M2M - The Industry

At Novotech, we like to call ourselves "an M2M company", since it is really all that we do (and really, all that we know, so it works out well!)  Someone asked me the other day about the new garage door opener that they bought.....one that connects via WiFi to their home router and has an iPhone app to allow you to close it.  They asked, "Are they in your space?"  After thinking about it for a while, I said "Yes, I guess a garage door manufacturer is an M2M company as well."

So...what exactly is an M2M company now?  We like to think of the traditional players (distributors like Novotech, cellular carriers, M2M Hardware manufacturers, M2M software companies, etc) as M2M companies.....and, they are.  But what about a company that allows you to turn on your sprinklers at home, a company like Nest that improves your home comfort and safety and what about the aforementioned garage door manufacturers who reminds you that your garage door is open via text?  Are they any less of an M2M company than we are?

So, this redefinition to our preconceived notions of what an M2M company is changes things in a few ways...

It means that we have more competitors....and customers.

The garage door company is now offering a solution that can possibly compete with some existing M2M solutions that provided traditional SCADA applications, at least for their specific product.  So, if that was your marketplace, you would perceive a company that provides a solution that works with their own products to be a competitor, and that only make sense.  However, in our case (as well as many other companies), we would see them as potential customers.



 The garage door solution would require a few moving parts to make it work.  While a garage door manufacturer would no doubt have a good understanding of RF technology (since most garage doors use some sort of radio technology to communicate with the remote), they would have some idea of how to incorporate WiFi.  However, the world of IP may not be something they are used to, so there may be both some extra hardware sales as well as consulting opportunities there. 

The idea of the cloud based application (needed to work with the iPhone/Android app) as well as the actual application for the smartphone would be totally new, I would suspect.  So, there would be a lot of opportunity for web and application developers.

It may minimize the role of the carriers to a dumb pipe....or worse.


Right now, cellular carriers are seeing a lot of opportunity in the M2M space.  Most have significant offerings for many aspects of the connection (airtime, IP addressing, security services) and some are getting heavily into making money on hardware and services.  However, as companies begin to offer solutions through their own channels, it can minimize their role in the M2M ecosystem for many applications.

In this garage door scenario, the carriers have been shut out for the most part.  Their only play would be to provide connectivity for the smartphone to remotely shut the garage door, and if the activity was done via a Wifi connection, they may not even get that.

For many applications, Wifi is not used and both parts of the connection are done via the cellular network.  So, this would definitely increase the amount of activity on the carrier's network.  However, increasingly, large companies are bundling in the cellular airtime into their overall solution.  While it still does increase the amount of bandwidth that the carrier is selling, it can reduce some of the "key differentiators" that the carriers have, meaning that the vendor will only look to the lowest price from the carrier bidders.  This reduces margins and the abilities for the carriers to upsell other more profitable services.

Consulting and outsourcing may become more prevalent


My guess....I doubt the garage door company did the work to enable this application internally, all by themselves.  They would have at least brought in some outside help to get things going (ranging from engineering to design to certification), and increasingly, they may have just "farmed" it out completely to a 3rd party agency.

This is becoming much more commonplace in the market, and it makes sense.  My advice to companies is always to stick with what you know and wherever possible, bring in someone to do what you are not good at.  Many companies are moving email out to the cloud, as an example, just because they have better things for their high-priced talent to do. 

Bottom Line

As more and more companies make the move to becoming an M2M company, it really does help the overall industry.  However, it does not come without a price for some companies.  Many companies will see new competitors and this can be scary.....but, the smart companies will adjust their models to this new reality and they will thrive.  Are you ready for this change?

As always, Novotech is ready to assist with your M2M needs. Whether you’re looking to control, track, monitor or back-up, Novotech has the solutions and products you need. View our Line Cards and let us know how we can be of assistance.

Stay connected! Follow Novotech on Twitter (@NovotechM2M) or follow me personally (@LBNovotechM2M).  We’re also very active on LinkedIn so follow our company page too.