M2M Communication in Smart Cities & Public Transport 2011-20
Machina Research, June 2012
"Smart Cities & Public Transport is a diverse sector with a wide range of different public services, all of which can substantially benefit from M2M, in particular through driving efficiency savings. In most cases, each service has been conceived and developed often over a number of years as an independent silo, with little integration, interdependence or communication built in between services. The challenge with retrofitting existing cities will be to link up some of those independent silos where appropriate. Facilitating communication between traffic management systems and public transport vehicles is an obvious example but there is scope for wider “horizontal” platforms, accommodating a number of “connected” services. M2M is instrumental in enabling this communication."
Michele Mackenzie, Principal Analyst
The Smart City sector is deploying M2M across a diverse range of public services and infrastructure comprising Public Transport, Traffic Management, Environment and Public Safety and Public Space Advertising and represents a sizeable opportunity for market players. The market will grow from 59 million connections in 2011 to 512 million in 2020.
While Traffic Management generates the lion's share of connections, reaching 446 million by 2020, it is the Environment and Public Safety group of applications, driven largely by CCTV deployment, which generates the most revenue. Machina Research predicts that this will be a EUR 7.5 billion opportunity globally by 2020. However, whilst Environment and Public Safety represent the largest market in terms of revenue, it is relatively mature and revenue growth is slow at 7%. Overall revenue from Traffic Management is smaller at EUR5.6 billion in 2020, but this application group experiences higher revenue growth over the forecast period with a CAGR of 22%.
Emerging Asia Pacific is the region which drives the most revenue, accounting for 59% in 2011 and remaining as high as 44% in 2020. This is largely due to China's nationwide deployment of CCTV and its continued growth in this area over the forecast period. Europe will also constitute a large share of the revenue, comprising around 24% in 2020.
Commenting on who is best placed to take advantage of the burgeoning Smart City opportunity, Mackenzie said: “Smart City projects are by nature large and complex and there are no ‘one size fits all' solutions. They require the expertise of a number of industry players hence there are substantial opportunities for vendors, systems integrators and fixed and mobile network operators in this market and more importantly partnerships between players.”
About the report
Machine-to-Machine (M2M) Communication in Smart Cities & Public Transport 2011-20 provides invaluable qualitative and quantitative analysis of the emerging opportunity for machine-to-machine communications in five key areas:
- Public Transport (road, rail, air and sea transport as well as ticketing and passenger information systems)
- Traffic Management (parking space management and payment, congestion charging and road tolls, traffic volume monitoring, connected road signs, traffic lights and enforcement cameras and in-vehicle congestion and toll devices)
- Environment and Public Safety (CCTV, street lighting, waste collection, public alarms and intercoms and tourist information services)
- Public Space Advertising (static advertising and billboards).
The report reviews the major drivers and barriers for growth of M2M in the sector and analyses the key market dynamics, including how MNOs, fixed operators, service providers and vendors might go about identifying and realising addressable opportunities.
The forecast excel data sheet includes very granular 10 year market forecasts for 54 countries and 6 regions. The forecast covers numbers of connections, traffic and revenue for each of the identified application groups with splits by technology (short range, 2G, 3G, 4G, MAN, fixed line and satellite) and a break-out of mobile traffic revenue.
1 Executive Summary
1.1 There is no “one-size-fits-all” strategy for smart cities
1.2 Smart cities: a raft of diverse services and applications
1.3 Connections exceed 500 million by 2020 and revenue grows to EUR14.5 billion
2 Contents
3 Scope
4 Drivers and Barriers
4.1 Drivers
4.1.1 Accelerated urbanization takes its toll on city infrastructure and services
4.1.2 Cost efficiency is driving M2M adoption in public infrastructure and services
4.1.3 Economic stimulus plans help drive smart city initiatives
4.1.4 Reducing the carbon footprint is a key driver for smarter public services
4.1.5 M2M connectivity facilitates communication between public service verticals
4.1.6 M2M connectivity gives rise to new services
4.2 Barriers
4.2.1 Fierce competition for funding
4.2.2 Retrofitting existing cities is complex and expensive
4.2.3 Lack of central governance for some public services
4.2.4 Open standards are critical
4.2.5 Data privacy – or lack of- is a cause for concern
5 Smart Cities & Public Transport Market Analysis and Forecast
5.1 Key market developments
5.2 Market dynamics
5.3 Market forecast
6 Application Analysis and Forecast
6.1 Public Transport
6.1.1 Definition
6.1.2 Application Market Analysis
6.1.3 Forecasts
6.2 Traffic Management
6.2.1 Definition
6.2.2 Application Market Analysis
6.2.3 Forecasts
6.3 Environment and Public Safety
6.3.1 Definition
6.3.2 Application Market Analysis
6.3.3 Forecasts
6.4 Public Space Advertising
6.4.1 Definition
6.4.2 Application Market Analysis
6.4.3 Forecasts
7 Recommendations
7.1 Fixed and mobile network operators
7.2 Systems integrators and IT vendors
7.3 Equipment vendors
8 About Machina Research
8.1 Forecast Database
8.2 Reports & Research Notes
8.2.1 Reports
8.2.2 Research Notes
8.3 Strategy Briefings
8.4 Analyst Enquiry
8.5 Custom Research & Consulting
8.6 Our people
Jim Morrish
Jim Morrish is a respected telecommunications industry expert, with over 18 years' experience of strategy consulting, operations management and telecoms research.
Most recently at Analysys Mason he was responsible for launching the Mobile Content and Applications research programme. Previous experience includes strategy consulting for Booz&Co, project management and board membership at Cable & Wireless, Head of department at the BBC and also work as a freelance consultant. He has worked on-site in in excess of 25 countries through Europe, Asia, Africa, the Middle East and the Americas, and undertaken strategy planning and forecasting work covering nearly all significant markets worldwide.
Recently his focus has been mobile-oriented services, including the impact that providing such services can have on a mobile operator's relationship with its customers. Jim is widely quoted in both the trade and national and international press. He is speaks frequently at conferences, and acted as a judge for the GSMA's 2011 Global Mobile Awards. He holds an MA in mathematics from Oxford University.
Matt Hatton
Matt Hatton has 15 years' experience at the cutting edge of telecoms research. Prior to establishing Machina Research, Matt was Program Manager at Yankee Group focusing on the mobile services market in EMEA and most recently at Analysys Mason he was Research Director managing all research on the telco services market, with a particular focus on mobile broadband and other new emerging services and business models. He has provided strategic advice to numerous executives (including C-level executives) at mobile operators, vendors and other players in the mobile value chain, on the deployment and marketing of mobile products and services.
This has included market sizing and forecasting, providing competitor intelligence, and advising on strategies for value-added services, M2M, mobile broadband, customer retention, pricing and fixed-mobile convergence. He also has substantial experience in carrying out business case assessments for mobile operators, including due diligence on service deployments.
Matt is widely quoted in both trade publications (such as Total Telecom, Light Reading, Mobile Today, New Media Age and Mobile Europe) and the wider national and international press (including BBC, The Financial Times, CNN, The Telegraph and The Independent). He also speaks frequently at conferences and acts as a judge for a number of prestigious awards (including the GSMA's Global Mobile Awards). Matt holds an MSc in Telecommunications (Distinction) from University College London.
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