Measuring the machine-to-machine market in mobile is notoriously difficult because there is no standard, industry-accepted method of reporting M2M statistics. However, according to an analysis and estimates by research firm Current Analysis, AT&T Mobility (NYSE:T) leads the market with fully 14.7 million M2M connections.
The news is notable considering General Motors earlier this year announced it will replace Verizon Wireless' (NYSE:VZ) service with AT&T Mobility's service in its OnStar offering beginning in 2014. The news represented a significant blow to Verizon, which has powered OnStar's service since it launched in the 1990s.
As Current Analysis analyst Kathryn Weldon noted, "AT&T is the only U.S. operator that has been providing customer wins routinely, and it would behoove the other three major U.S. mobile operators to follow suit."
Further, Weldon said Current Analysis estimates for Verizon's M2M connections range between 7 million and 9 million, but that GM vehicles with OnStar subscriptions accounted for fully 6 million of that total. "Presumably in 2014, when AT&T takes over this contract for next-generation vehicles with 4G connections, Verizon's OnStar numbers will start to decline," Weldon wrote.
Current Analysis estimates that Verizon currently counts roughly 8 million total M2M connections.
Most in the industry agree that AT&T enjoyed a leg up on Verizon in the early days of M2M thanks to AT&T's GSM-based network. Since GSM is far more widely deployed on a global basis than CDMA, which Verizon uses for 3G, AT&T was able to leverage both a larger purchase base and broader distribution for M2M services. However, that situation could change in the years ahead as both Verizon and AT&T shift their traffic to their respective LTE networks.
As for Sprint (NYSE:S) and T-Mobile US (NYSE:TMUS), Weldon said Currently Analysis estimates Sprint had around 3.3 million connected devices as of the end of the second quarter. However, she noted the carrier has been feverishly working to increase that number, and pointed to deals from the past year with the likes of Chrysler, Audiovox Car Connection and Metrum Power Insight.
As for T-Mobile, Current Analysis said the carrier ties with Sprint with 3.3 million M2M connections. The firm noted T-Mobile primarily runs its M2M business through MVNOs including RACO Wireless, Wyless, and Jazz Wireless.
Informa Telecoms & Media recently reported the global cellular M2M market is growing steadily and is on track to reach 315 million connections by the end of 2015.
Qualcomm to sell Omnitracs fleet management biz for $800M
Analysys Mason: Global M2M Association members need a common connectivity platform
Infonetics: In the limitless world of M2M, focus is table stakes for success
Can Sprint steal AT&T's 2G M2M business?