Machine-to-machine (M2M) communication is ushering in quite a transformation in the way various businesses work, aided by cloud computing and Big Data analytics. Recent research shows that M2M connections will grow to 2.1 billion in 2012, up from about 100 million in 2011. Research firm MarketsandMarkets expects the global M2M market to reach about $86 billion by 2017, aided by cloud computing and smartphones.
Businesses are finding innovative ways to use M2M technology, opening up new opportunities and finding new ways to create value. For instance, auto insurers are using M2M devices to track driving habits of customers, the number of miles driven, braking patterns, etc. The devices send this information over cellular networks to the insurance providers. By using Big Data analytics to mine this data real-time, insurers can set premiums based on driving habits and other factors. Cautious drivers can save up to 30 percent on insurance premiums by using these devices.
Oil and gas companies are using M2M communications to operate their numerous wells in remote locations without having to send workers across to check on them every day. These devices can, for instance, keep track of oil and water levels in the tanks supplying each well and replenish them when needed. M2M will also be a key enabler for the smart energy grids seen as a critical component for achieving energy sustainability. These devices transmit information on energy usage from consumers' homes and electric vehicles to utility and power generation companies, enabling optimum utilization of energy.
Healthcare is another segment where M2M technology is making fast inroads. It is now possible for a network of machines such as blood pressure monitors, glucose meters and electronic scales, with integrated sensors, to monitor a patient continuously and alert a physician in case of emergency. Such smart networks can reduce not only the cost of monitoring patients, but also the time to access medical aid.
Consumer companies have also leveraged M2M technology to set up smart vending machines that tap usage data and weather forecasts to determine replenishment schedules.
Machine-to-machine communication is no longer just about a machine conversing with a hub or another machine. It has expanded and transformed into a system where each machine shares data with other machines, which then act based on the data. The devices are getting smarter, more versatile and pack more punch through the use of Big Data analytics and cloud computing technologies. In a future of total connectivity and the Internet of Things, the voice of the machines will only get louder.
While there is no definitive emerging market retailing model, a deep understanding of the defining characteristics of the local markets and a willingness to adapt the business model to new ground realities will go a long way in ensuring business success and growth of the retailer entering these markets.