The global machine to machine [M2M] market size is estimated to be nearly $950 billion by the year 2017. This market has been seeing some impressive growth over the last 36 months thanks to the inclusion of cloud technology with mobile computing options. Other factors that will continue to expand growth is the expected inclusion of RFID technology on more credit cards, power module growth, and continued strength in the smartphone industry.
By the year 2020, the M2M market size with grow by nearly 8x. With an impressive 23% annual growth rate, it is clear to see that the this market is on the brink of achieving something that is incredibly profound.
Who Is Leading the M2M Market?
The United States continues to dominate the M2M market and is expected to do so through 2020. The US accounts for 21% of the current M2M market revenues that are achieved annually. China comes in second with 16% of the market share. Japan comes in a distant third with just 8% of the total market. This shows that the combination of wealth and population size in the US is continuing to lead the charge, but that could change after 2020.
The Chinese middle class is continuing to grow and expand. Japan’s market is starting to increase its size, slowly but surely. India’s middle class is also finding more disposable income at its disposal and may have a dramatic impact on the M2M market size in the future.
Why is there so much strength in this market? Ericsson, one of the manufacturers that is benefiting from this explosive growth, has predicted that the number of connected devices in the world will reach 50 billion by the year 2020. This is based on the fact that there are over 3 billion subscribers to 24 hour information products right now that have a minimum of 5 connected devices each.
Where Is the Biggest Growth Being Seen?
The healthcare industry industry is expected to see the biggest per capita growth within the M2M market size in the coming decade. In 2010, this industry had just 1% of the total M2M connections. By 2020, it is estimated that they will have 6% of the total connections. The largest overall growth, however, will be seen in the smart buildings sector. By 2020, 27% of the market will be connections from smart buildings, up from 12% in 2010.
Languishing behind in growth is the automotive industry. In 2010, it accounted for 8% of the M2M market size in connections. By 2020, it is estimated that it will account for 11%. Depending on how driverless vehicles and other technology advances fare in the legal arena, however, this estimation may increase.
In terms of total connections overall, the estimates show that every major region except one will see declines in their level of the M2M market share. The US is expected to see the largest drop, going from a 27% share to a 22% share of connections. On the other hand, in the emerging APAC region, the number of connections is expected to increase from 13% to 27%.
What Is Driving Data Volume In the M2M Market?
By 2020, there is expected to be a 40x increase in the amount of traffic volume that originates from telematics, healthcare, and CCTV feeds. This traffic alone is driving 100% annual growth in the industry. In terms of data, in 2010 these three components accounted for 7.4 petabytes of data. 1 petabyte equals 1,000 terabytes. By 2020, these three components alone are estimated to account for 296 petabytes of data.
The profits that can be realized are immense. Ideal Life reports that for every $1 they have invested into the M2M market size, they have seen a return of $7.57.
To make the estimations become a reality, the M2M market has some work to do. Technologies will need to become standardized so that machines will be able to more effectively connect and talk with each other. Consumers will also need to see the benefits of the M2M market and want to participate within it. Consolidation will also need to occur because there are several competing ideas in the market place that are dividing the market right now.
The M2M market size shows an incredible potential for continued amazing growth. With services alone achieving revenues of over $50 billion in 2014 and technological innovations coming at a rapid pace, Ericsson’s bold prediction of 50 billion connected devices may actually fall far short of what the actual number may be.
Last month, more than 2 million people visited Brandon's blog. He shares exactly how he took his blog from zero to 1 million monthly visitors here. His path to success was not easy. Brandon had to comeback from being disabled, by a rare health disorder, for most of his thirties. God delivered him from hardship and has blessed his family in so many wonderful ways. You can send Brandon a message here.