Vodafone maintains its position as the number one global CSP for machine-to-machine, with AT&T, Deutsche Telekom and Telefonica making up the top tier. The last year has seen an evolution in operators’ approach to the M2M market from ‘global’ to ‘multi-local’ with implications for CSPs large and small.
Machina Research today published its annual review of the machine-to-machine (M2M) operations of the major global Communications Service Providers (CSPs). Based on detailed analysis of the capabilities of each of fifteen major CSPs, Machina Research has determined that Vodafone maintains its position as the number one global operator in terms of taking advantage of the global market opportunity.
Commenting on the results, author Matt Hatton said “Vodafone’s scale, growth and customer wins are testament to its ongoing lead in the sector. If we just look at the numbers, this year it overtook AT&T and Verizon to become the biggest global M2M provider, in terms of SIMs. It was also the fastest growing of the fifteen we studied. However we’re not just counting numbers of connections to determine current, or future, success. We expect initiatives such as its SOBE product, its plans for licensing the GDSP platform, and the added bonus of funds from Project Spring to provide further impetus in the next few years.”
AT&T, Deutsche Telekom and Telefonica complete a top tier of four CSPs. AT&T secured some fantastic deals and has shown real leadership with initiatives such as the Drive Platform, Drive Studio and Foundries. Amongst other things, Deutsche Telekom and Telefonica are singled out for the excellent work they’ve been involved with in developing their global alliances; the Global M2M Association and M2M World Alliance respectively. The theme of alliances is one that dominated much of this year’s discussions, with new members, including several key new members of the GMA, and the launch of the Bridge M2M Alliance.
Hatton comments: “We’ve seen a lot of movement this year around alliances, including new arrivals, new members and new capabilities. This is essential in what is evolving from a global market to a multi-local market, driven by regulation and customer demand. The challenge will be converting the excellent work that has been done in terms of technical cooperation, in areas such as certification and cross-network troubleshooting, into commercial cooperation.”
This theme of strategic collaboration and horizontal partnerships is having a knock-on effect in another direction. A number of CSPs are focusing on reinventing themselves from being broad-based global connectivity providers to being more regionally focused. Looking to the next twelve months Hatton predicts that this trend will intensify: “The need for alliances and horizontal partners will grow. CSPs without substantial footprints will struggle to deliver multi-local solutions on their own. Instead they must focus on using alliances to tap into global opportunities while going deeper into their domestic markets. However, these won’t be exclusive arrangements; alliance involvement will be a patchwork rather than a set of monolithic multi-carrier organisations”.
Hatton’s other prediction is that the ‘one-to-watch’ for next year will be SoftBank: “It acquired a majority stake in Sprint in July 2013 and looks set to take over T-Mobile USA. That would create a grouping of similar scale to AT&T and Vodafone, although with some integration challenges to address.”
The final trend identified by the Report is somewhat more nebulous. Hatton explains: “We have noted a trend of CSPs gearing up for the Internet of Things (IoT).” Three developments are pointing towards a more IoT-centric approach from CSPs: more support for application developers, a little more network agnosticism, and more global support. However, there is a long way still to go.
Hatton comments: “The role of the CSP today is firmly one of M2M, rather than IoT. For us the latter involves network agnosticism, mashing up of multiple data sources and the disaggregation of application development from the device itself. If CSPs want to move to becoming enablers of IoT as we define it then they will potentially need to undergo some radical change.”
