Jean-Pierre Muzard Business Development Manager, Global Service Provider Team
October 2012
Internet of things, Machine To Machine Terminology
Opportunity & Market Drivers
Use Cases
Business Models
End-2-End Architecture
Eco-system Partners
Apps Apps
Communication
IoT
M2H M2M
Robotics, Environmental sensors,
Vehicle Telematics, RFID,
IP light bulbs, LBS
, LOC sensors
Technologies
• The Internet of Things term is well-understood and widely adopted by several industries
This is new types of devices connected using IP technologies to private and public IP networks
Devices are sensors, actuators, tags, cars, engines, radars, video cameras, … not just highly constrained objects
A variety of link layers: low power and not so low power (IEEE 802.15.4, Wifi, 3G/4G, whitespaces, satellite, GPS,…)
• The Machine-to-Machine term is widely used mostly in the Service Provider environment
Machine-to-Machine (M2M) is the automatic communication between devices without human intervention.
M2M uses 2G, 3G, 4G, LTE connectivity, but also wired connectivity
Some of the most common M2M applications are telemetry (e.g. utility meters), telematics (e.g. car navigation systems), sales and payment (e.g. vending machines), and fleet management (e.g. cargo tracking).
Internet of things, Machine To Machine Terminology
Opportunity & Market drivers
Use Cases
Business Models
End-2-End Architecture
Eco-system Partners
Cisco Visual Networking Index, 2011
By 2015: M2M traffic will grow by 258%.”
By 2020: 50 billion connected IP devices
Cisco Visual Networking Index, 2011
By 2014: Managed mobile M2M services market will be $20B.”
ABI Research, 2010
CY 2012
“Vertical M2M”
Source: Ericsson
“Social Networking of
M2M”
Trillion
IoTs
IP End Points
Evolution of IP and Mobile Networks
Million
PC / Laptop
Billion
IP Device
Office & Home
Trillion
Wireless M2M End
Points
Cloud Services
The Evolution of
IP NetworksThe Evolution of
Mobile Networks
Billion
Mobile Voice,
Internet, SMS
Million
Voice
Social Networking of M2M
“Connected Network Society”
Market Category M2M Solution Examples
Insurance (Telematics) GPS, wireless
modules
Building or Home Management
Smart Appliances
Industrial Monitoring and Automation
Industrial Asset Monitoring
Fleet Management
(Telematics)
Vehicle Asset Monitoring
Public Safety and Security Environmental Asset Monitoring
Market Category M2M Solution Examples
Oil and Gas Solutions Equipment Monitoring
Healthcare and Life Sciences
Remote Diagnostics
Transportation (Telematics) Vehicle Management
Retail Sector Point-of Sale, Vending
M2M device connections by segment, worldwide, 2010–2020 [Source: Analysys Mason, 2012]
0.0
0.5
1.0
1.5
2.0
2.5
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Con
nect
ions
(bill
ion)
Utility
Security
Automotive and transport
Healthcare
Government, retail and financial services
10
Chipset • Big players dominate market
• High cost of chipsets
• Scale gains
• Cost will be driven down by 30%
Module • High cost
• High Power Consumption
• Proprietary
• Cost will be driven down by 50%
• Smaller Size
• Plug and play
Device • Operators certification
• Lack of standardization
• Standardization
• More devices
• Use of web interface
Network • 60% M2M service are based on GSM/CDMA network, 40%
on 3G.
• 70% M2M service are running on 3G, 20% on 4G ( LTE). The rest 10% on
WiMAX/CDMA, GSM.
• Lower network cost
• Higher bandwidth usage
Platform • Less than 10% M2M applications were developed by
platform.
• 70% of the M2M services come from developers that developed their
services on the M2M platform.
Application •55% revenue comes from smart grid and vehicle Telematics.
Highly concentrated in utility and vehicle markets.
• More than 60% revenue comes from asset and people tracking, logistic
management/healthcare diagnostics/ consumer touch security applications.
Convergence of M2M platform and cloud computing.
• Convergence of M2M platform and cloud computing.
2011 2015
Implication: The M2M market is at an intermediate stage
Internet of things, Machine To Machine Terminology
Opportunity & Market Drivers
Use Cases
Business Models
End-2-End Architecture
Eco-system Partners
Vertical
Segment
Business Government Consumer
Automotive
Utilitie
s Finance Energy Healthcare Retail Logistics Manufacturing
Public/
Society
Consumer
Electronic
Telematics X
Track and Trace X X X X
Remote
Sensor/Monitoring X X X X X X X X X X
Smart Metering &
Grid X X
POS/Payment X X
Security X X X X X X X X X X
Connectivity X X X X X X X X X X
80% of M2M Requirements are Horizontal Capabilities (common across all
verticals)!
Internet of things, Machine To Machine Terminology
Opportunity
Use Cases
Business Models
End-2-End Architecture
Eco-system Partners
The value chain is very complex
Device Vendors
M2M Chipset Vendors
M2M Module Vendors
Application Developer
M2M SDP Platforms
M2M Service Distributors
Vertical specific/ System integrators
Infra Vendors
2004 & before 2005 2006 2007 2008 2009 2010 2011
De
ve
lop
ed
Ma
rke
ts
Em
erg
ing M
ark
ets
* Vodafone platform
* China Mobile
* Maxis
Launch
M2M
* NTT DoCoMo
* Softbank * nPHASE (Verizon Wireless)
* Telstra
* KDDI
* China Unicom
* China Telecom
* Celcom (Malaysia)
* Sprint NextTel & DataSmart & Aeris
* AT&T Platform
* SKT
* KT APAC
Early Adopters
APAC
Fast Followers * CSL
* Globe
* StarHub
* Reliance
* KPN platform
Source: Frost & Sullivan
* Telenor Connexion
M2M Chipset Vendors
M2M Module Vendors
M2M Device Vendors
M2M Service Providers
M2M Service Distributors
Vertical Industries & Enterprises Consumers
M2M Connection Providers
M2M Application Developer
Model 1: Device Driven Model Telco:
AT&T
Consumers Amazon
Kindle Amazon
Telco:
Sprint
Business &
Consumers QUALCOMM
Model 2: Consortium Model Operator Driven Model
Various Partners
Verizon
Verizon
NPHASE Verizon
Number of Connections (end of CY2010) = 7-8 million from AT&T and Sprint
YoY Growth: > 250%
Number of Connections (end of CY2010) = 8 million from Verizon
YoY Growth: 16%
Model 3: Platform Model
(usually through partnerships) Telstra
Business &
Consumers
Model 4: Operator Driven Model
Business&
Consumers
Jasper
Wireless
Telstra
M2M
Platform
Vertical Industry
& Enterprise
Various Partners
( Verizon Wireless, China
Mobile, SKT, NTT Docomo )
Verizon Wireless, China
Mobile / SKT/ DoCoMo
M2M Chipset Vendors
M2M Module Vendors
M2M Device Vendors
M2M Service Providers
M2M Service Distributors
Vertical Industries & Enterprises Consumers
M2M Connection Providers
M2M Application Developer
Number of Connections (end of CY2010) = 9.3 million from AT&T
YoY Growth: 50%
Number of Connections (end of CY2010) = 2.1 million from NTT DoCoMo
YoY Growth: 45%
1 3 4
Telco
CAPEX
OPEX
Go To Market Speed
ROI
Scalability
M2M
Application
Provider
Investment
ROI
Go To Market Speed
Flexibility (Change
Connection Providers)
Scalability
Neutral Unfavorable Favorable
1. Device Driven Model 3. Platform Driven Model 4. Operator Driven Model
Source: Frost & Sullivan
Internet of things, Machine To Machine Terminology
Opportunity & Market Drivers
Use Cases
Business Models
End-2-End Architecture
Eco-system Partners
Business
Services
SAP/ Oracle
Bu
sin
es
s
Ap
pli
ca
tio
ns
As
se
t
(Se
ns
or)
&
M2M
GW
Applications
mHealth/ Fleet
Management / Industrial
Automation
Connectivity
Service
Ca
rrie
r S
P M
2M
Clo
ud
Se
rvic
es
Sys
tem
s I
nte
gra
tor
3G/4G/Wireline M2M GW
3G/4G/WiFi GPS M2M GW
2G/3G Modem
Data Mgmt
Service
Integration
Service
Application
Service Remote Service
Device Mgmt
Admin Service Security Service
Sensor # 2 Sensor # n
Sensor # 1
DevTools &
Open API
Asset Mgmt Billing Service
Policy Manager
Maintenance Mgr Big Data Mgmt
EPC
Netw
ork
-A
ware
VA
S
2G/3G Modem
2G/3G Modem
EPC
Personalization
Manager
Identity Mgmt
Ne
two
rks
EPC / BNG
Network, subscriber and Services Abstraction and Orchestration Layer
HTTP RESTful – SOAP XML – XMPP – One API
Apps Orchestration Layer
Data Analytics
Real-Time
Subscriber Mgmt
Network
Intelligence
Transport
Optimization
Inte
llig
en
t M
2M
N
etw
ork
Serv
ices
Compact Hardened
Services-Rich
Built for challenging environment –
shock/vibe, humidity, splash water,
temperature, dust
IOS-Based – ISR Compatible, Secure
native SMS Gateway with GPS Support
Industry’s Most Compact Hardened
M2M Gateway with Dual SIM
Flexible operations with ease of installation/deployment and lower TCO
Cisco ISR 819
Increased revenue with new business models
Greater efficiency with remote real-time monitoring with existing management
Mobile IP and IPv6 Ready
Internet of things, Machine To Machine Terminology
Opportunity & Market Drivers
Use Cases
Business Models
End-2-End Architecture
Eco-system Partners
• Manage Data Plan
(raise / lower
bandwidth)
• SIM management
(enable / disable)
• Report on data usage
• Powerful Rule Engines
(Automated control of
Assets)
• Firmware Over The Air
(Upgrade firmware,
push content to
Assets)
• Business Intelligence
and Reporting
Adjust Rate Plans Select higher-data Rate Plan before Asset receives a firmware
upgrade
Activate / Deactivate SIMs Deactivate SIMs when Assets are being seasonally warehoused
Track month-to-date Usage Lower reporting frequency of all Assets before Bandwidth Exceeded
Send single or bulk SMS Send SMS to “wake up” Assets and have them report data /
download updates
+
• SP(s) are key Partners for Cisco and will play a big role in the M2M market
• But it is not just a traditional Service Provider play!
• Both an Enterprise (e.g. Utility, Cars, …) and SP play
• Will stimulate the rise of new types of “Service Providers”
• Strong potential for Over-the-Top players
• Crucial Enterprise, Public Administrations, Government role
• Cisco End to End Infrastructure for IoT/M2M leverage Service Provider mobile and fixed
network and cloud infrastructures, it is the foundation for delivering network aware business
mission critical application.
• To develop and deliver M2M services Service Provider need to build partnership with M2M
platform vendor, application developer, system integrator and enterprises.
• ABIresearch® Maximizing Mobile Operator Opportunities in M2M: http://tools.cisco.com/search/display?url=http%3A%2F%2Fwww.cisco.com%2Fen%2FUS%2Fsolutions%2Fcollateral%2Fns341%2Fns523%2FABI-
CISCO_M2M_Operator_Opportunity.pdf&pos=1&strqueryid=2&websessionid=DJMvPuefgiNniOw-Ym3FBqP
• Machine-to-Machine and Cloud Services: Monetize Next-Generation Communication http://www.cisco.com/en/US/solutions/collateral/ns341/ns849/ns1098/white_paper_c11-663879.pdf
• M2M http://www.cisco.com/go/m2m
Thank you !