M2m Whitepaper

TeleconferenceThe Emerging M2M Market OpportunitiesMichele Pelino Principal Analyst Forrester Research

March 4, 2010. Call in at 10:55 a.m. Eastern time

Agenda Machine-to-machine (M2M) technology supports smart solution deployment. Growing corporate interest in M2M solutions Fragmented M2M vendor ecosystem Requirements for M2M to take the next leap

Entire contents 2010 Forrester Research, Inc. All rights reserved.

2



3

2009 was a tough year, but global IT purchases are expected to recover in 2010

Source: January 11, 2010, US And Global IT Market Outlook: Q4 2009 Forrester reportEntire contents 2010 Forrester Research, Inc. All rights reserved.

4

Economic recovery will launch the next IT investment period in Smart Computing6%

US IT investment-to-GDP ratio

5% 4% 3% 2% 1% 0

Innovation and growth

Refinement Innovation and and growth digestion

Refinement Innovation Refinement Innovation and and and and digestion growth digestion growth

Mainframe computing 1959-1970 1970-1976

Personal computing 1976-1985 1985-1992

Networked computing enterprise applications and the Internet 1992-2000 2000-2009

Smart Computing awareness and analytics in technology

2010-2016

Source: US Department of CommerceEntire contents 2010 Forrester Research, Inc. All rights reserved.

5

This tech spending boom will have three important dynamics Globalization LOB influence Tech Populism Influence sources

Smart Virtualization Mobile input/output Hyper collaboration Video Cheaper storage Web 2.0 Business intelligence M2MEntire contents 2010 Forrester Research, Inc. All rights reserved.

Cloud Pay as you go Pay as you grow Shared risk Outsourcing

6

Forresters definition of M2M technologies

M2M technologies collect and transfer information on the condition of physical assets or peopleSource: Forthcoming, The M2M Market Is A Blossoming Opportunity Forrester reportEntire contents 2010 Forrester Research, Inc. All rights reserved.

7

M2M technologies are core components of smart solutions

Source: Forthcoming, The M2M Market Is A Blossoming Opportunity Forrester reportEntire contents 2010 Forrester Research, Inc. All rights reserved.

8



9

M2M vendor announcements are plentiful, although few case examples exist More than 100 press announcements in the past six months focused on M2M or machine to machine. 30% announced M2M products 25% described partnerships and alliances 20% identified strategic activities

Half of the M2M press releases focused on a specific vertical industry. 33% in the energy/utilities industry 12% focus on the manufacturing industry 8% address healthcare initiatives

However, only 10% of these announcements highlighted M2M pilot or implementation activities.

Entire 10 contents 2010

Forrester Research, Inc. All rights reserved.

Market forces are driving enterprise interest in M2M solutions Declining device and communication service costs Reduced cellular costs Expanded customer reach

Regulatory and economic stimulus requirements Green IT initiatives Carbon emission reductions

Broad deployment of wireline and wireless IP networks National and international IP network deployment 3G network availability in mature markets



M2M technology solutions are often purpose built for specific industries Utilities/energy Smart grid solutions

Public safety Security monitoring and food supply tracking

Transportation/logistics Fleet management and monitoring

Retail Inventory control and asset tracking

Industrial solutions Supply chain automation and asset monitoring

Oil/gas Monitor flow, pressure, and temperature

Healthcare Asset monitoring and remote diagnosticsEntire 12 contents 2010 Forrester Research, Inc. All rights reserved.

Building monitoring Heating, air, and lighting and security




Four categories of vendors enable M2M solution implementation


Source: Forthcoming, The M2M Market Is A Blossoming Opportunity Forrester reportForrester Research, Inc. All rights reserved.

M2M vendors are making strategic changes to address market opportunities Mobile operators aggressively pursue M2M solutions. Establish dedicated M2M business units. Address billing and customer service requirements.

Many small vendors provide solution components. Its a complex vendor ecosystem. There are a lot of point solutions from individual vendors.

M2M application vendors go vertical. Purpose-built solutions for specific industries Vertical knowledge requirements

System integrators stake a claim in the M2M arena. Leverage ability to successfully integrate complex solutions.Entire 15 contents 2010 Forrester Research, Inc. All rights reserved.

Partnerships and acquisitions are prevalent among M2M vendors Partnerships are the dominant approach. Leverage individual competencies. Address the buyers preference for a one-stop shop.

Acquisitions are used by some vendors. Expand M2M capabilities under one corporate umbrella. This approach requires an resource and integration investment.

There are very few joint venture M2M relationships. nPhase was established through a Verizon Wireless and Qualcomm joint venture. Recent addition of Vodafone alliance broadens international reachEntire 16 contents 2010 Forrester Research, Inc. All rights reserved.




Supply and demand issues must be addressed to expand M2M solution adoption Fragmented vendor ecosystem confuses decision-makers Multiple coalitions and standards bodies for M2M solutions Lack of network and solution ubiquity Stakeholder concern over M2M solution complexity and customization requirements Few business cases to support solution deployment



Vertical focus and simplification will facilitate M2M vendor success The key to M2M market success: Go vertical. Consider new ways of thinking and working. Create a one-stop solution for the purchaser. Clearly define the ROI of M2M solution investments. Establish application developer communities. Address customer service and support concerns.

There are no clear winners and losers among M2M vendors yet.



Related Forrester research Forthcoming, The M2M Market Is A Blossoming Opportunity January 10, 2010, US And Global IT Market Outlook Q4 2009 December 4, 2009, Smart Computing Drives The New Era Of IT Growth October 19, 2009, Smart Grid Technologies: Coming To A Utility Near You



Questions?



Thank youMichele Pelino +1 617.613.6228 [email protected] www.forrester.com



Documents

M2m Whitepaper