The new embedded ecosystem

One of the big impediments to the embedded wireless device vision is getting all those gadgets--from e-readers to netbooks to digital cameras--provisioned on the network and set up so that customers are billed appropriately for their wireless usage. In some models, such as the Amazon Kindle, the wireless connectivity is bundled into the price of the device. However, most embedded device experts expect there to be numerous business models depending upon the device and the bandwidth it requires.

AT&T recently made strides in its embedded wireless vision through a new, exclusive deal with machine-to-machine (M2M) firm Jasper Wireless. Under the agreement, Jasper provides the activation, billing and connectivity support for all the embedded wireless devices (both consumer and M2M) that AT&T connects to its network.

This may sound like typical back office support--but it's not. The two firms plan to work closely together; AT&T is the exclusive carrier for Jasper in the U.S. market. For Jasper, this deal means that the M2M firm can now offer customers (such as a consumer electronics device maker) the ability to deploy a device in the U.S. and in another country where Jasper has a carrier deal, such as KPN in the Netherlands, without having to retrofit products.

But perhaps the most critical element to this deal, according to Jasper's Cindy Patterson, is the total cost of ownership figures. Patterson, executive vice president of worldwide sales and marketing at Jasper, said embedded devices have a TCO of 90 cents per month--that's the cost to provision the device, provide customer care and other support. While it may not sound like a lot of money, when you consider that many of these devices will have an ARPU of $5 or lower, it is a substantial chunk. Patterson says Jasper's system can reduce the cost by 87 cents. "Carriers have to keep the costs down for this to make sense," Patterson says.

AT&T isn't the only carrier making strides in embedded wireless. T-Mobile USA recently launched an embedded SIM card for M2M solutions. The SIM, which the operator says is about the size of the head of a pin, is more durable than traditional SIM cards and can withstand extremes in temperature, humidity and motion.

That durability makes it perfect for applications including telematics or smart grids. T-Mobile says that Echelon's Networked Energy Services plans to put the embedded SIM in its smart meters.

For more on the embedded ecosystem, check out the FierceMarkets Embedded Wireless Device virtual event June 9. There will be a panel on the embedded ecosystem at 10 a.m. EST.