M2M has passed the hype stage and entered a more realistic phase of development where innovative suppliers are solving tactical problems associated with defining, delivering, managing, and monetizing real products for real customers. That takes time, but the value is there, and the market is now evolving at a much more realistic pace.
Another year, another prediction about machine-to-machine (M2M) communications, the Internet of Things, connected devices, or whatever term we choose to describe our relentless pursuit of connecting everything to the Internet. The past few years have been spent trying to figure out how to connect devices, appliances, automobiles, meters, and basically anything with an integrated circuit, to the public network. And, in some respects, we’ve succeeded. Cisco reports in its annual Visual Networking Index (VNI) that in 2011 there were billion connected devices, and that number is expected to reach billion by 2016. The NPD Group reports that there are million connected devices in the U.S. Using those figures, that translates to more than devices for every human on the planet. That’s a lot of connections!
In my house, there are no less than nine devices that are continuously connected—and there are only two of us! But wait, there’s more. There are the GPS devices in our cars, the electric meter, the security system, and our washer and dryer communicate that with each other. I don’t know exactly what they say, but I find it a little unsettling. Yet, for all this connectivity and all this electronic intelligence at our fingertips, my impression is that it is all grossly underutilized. What that tells me is that enabling devices to connect and communicate is easy—making good use of that connectivity is not. Further, the ability of Communication Service Providers (CSPs) to monetize the expensive wireless, fiber, and cable infrastructure underlying all those connections is still a real problem.
While analysts are generally hesitant to revisit previous predictions, looking back at previous Cisco VNI figures is revealing. As recently as 2010, that report predicted one trillion connected devices by 2013. Based on the most recent publication, that forecast was off by nearly a factor of . So was Cisco being overly optimistic or did M2M run into reality? Both. Just because we can connect doesn’t mean that there is value in it; and what value there is has to be apparent to both the users and the providers. M2M has passed the hype stage and entered a more realistic phase of development where innovative suppliers are solving tactical problems associated with defining, delivering, managing, and monetizing real products for real customers. That takes time, but the value is there, and the market is now evolving at a much more realistic pace. So are CSPs.
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