Cellular M2M retail connections to hit 33.3 million in 2018: Berg Insight

The number of cellular M2M connections in the retail industry is set to grow from 18.4 million in 2013 to 33.3 million in 2018, according to new research from Berg Insight.

It also reckons that shipments of cellular M2M devices for retail applications will increase at a compound annual growth rate of 6.5% over the forecast period, rising from 6.6 million units in 2013 to 9.1 million in 2018.

POS terminals are expected to constitute the largest device segment, accounting for almost 90% of all cellular M2M connections in the retail industry at the end of 2013.

The number of cellular M2M connections in the retail industry is set to grow from 18.4 million in 2013 to 33.3 million in 2018, according to new research from Berg Insight.

It also reckons that shipments of cellular M2M devices for retail applications will increase at a compound annual growth rate of 6.5% over the forecast period, rising from 6.6 million units in 2013 to 9.1 million in 2018.

POS terminals are expected to constitute the largest device segment, accounting for almost 90% of all cellular M2M connections in the retail industry at the end of 2013.

Nevertheless, Berg Insight says the market for wirelessly connected POS terminals is relatively mature, and that most of the market growth is being driven by the increasing use of electronic payments in emerging markets.

In contrast, the adoption of cellular is at an early stage in the vending machine market – only 7.4% of the six million vending machines in North America are connected, while just 2.9% of the 3.8 million in Europe use cellular connectivity.

“Vending is the largest untapped market for wireless M2M in the retail industry,” said Lars Kurkinen, a senior analyst at Berg Insight.

Kurkinen says the North American market has recently entered a strong growth phase and will have 1.14 million connected vending machines by 2018, while Europe will start to flourish over 2014–15 and have 0.4 million vending machines by 2018.

“Every vending machine will eventually be connected, but costs for the wireless M2M hardware and subscriptions still need to come down significantly before this vision becomes reality,” said Kurkinen.

Berg reckons cellular M2M connectivity will have a transformational effect on vending and parking, where machine operators need to reorganize their operations in order to benefit from the availability of real-time information.