Information Exchange is the simplest form of marketplace. It is like a yellow pages directory for M2M, facilitating the information exchange and charging a listing fee for registration. Although the payoffs are lower in this model, since there are no development, integration, billing or distribution costs involved, the risks for CSPs are lower as well.
In the Transaction Exchange, the CSP bundles the solution with its own connectivity and facilitates billing and distribution. The online portal displays the solutions, facilitates solution discovery, billing and the CSP can charge a sales commission for each transaction. Quality standards for the listings, distribution SLAs and standard purchase and returns policies are enforced by the marketplace.
In the Full-Service Exchange, CSPs, in association with other industry players, aggregate the devices, software, and applications and also participate in solution development, deployment and support. The online M2M marketplace assumes a brand identity of its own, providing end-to-end solutions including consulting, devices, software, system integration and support and maintenance services. Here, the CSP owns the solutions and earn profits based on sales. The operations are more complex and the focus is on creating an ecosystem, with quality assurance, solution innovation and value protection.
An online M2M marketplace is a cost-effective concept with minimal upfront investments. It can provide CSPs with a real-world view of M2M market demand along with additional solution up-sell and cross-sell opportunities.