If Huawei launches European M2M business it will be a challenge for Cinterion, Sierra, Telit, says Machina

Matt Hatton Matt Hatton

Shenzhen, China and London, UK — Although Huawei has yet to formally announce it, reports from Shenzhen suggest that the giant China-based telecommunications equipment provider is about to launch itself into Europe’s M2M market.

Matt Hatton, an experienced telecoms analyst and a director of Machina Research says, “While Huawei modules have been finding their way into M2M (machine-to-machine) devices for ages, this demonstrates a new intent from the manufacturer. Of course, what everyone fears is that Huawei (and its compatriot ZTE) will completely dominate the M2M market in the same way that they did with the USB modem market, obliterating competition from the traditional vendors such as Option.”

Hatton continues, “That is certainly the threat. However, neither of the Chinese players is in the same position to apply the same degree of scale to M2M as it has to mobile broadband. The M2M market is so fragmented and requirements so diverse that, to an extent, the benefits of scale will be somewhat hard to realise.

“The traditional vendors (including Cinterion, Sierra Wireless and Telit) have a role to play, but it is an inescapable fact that they will be challenged massively by Huawei on price. And let’s not forget this is a market where ASPs are dropping already. How do they compete with Huawei? The simple answer is flexibility and customisation. The more complicated answer will wait for the upcoming reports that we at Machina Research are planning on the module market for October,” Hatton adds.

Click Here to read more from Matt Hatton’s blog, The Wireless Noodle.

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