Until recently, major manufacturers in automotive and consumer electronics have been held back from large-scale deployment of connected devices due to the complexity of delivering connectivity across international borders, especially when requiring high bandwidth. Now a new service, provided in partnership by leading mobile operators, could help to propel M2M into the mass market. Real Times spoke with Emmanuel Routier, vice president of global M2M at Orange Business Services at Mobile World Congress in Barcelona to find out more.
Cellular M2M communications is a maturing technology. Analyst Ovum estimates that there are already 224 million cellular connections. And yet there are forecasts of staggering growth to come. The GSM Association suggests that if the right market conditions are achieved, there could be up to 2 billion cellular M2M connections by 2020, comprising 20% of all mobile connections.
What are these favorable conditions? “To fully unlock the M2M market opportunity for both consumers and businesses, we need industry-wide collaboration to address the current fragmented marketplace and to drive economies of scale and global interoperability,” said Hyunmi Yang, Chief Strategy Officer at the GSMA.
According to Emmanuel Routier, vice president of global M2M at Orange Business Services, “one of the key areas where cooperation is needed is in multinational connectivity. Most of the products we all use daily have been made in a global production center. And manufacturers in automotive, consumer electronics and healthcare want to deploy their connected 'products' throughout multiple markets in a consistent, uniform manner.”
Until now, the mobile industry struggled to do this, especially for certain key consumption profiles. The industry is fragmented to a certain extent with different technologies and frequency bands around the world, and regulation on a country by country basis.
Consequently, early adopter manufacturers have had one of two routes: either install a roaming SIM, which can work in virtually any country or insert a local SIM card in the factory or when the device reaches its destination.
But neither of these options is attractive:
- Roaming is only suitable when the data usage is low and so it is unsuitable for an LTE-enabled connected car transmitting gigabits of data every month. Furthermore, in some countries, devices permanent roaming is not permitted.
- The alternative, inserting a local SIM, is not ideal either. “It means the device cannot be properly tested before it leaves the factory floor and the manufacturer would need a large and complex inventory of different SIMs and modems that are approved for working in different networks,” explains Routier.
And that’s just the manufacturing headache. The OEM would also need to negotiate with every single operator, manage the billing from multiple markets and somehow provide consistent customer support. “When the volume of M2M devices that needs to be managed is in the hundreds of thousands or even millions, this complexity can undermine the whole business case,” adds Routier.
In short, manufacturers have been waiting for the telecoms industry to devise a solution to the international connectivity puzzle that can enable M2M to go mass market and achieve the levels forecasted by the GSMA.
connectivity for global manufacturers
The Global M2M Association, an alliance of leading mobile operators, which includes Orange Business Services, has developed a unique connectivity management service specifically for the needs of large manufacturers. The Multi-Domestic Service allows them to build once, run anywhere and thereby catapulting connected devices into the mass market.
“We are one of the founders of the GMA because we recognized that as an industry, we needed to cooperate to solve global connectivity challenges. To help manufacturers achieve their M2M vision they need one consistent platform wherever their devices are used. In the GMA, we are all Tier 1 operators. We have the best networks and top quality support processes and our technology partners Ericsson (connectivity management) and Gemalto (SIM management) are also Tier 1,” says Routier.
Multi-Domestic Service features a single global management platform and an embedded SIM which can be used throughout the GMA footprint of 33 countries (and growing). What this means is manufacturers can install a SIM card in a factory in Japan, test the connected device works, and ship it to Canada. When it is sold and turned on in the destination market, the profile of the SIM card changes to the local GMA operator and switches to a preferred local (not roaming) tariff. This also ensures that the users enjoy the same high quality service, whether they are in Italy, Canada, France, Spain or Norway. And the manufacturer has a global view of the connected devices and their status.
Furthermore, the Multi-Domestic Service introduces different charging models. Traditional M2M has been very much a B2B play. But the new service enables B2C and B2B2C charging.
“M2M has been around for a long time but in a silo: a machine talked directly to a back office and this was a simple B2B business model,” says Routier. “The Internet of Things (IoT) has introduced another element. OEMs can connect their devices but also the users to interact with those devices – which means they can offer them new value-added services. In a car, that could be rear seat entertainment and the business model of who pays for that entertainment is flexible.”
“For a premium model, the car manufacturer may choose to subsidize the connectivity charges, but in a mid-range model, they may offer telematics as a service, but expect the driver to pay for the entertainment data,” he adds. “The Multi-Domestic Service allows manufacturers to have different business models.”
The Multi-Domestic Service is a major development for manufacturers with international M2M ambitions. It helps to reduce complexity; ensure consistent customer experience across borders; offers the flexibility to offer different business models; and assists with accelerating time to market.