Machine-to-Machine (M2M) communications is changing business models and enabling new applications across virtually every vertical industry sector worldwide. Few companies want to be left out of what is expected to be a trillion dollar market driven by the benefits that come with achieving real time awareness and remote control.
Never before has Peter Drucker's famous quote 'what gets measured gets managed' rung so true. Businesses of all sizes and backgrounds are fast deploying M2M solutions to remotely measure data in real time to better manage processes, streamline logistics, predict maintenance requirements and control the performance of machines and systems. Governments are also major adopters of M2M with smart grid and smart meter investments extending to traffic control, garbage collection, transport, water systems and security.
We're headed towards 50 billion connected devices by 2020. That's around 227 new M2M device connections every second. Research company, Frances's IDATE, takes it even further, forecasting 80 billion devices by 2020. The numbers are big, and only getting bigger, with M2M revenues estimated to be around $23 billion in 2016, and continuing to grow at 30% per year.
McKinsey Global Institute expect M2M to create an economic impact of $2.7 to $6.2 trillion annually by 2025. And the World Bank and General Electric are pointing to a $32 trillion opportunity on the premise that a 1% improvement from the integration of Industrial Internet into energy, transportation, healthcare, aviation and other industries can generate savings of around $200 billion.
Topping the list of M2M uses today is energy, IT and transportation. Electricity and water utilities are among the earliest adopters and represent the largest market size and continued growth with the double-digit growth of the last five years expected to reach approximately $26.7 billion by 2017.
McKinsey Global Institute says the health care and manufacturing sectors are set to experience the largest economical impact with IoT across health care applications alone reaching $1.1 trillion to $2.5 trillion per year by 2025. As well taking pressure off hospital emergency resources, remote patient monitoring and management ensures a quicker response to health issues. McKinsey says the treatment costs for chronic diseases constitute approximately 60% of total health care spending, and the annual cost of these diseases in 2025 could reach $15.5 trillion globally. Remote monitoring is expected to reduce this cost by 10 - 20% where applied.
M2M applications in the manufacturing industry are expected to produce productivity gains equivalent to 2.5 - 5%. The total operating cost of global manufacturing, currently about $25 trillion per year, could reach more than $47 trillion by 2025 and considering the high demand for process optimisation in manufacturing, McKinsey expect that 80-100% of all manufacturing could be using M2M applications by 2025. This would lead to a potential economic impact of $900 billion to $2.3 trillion per year by 2025.
M2M has countless uses, and the range of applications to which it can be applied is expanding daily. With the right technology in place, computers can retrieve data from virtually any physical object, allowing businesses and government to monitor and control the progress of people, assets and systems in areas such as utilities, waste handling, mining, construction, forestry, farming and retail.
One of the major challenges to mass adoption is interoperability. Companies that fail to deliver adaptable open protocol wireless technology risk being left behind. NetComm Wireless gives businesses easy access to flexible and scalable technologies that give developers the freedom to create custom M2M applications, giving machines the intelligence to monitor their environment, report their status, automate processes, receive instructions and even take action.