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A life that is fully supported by automated machines may sound like a science-fiction, but soon, this may turn out to be a reality. The world is heading towards a remote-controlled lifestyle where people will exploit the ubiquitous presence of broadband to keep a tab on not only their businesses, but their day-to-day lives too. How is that likely to happen? Well, that can only be possible when machines begin communicating with each other.

Going by the fundamentals of any business, there are physical limits to the number of telephone connections that can be sold to human beings. However, the machine-to-machine (M2M) communication can have the potential to take this opportunity to an order of billions. Mobile operators in particular are looking at the explosively growing M2M market as a major source of new services revenue. However, the commercial success of this possibility rests on various factors, including standardization of the protocols and simplification of the applications.

World over, telcos have dabbled in M2M services for years. But, the market for wireless M2M applications has been a sleepy one and was limited to industrial uses such as smart grid utility meters sending data over cellular networks. Now, the carriers have the opportunity to tap into what's expected to be a lucrative commercial and consumer market for wireless M2M applications embedded into non-traditional devices. The service providers are seeing a bigger opportunity for wireless M2M applications because chipsets are getting smaller and cheaper, opening the door for connecting non-traditional commercial and consumer devices to carrier networks. In India too, the operators are moving towards M2M applications.

Every object with an embedded mobile SIM card, excluding mobile phones, is included in the M2M market. Operators are starting to view the market for embedded devices and M2M as a market in its own right, rather than an add-on to the existing activity. Analysts predict that to effectively address the market for embedded devices and M2M, operators need to consider re-appraising accounting practices and form alliances and partnerships with M2M specialists. Already there is a growing trend for SIM cards to be integrated directly into the devices, rather than be provisioned at a later date in the 'aftermarket'.

According to Juniper Research, revenues from mobile connected M2M and embedded devices will rise to $18.9 bn globally by 2014. One-third of the revenues will come from consumer and commercial telematics and vehicle applications. Some other areas which will contribute significantly to M2M revenues include mobile connected buildings, alarm systems, smart grids, and tracking devices watched from a monitoring center. Research finds that the automotive industry remains the most promising M2M area.

In India, big operators like Reliance Communications are focusing on high impact M2M applications for the rural market. These are mobile applications that aid automation, surveillance, remote monitoring, and data gathering. The major focus of Indian operators is on the rural market. The focus is also on developing applications that enable automation of agro and irrigation services, water level monitoring, and data gathering for milk and agri-cooperatives, fisheries, poultry, and soil analysis. However, for the urban market, the opportunity lies in mobile ticketing, purchasing in kiosks, vending machines, and remote monitoring of office automation products. Both Reliance and Airtel have been competing to get their share in this space through metering applications.

Industry experts say that mobile operators who haven't yet started to explore M2M services opportunities need to get on to the M2M bandwagon. Experts believe that M2M applications will provide new revenue streams and new partnerships for mobile operators, allow the cross-selling and up-selling of complementary services, and provide a new way to drive customer stickiness.

"The broadband networks with predictable behavior are fundamental to M2M. We need to spread the broadband networks which are at all times connected to remote villages and interconnect these to deliver value through M2M. This will take telecom closer to telematics with the interconnection of synchronized operations," says Vipin Tyagi, director, Center for Development of Telematics (C-DOT).

According to him, all automated B2B sites like travel, matrimonial, ticket booking and many more such sites may qualify for machine to machine business process realization category.

"The real potential of the network will be exploited only when a series of activities start happening with the cooperation of different machines at different locations based on a predefined logic. The M2M market is going to be of the same order as data traffic is over a converged network. Sensor networks , ad-hock networks, ubiquitous computing are the manifestation of the growing need for M2M," he says.

Prem Nithin, senior technical consultant, Cisco, India and SAARC says, "M2M market in India is in a very nascent stage. We have seen some basic M2M communications so far. Going forward, we hope to see high-end M2M applications being deployed in the Indian market. Advanced technologies like unified communications, video surveillance will be integrated in M2M communications, and will deliver superior services both for enterprises as well as consumers."

The rapidly growing M2M communications arena is finally coming of age. These applications can leverage mobile Internet and billions of minuscule sensors to provide new consumer and enterprise revenue opportunities.

"With the increase in rural teledensity, the adoption of rural centric VAS application is likely to gain momentum. Irrigation, water table monitoring, meteorological updates and real-time cooperative market updates are some of the areas wherein M2M apps are likely to play a pivotal role," says Pushpendra Mankad, senior VP, Comverse Asia.

Challenges Galore
If M2M was such a big opportunity, why are the Indian operators not very aggressive here? There are some key challenges that have been blocking the way of the carriers to exploit the potential of these applications.

"Lack of penetration of the broadband predictable networks, and lack of focus and demand for these apps have been hindering operators' plans," Tyagi says.

He explains, "We need to take a risk and have a vision for the adoption of M2M. We need to look at the problem from the perspective of networks and not Internet. Internet is already choking. So, there is a need for indigenous R&D for solving education, water management, government programs' management using broadband networks."

Operators also need to adopt aggressive new business models to exploit the M2M opportunity. ARPU for connected M2M devices is much lower compared to mobile broadband subscribers. This can be problematic for operators where an industry indicator of the overall financial health is the growth or decline in the overall ARPUs. Of course, the number of potentially connected M2M devices is expected to dwarf the number of mobile broadband subscribers. M2M also brings with it specific customer support requirements, often including expertise that operators may not have in the key M2M applications.

Nithin suggests that for delivering high-end M2M applications, it is extremely important for different components of a network infrastructure to collaborate effectively, for which service providers need to upgrade their network infrastructure.

3G for M2M
There has been much hype around 3G, calling it the ultimate technology that will change the way people in India lead their lives. It is promising applications supported by a high bandwidth. One school of experts say that the unavailability of advanced technologies like 3G/WiMax prevent service providers from deploying high-end M2M services, which require greater bandwidth. It is true that some M2M applications such as video surveillance, transportation fleet management, etc, require high speed data connectivity, for which advanced wireless technologies like 3G will be required.

Interestingly, another group in the industry says that the delay in mass rollout of 3G will not be a deterrent for these services in the country. The reason for this is that except certain consumer applications such as mobile gaming and e-readers, 3G's use for M2M applications will be limited in the immediate future. This is because M2M usually does not require the high bandwidth that 3G affords.

Heena Jhingan
heenaj@cybermedia.co.in

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