KPN, NTT DoCoMo, Rogers Wireless, SingTel, Telefonica, Telstra, and Vimpelcom have announced that they will cooperate globally in M2M. All these operators use M2M connectivity platforms provided by Jasper Wireless. The plan includes technical cooperation in developing a “seamless” global solution for MNC customers, and the operators will also work to improve customer experience. SIM status and the performance of M2M devices across the globe will be managed from a single web interface using Jasper Wireless' Control Center.Telefonica’s bid to form an alliance of operators using the same M2M connectivity platform should come as no surprise. Cross-border operator alliances are a necessary component of an M2M market in which the biggest potential comes from business-to-business-to-consumer (B2B2C) opportunities dominated by global brands. However, whether such deals, which are still less than global, are enough to kick-start the vision of a connected world remains to be seen.
B2B2C applications are expected to be a major growth area in M2M, with a trend towards more global implementations to support MNC customers. For example, consumer electronics manufacturers providing services to consumers are likely to need global support. However, they will not want to negotiate agreements in different markets as this will not generate the required operational and cost efficiencies.
Many operators prefer to use a third-party service delivery and management platform for M2M deployments, particularly in B2B2C contracts with global requirements. This approach makes sense as it simplifies M2M for operators and allows them to adopt a flexible approach to M2M deployment. The realization that other operators are using the same platform is expected to open more doors for global contracts.
It is hoped that the alliance will stimulate the growth of M2M solutions, and lead to a reduction in operational costs in high-potential industries such as consumer electronics, automotive, and energy efficiency. This will enable the development of new business models and the creation of new vertical products and services “beyond connectivity”.
Telco partnerships the way to go
As no mobile operator has global wireless assets, a partnership or alliance was always going to be required to serve MNC customers, whether this took the form of a global roaming partnership or an alliance between operators using common M2M platforms. Telefonica has the most aggressive telco partnership strategy in M2M, with the operator recognizing early on that it did not have the necessary coverage to serve MNCs on its own. It has recently announced M2M partnerships with Avea, Etisalat, Telenor, and China Unicom. Telefonica and China Unicom recently demonstrated a solution for remotely managing M2M SIM subscription data in a test that also included Telstra.
Telefonica’s announcement follows a number of similar agreements in recent months. Orange, Deutsche Telekom, and TeliaSonera recently formed the Global M2M Alliance, which is a group that also formed the FreeMove MNC alliance (although the fourth FreeMove partner, Telecom Italia, has yet to join the Global M2M Alliance). Vodafone has the best global international coverage of any operator, and has not yet announced any major partnerships. However, Vodafone does work with Verizon on some MNC deals despite the fact that the two operators do not share a common M2M connectivity platform.
Who join the alliance next?
The alliance is open to other operators, and we expect that others will join as the initiative builds momentum. A number of operators, including Etisalat, CSL (a Telstra subsidiary), Optimus, AT&T, and America Movil, already use Jasper Wireless’ platform. The US is the most obvious missing link in the alliance, and AT&T has indicated that it is keen to partner on global deals. While AT&T would have been expected to partner with other Jasper Wireless operators for M2M deals, it recently partnered with Telenor (which is not a Jasper platform user) to provide European connectivity on the Nissan Leaf deal.
AT&T’s close links with America Movil in South America may prove to be a sticking point for Telefonica. However, such interests do not seem to have been an issue for SingTel, which has joined the alliance even though it includes a direct competitor to one of its subsidiaries. This could signal that operators are taking a more realistic and mature approach to partnering that reflects the desire to put the needs of customers ahead of competitive concerns.
Pauline Trotter is a principal analyst specializing in enterprise communications at Ovum