Asia Pacific is leading the world in the adoption of machine-to-machine applications, according to the Vodafone M2M Barometer 2015. The research, in its third year, is based on respondents from 659 interviewees from 16 countries across 7 vertical industries. Over 250 respondents were from the Asia Pacific across six countries – Australia, India, Japan, South Korea, China, and New Zealand.
According to Vodafone M2M director, Asia Pacific Justin Nelson, Asia Pacific now leads the world in M2M adoption, with 35% of the survey respondents acknowledging usage of M2M communications, up from 27% in 2014 and just 12% in 2013. In comparison, Europe’s M2M adoption rate stood at 31%, up from 21% a year earlier. Europe however, posted the fastest growth rate at nearly 50%.
Nelson attributes Asia Pacific M2M leadership to regulatory initiatives to encourage adoption, particularly in Korea, China and Hong Kong.
Globally, adoption across different vertical industries varied, according to the Barometer report. Not surprisingly, energy and utilities led the pack with 37% of the respondents citing M2M usage, followed by the automotive and retail sectors – both at 32% adoption. Consumers electronics (29%) and healthcare and pharmaceuticals (28%) followed, outpacing transport and logistics (19%) and manufacturing (17%).
In addition to just adoption rates across regions and industries, the Barometer also looked at organisations’ experiences of M2M and its impact on their business.
One of the most encouraging findings from the Barometer was that 81% of those who said they were using M2M a year ago said they have increased usage.
More importantly, M2M is no longer seen as a cost component for businesses with 50% of the respondents pointing to M2M as drivers for new business and operating models, while 59% of M2M users cited “significant” return on investment, and 54% of M2M users reported ROI within 12 months.
Cost savings also played a part in the equation. On average organisations who have deployed M2M enjoyed cost savings of 18%. Nearly 10% of M2M adopters reported cost savings of over 25%, the survey found.
Despite the positive take up rates, a number of barriers remained. Security and privacy were identified 33% and 31% of the respondents respectively as the prime concern for M2M adoption. Other major concerns were high costs relative to potential benefits (29%), lack of knowledge (26%), and unproven technical performance/reliability (25%). Somewhat more positive was the findings that only 20% of the respondents cited management resistance, or regulation, as impediments to M2M.
“When you see some of the numbers, it is ‘here, now, and real,’ verses ‘it’s another big bubble, or something exciting that is going to fizzle out’,” Nelson said.
Australia and New Zealand
Speaking specifically of Oceania, Nelson pegged New Zealand as a leader, but opined that more could be done in Australia.
“Australia’s M2M market is not as mature as for example New Zealand, which is more advanced,” he said. “New Zealand is far advance only because they started earlier, and their 2G solutions have been in place in utility for some time. Effectively, they have completed the utilities roll out there, so now they are moving on to more advanced things like agriculture… They are doing smart things on water monitoring to increase the value of water in farms.
“I think for the Australian market, we are not seeing the same level of innovation yet. Although they are still strong in the traditional utility, automotive, security, but they are not seeing innovations like in other markets [such as a tire pressure monitoring service by a Chinese M2M partner of Vodafone].”
According to Nelson, who is based in Australia, the service providers there have been “complacent” towards M2M to date because they have been focused on mobility. However, that is changing at Vodafone, which now sees M2M as a “break out” product.
“M2M is more of a leading product of Vodafone now, we have put in the capability, and we’ve had some wins with global health customers, and now we have won an utility customer, and an Australian company choosing Vodafone is quite significant,” he said.
New regulatory developments such as the “power of choice” rule for the utilities market in Australia will be stimuli for M2M, he added.