SAP: Smart Cities Seen As Top Beneficiary Of M2M

Machine-to-Machine is expected to generate $1.2 trillion in revenue by 2022, when M2M connections are expected to hit 18 billion, up from the 2 billion in 2011. According to a new study by SAP and Harris Interactive, the biggest benefits will be increased business insight, efficiency, productivity, collaboration and mobility. Almost 30% of IT decision makers (ITDMs) agree that smart cities would be the most beneficial outcome of deployment of M2M technologies.

Machine-to-machine and the Internet of Things are going to enhance existing business processes and change business models, said Suhas Uliyar, VP of M2M, SAP. “The survey really crystallized what is the business value, why invest… and the barriers to overcome.”

The majority of respondents from the six countries surveyed – Brazil, China, Germany, India, UK and US – view M2M as the natural evolution of the “consumerization of IT,” with India and China at 92% and 90% respectively, with the other four countries averaging 81%. SAP said the number of ‘things’ connected to the internet is expected to reach 50 billion by 2020, but today, M2M technology is primarily being used to collect vast amounts of machine and people-based data.

The ‘Internet of Things’ concept goes one step further by not only integrating machines, people, ERP and CRM systems, and other information sources like social media, but also analyzing and making use of all the data. Soon, people will interact with devices that in turn interact with data to deliver personalized products and services directly to the consumer in real time, stated the company.

For Uliyar, who just recently joined SAP, but first became involved with M2M more than a dozen years ago, the key findings weren’t a surprise. “What was surprising – to a lot of folks, not me – was the dominance of China and India to embrace BYOD, machine-to-machine and the Internet of Things.” He said the estimates are that China’s internal IoT would be around $160 billion by 2020.

M2M is becoming the natural evolution of technology, and the propensity to jump to M2M and IoT is becoming more open, he said. “IT is getting more involved in machine-to-machine than ever before… now becoming mass market”.

BYOD is the next generation of consumerization, and IoT is the next step, said Uliyar. “What we’re seeing is it’s now becoming a competitive necessity.”

He meets regularly with business owners, CIOs, IT executives, and even his first meeting chaired by the chief marketing offer ice. The key questions they ask are: how do I generate more revenue; how do I hold on to my customers; and how do I replace my competitors’ products.

Uliyar said a key objective of the study was what would be the obstacles to implementing IoT. “Security of devices is a big concern.” Another was the availability of expertise. A third was how to analyze all this data and do meaningful things with it.

The bottom line is it’s about time we started doing standardization in the world of things, he said. “The big difference between M2M and IoT, IoT is the Internet; and that is not quite as standard as M2M.”

From an SAP perspective, the company’s strategy is to be an M2M solution provider, said Uliyar. “We really want to hide all the instrumentation of M2M. Our goal is to provide that as a full solution.” The target market is not just the end user, but also service providers and device manufacturers, he added.

The survey was conducted online between January 15th and February 1st, with a total of 751 ITDMs interviewed, including: 125 in the US at companies with annual revenue of at least $500 million; 125 in the UK at companies with annual revenue of at least 100 million GBP; 125 in Germany at companies with annual revenue of at least 100 million EUR; 125 in China at companies with annual revenue of at least 10 billion CNY; 125 in India at companies with annual revenue of more than 500 crores; and, 126 in Brazil at companies with annual revenue of at least 75 million reais. An ITDM is defined as an adult (age 18+) who is currently employed, either full- or part-time, and has at least some influence in the selection of voice, data, and mobile telecommunications services.

 

 

Author: Steve Wexler

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