While US and European machine-to-machine (M2M) technology developers are still banging their collective heads on the wall trying to work out what the Internet of Things (IoT) will be like, who will be developing it and where it will emerge, China is busy forging ahead.
According to new research released by Europe-based GSMA last night, not only is China outstripping both the US and Europe — but it is doing so with the active and concerted support of its local and national government bodies.
The GSM Association (GSMA)(Groupe Speciale Mobile Association) is an association of mobile operators and related companies devoted to supporting the standardization, deployment and promotion of the GSM mobile telephone system.
The findings of the research is pretty impressive, and should give M2M developers outside of China considerable food for thought. According to the report, titled How China is Set for Global M2M Leadership, Asia now has 27 percent of total global M2M connections, with over 50 million connections. That's more than one quarter of the total M2M market in 2013.
In fact, Asia is currently the largest regional M2M market. The global breakdown goes as follows:
- Asia, with 40 percent of global M2M connections
- Europe, 29 percent
- America,19 percent
- Latin America, 7 percent
- Africa, 4 percent
- Oceania, 1 percent
This means that between 2010 and 2013, Asia added 55 million M2M net connections. This is compared with 29 million in Europe and 15 million in North America. China, the research found, is the primary driver of the growth in Asia, adding almost 39 million M2M connections during the period.
The research also noted that China's massive growth was made possible by close collaboration between the country’s leading mobile operators -- China Mobile, China Unicom and China Telecom -- and state owned enterprises.
M2M versus the IoT
Though M2M technology is not quite the IoT, it is as close as you can possibly get to it at the moment. Last year, Sanjay Poonen, head of the mobile division at SAP, explained the difference between the two:
… M2M technology is primarily being used to collect vast amounts of machine and people based data. The "Internet of Things" concept goes one step further by not only integrating machines, people, ERP and CRM systems and other information sources like social media, but also analyzing and making use of all the data. Soon, people will interact with devices that in turn interact with data to deliver personalized products and services directly to the consumer in real time…”
The ultimate outcome of all this, the research says, is to allow people to interact with data and enable enterprises to deliver personalized products and services directly to the consumer in real time.
China Takes The Lead
We have spoken a lot about the difficulty pundits have been having trying to figure out what the IoT will look like. Anne Bouverot, director general and member of the board, explains why no such problem exists in China:
Demand from the energy and transportation industries has driven much of this early growth, while M2M solutions are also gaining traction in the automotive, smart city, healthcare, education and retail sectors.
Much more than connectivity, China’s leading mobile operators…are developing sophisticated M2M service propositions that go far beyond the provision of basic connectivity. In many cases, they are providing end to end solutions, supported by systems integration and dedicated charging policies."
She also points out that all three mobile operators stress the need to work with partners to create technological and commercial platforms that nurture the development of the M2M ecosystem.
Even a brief read of the report will show that none of these operators appear to have the existential angst about the nature of IoT that appears to be hindering its development outside of China, with Bouverot noting the deployment of a "generic horizontal platform" across all economic sectors which is later augmented for specific application areas.
China Mobile has even gone so for as to set up a dedicated unit -- the China Mobile Internet of Things Co Ltd -- to develop the IoT, which in turn is supported by a centralized dedicated M2M network, a unified operations platform, a dedicated number segment, communication channels and charging strategy. On top of this, it has also developed standardized chip sets and modules as well as name brand devices for the IoT.
The China experience has also helped to indicate, to some extent, how the IoT is emerging and what kinds of industries it is developing in. Needless to say, with the support it's getting from local governments, the kind of verticals that are developing and using the technologies is hardly surprising.
According to the GSMA research, the energy sector was the very first industry to see the potential of M2M and the IoT on a large scale. Already, utility companies, which are largely state owned, are using smart meters to give real time information on energy consumption.
The research cites Alex Chau, principal analyst, head of Asia at Machine Research, who says that 180 million meters have been installed already, with another 60 million meters currently being deployed. While most of the existing meters are working off fixed lines, Chau expects mobiles to play a major role in the future as the energy grids expand beyond the cities.
Like its energy sector, China's transport industry and infrastructure is massive. According to GSMA, China is currently using M2M technology to improve efficiencies. Examples of this include haulage companies that are making increasing use of M2M technology to track transport movements.
China public transport, including rail and urban transport services, are also making significant use of M2M, including video cameras to monitor traffic movements and safety. Citing Haihua Li of the China Academy of Telecommunications at the Ministry of Industry and Information Technology, GSMA says that 26 different provinces in China have deployed electronic toll collection systems covering 4,600 lanes used by 5.1 million drivers.
3. Smart Cities
This is one that US and European audiences will be familiar with, particularly those that have been following IBM’s developments in this space. However, while IBM has made a clear distinction between Smart Cites and IoT, in China no such distinction appears to exist.
All three state mobile operators have smart city programs in place, with 219 cities signing up for smart city initiatives as recently as February 2013. Already, apart from traffic management, China’s cities are also using mobile connectivity to remotely control streetlights and sewer covers, to track noise levels on construction sites and in residential areas and to support evacuations in the event of an emergency.
M2M has also been embedded into the health sector, enabling patients to be monitored remotely, while schools in rural areas are being connected to the cloud.
China still has work to do to develop its IoT, but it appears to be a lot further along than the US or Europe. But with federal and local government backing and encouraging China's recent surge in M2M activity, is that really a surprise? Indeed, China's success may well be a road map for improved development globally.