of a number of industry players hence there are substantial opportunities for vendors, systems integrators and fixed and mobile network operators in this market and more importantly partnerships between players.”
Machine-to-Machine (M2M) Communication in Smart Cities & Public Transport 2011-20 provides qualitative and quantitative analysis of the emerging opportunity for M2M communications in five key areas: Public Transport (road, rail, air and sea transport as well as ticketing and passenger information systems), Traffic Management (parking space management and payment, congestion charging and road tolls, traffic volume monitoring, connected road signs, traffic lights and enforcement cameras and in-vehicle congestion and toll devices), Environment and Public Safety (CCTV, street lighting, waste collection, public alarms and intercoms and tourist information services) and Public Space Advertising (static advertising and billboards). The report reviews the major drivers and barriers for growth of M2M in the sector and analyses the key market dynamics, including how MNOs, fixed operators, service providers and vendors might go about identifying and realising addressable opportunities.
The forecast excel data sheet includes granular 10 year market forecasts for 54 countries and six regions. The forecast covers numbers of connections, traffic and revenue for each of the identified application groups with splits by technology (short range, 2G, 3G, 4G, MAN, fixed line and satellite) and a break-out of mobile traffic revenue.