The global market for M2M modules is set to double in value between now and 2018, to around $2.9 billion, according to new data from Infonetics Research.
“The services built upon mobile M2M modules, such as fleet management and connected car, are already a sizeable business and are growing much faster than traditional business lines,” said Godfrey Chua, the directing analyst for M2M and the Internet of Things at Infonetics.
“We look for the market to accelerate beginning in 2015, as M2M services inflect and module sales shift toward higher-ARPU [average revenue per user] 3G and 4G systems, ultimately just about doubling to $2.9 billion in 2018,” he said.
Module sales generated total revenue of $1.4 billion in 2013, 6% more than in 2012, notes Infonetics.
Although 2G modules comprised the majority of units shipped in 2013, the shift towards broadband technologies is expected to spur the take-up of 3G and 4G equipment over the next few years.
According to the market-research company, 3G will account for 67% of mobile M2M module revenues by 2018.
Meanwhile, LTE remains the most dynamic and fastest-growing technology segment – Infonetics expects revenues from the sale of LTE modules to increase at a compound annual growth rate of 144% over the forecast period.
And while North America and Europe are the key centers of mobile M2M module growth, the Asia Pacific is quickly catching up – buoyed by investments that are being made in China, Japan, South Korea and Singapore – and is expected to account for a third of total revenue by 2018.
The companies that dominate the M2M module space continue to be Sierra Wireless (Richmond, Canada), Gemalto (Amsterdam, Netherlands) and Telit (London, UK) – which together account for nearly two thirds of total market revenue – but Chinese vendors Huawei (Shenzhen, China) and ZTE (Shenzhen, China) are growing in stature and creating what Infonetics describes as “intense pricing pressure” in emerging markets.