Standards development to drive M2M market, GPS on mobile to see disappointing uptake

The move to a standard size in radio modules will help drive greater adoption of wireless in the machine-to-machine (M2M) market in 2008, while adoption of personal navigation services through GPS on cell phones will disappoint, according to Deloitte's Technology, Media and Telecommunications 2008 predictions. Speaking in Ottawa last week about the predictions, Duncan Stewart, director of Deloitte Canada Research and president and CEO of Duncan Stewart Asset Management Inc. said while there has been tremendous technological revolution over the past decade, this year's predictions relate more the implications of those developments. The M2M space is one area that will greatly benefit from previous innovations in wireless communications. With the wholesale cost of some mobile phones to drop to $10 in 2009, the opportunity to wirelessly enable everything from vending machines to photocopiers to home security systems and vehicles is huge. According to Deloitte figures, there were more than 1.1 billion generic machines in the US, yet in 2007, only 2% of them were connected to a network. Stewart said, though, that to capture the present opportunity all the players in the M2M value chain will have to work together in developing standard radio modules, particularly when it comes to their size. "For mobile to be deployed in machines on a large scale, the cost of deployment, as well as the cost of the module itself, should be minimized," reads the 2008 predictions report. "Mobile manufacturers should work closely together to develop a single, globally recognized standard that includes specific guidance on size. Businesses will integrate mobile modules into their devices only if standards covering specifications of the mobile modules themselves and their communications protocols exist."Wireless vending machines are nothing new, but Stewart said part of the reason it didn't take off in the past was because companies were developing their own proprietary solutions. But now with the cost of wireless radios dropping dramatically, he added, this can be done cost effectively and in a standardized manner. "We've basically come down a curve so that the stuff that's in ...and is basically the wireless equivalent of a 56K modem," Stewart said. He added that the carriers already have 2G networks that they have to keep running, so it only make sense to use them. The opportunity for Canadian firms to benefit from the M2M space won't be in module manufacturing or development, it will be in the applications and services space, according to Stewart. He points to firms such as WebTech Wireless Inc., Cell-Loc Location Technologies Inc. and Grey Island Systems Inc. that can leverage greater wireless communications among machines. While the future seems bright for the M2M market, if Deloitte's predictions hold true, widespread consumer adoption of GPS on handsets will experience the opposite fate in 2008. "Don't expect to use it everyday," Stewart said. Despite the big jump in the number of GPS devices from the likes of Garmin, TomTom and others - Deloitte estimates that in 2006 there were 20 million unit sales - usage of GPS in cell phones won't be as robust. "The standalone device is one thing, but do not translate its success ," Stewart warned. There are also other factors that will inhibit the success of GPS on cell phones, according to the Deloitte analyst. GPS is a power hog, and signals don't work indoors and sometimes are blocked because of tall buildings in downtown cores. As well, signal accuracy of GPS isn't required in most cases. "I need five-metre reliability if I'm hiking in the Rockies and I don't know where the hell I am," Stewart said. "I don't need it when I'm at the corner of Metcalfe and Queen "

Standards development to drive M2M market, GPS on mobile to see disappointing uptake

News | 01/29/2008 6:05 pm EST

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