Analyst Q&A: Berg Insights - Developments in IoT/M2M Market

Analyst Q&A: Berg Insights - Developments in IoT/M2M Market

Berg Insight is a dedicated M2M/IoT market research firm based in Sweden. They specialize in all major M2M/IoT verticals such as fleet management, car telematics, smart metering, smart homes, mHealth and industrial M2M since 2004.

Berg Insight offers numerous market reports, detailed market forecast databases and advisory services. They provide custom research tailored to your requirements including focussed research papers, business case analysis, go-to-market strategies and bespoke market forecasting.

Today’s Q&A features co-founder Johan Fagerberg who talks to us about how IoT connectivity technology is developing and how fleet management systems are set to evolve by 2021. Make sure to check back tomorrow for part 2.

 

Q. What are the biggest developments in IoT connectivity technology?

The wireless M2M/IoT technology landscape is rapidly changing. 2G networks are gradually taken out of service to be replaced by more efficient 4G technology. At the same time, new enhancements are being added to the LTE standard to better accommodate typical M2M use-cases with large numbers of devices and very low data requirements.

In a few years, LTE-M wireless modules will be available for the same price as today’s GPRS modules, delivering superior performance using less network resources. A new generation of LPWA technologies hit the market during 2015, offering an alternative roadmap to low cost IoT connectivity outside of the traditional mobile network environment. At the end of the year, the established players in the telecom industry however took back the initiative.

In December 2015, the 3rd Generation Partnership Project (3GPP) accepted the new NB-IoT standard for lightweight M2M communication based on mobile network infrastructure. The NB-IoT and LTE-M standards are included in 3GPP Release 13. Berg Insight believes that the initiative will become successful in establishing a global standard for lightweight IoT communication on public networks in the next 2–4 years. NB-IOT has good prospects of becoming the dominant technology for LPWA, although other standards will most likely also remain strong in niche segments.

 

Q. How will fleet management systems evolve over the next five years?

Fleet management represents an early application area of M2M/IoT technology. The fleet management market for commercial vehicles has developed significantly over the past decades, impacted by general trends such as the transition to SaaS-based business models and the increasing integration of mobile devices as part of the infrastructure which goes hand in hand with a general commoditization of hardware.

Berg Insight estimates that over 30 million commercial vehicles worldwide are equipped with active fleet management systems based on satellite positioning and mobile communications. This corresponds to a penetration rate of 10 percent. Growing at a compound annual growth rate of 19 percent, the global fleet management market is forecasted to exceed 70 million active vehicle systems by 2020. The largest fleet management markets are currently North America. Middle East & Africa and Asia-Pacific are expected to experience the strongest growth rates in the upcoming years.

Conclusion

As we can see from Johan’s answers, the wireless M2M/IoT technology landscape is advancing at an unprecedented rate, spurred on by competition between new market players and established companies, in addition to new initiatives from the 3GPP. As fleet management is an early application of M2M/IoT technology, such systems have developed quickly over the past few years and are fast becoming the norm for the transport and logistics industries.

Remember to check back tomorrow for part 2, which covers the mHealth market and the near future for autonomous cars.

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