Cellular Machine-To-Machine Module Vendors Face A Difficult Market

June 13, 2007
SCOTTSDALE, AZ—Manufacturers of the cellular modules at the heart of machine-to-machine (M2M) communications are currently facing an extremely difficult market characterized by increasing commoditization and shrinking gross margins. A study of this ...

SCOTTSDALE, AZManufacturers of the cellular modules at the heart of machine-to-machine (M2M) communications are currently facing an extremely difficult market characterized by increasing commoditization and shrinking gross margins.

A study of this market from ABI Research reports that nearly 18 million cellular modules shipped into M2M applications in 2006, including telematics, telemetry, and wireless local loop (WLL), and suggests that this number should grow to roughly 90 million in 2012. Telematics shipments are expected to increase at moderate double-digit growth rates, while both telemetry and WLL shipments should see strong growth in excess of 30-percent CAR.

According to ABI principal analyst Sam Lucero, "Vendors face a variety of fixed and variable costs to operate, and even with unit growth at 30 percent, they can be squeezed if they can't derive sufficient revenue to cover these costs."

Vendors are responding to these conditions with a variety of strategies designed to preserve or recover their financial viability.

Lucero says, "Some M2M module vendors are tying to increase their share of the silicon content in the application, integrating more powerful processors and hoping to host more of the end application's total value. Because there are certain M2M applications that benefit from high-speed connectivity—video surveillance, digital signage, and and fixed wireless terminals, for example—others have taken the tack of including 3G technologies in the mix. These companies have existing businesses in 3G PC cards and laptop PC cellular broadband connectivity, so they're using those as a launching pad into the M2M space."

Sponsored Recommendations

Request a free Micro 3D Printed sample part

April 11, 2024
The best way to understand the part quality we can achieve is by seeing it first-hand. Request a free 3D printed high-precision sample part.

Request a quote: Micro 3D Printed Part or microArch micro-precision 3D printers

April 11, 2024
See the results for yourself! We'll print a benchmark part so that you can assess our quality. Just send us your file and we'll get to work.

Designing Wireless Modular Robots Using Advanced 3D Printing Precision

March 28, 2024
Learn how researchers at Southern Methodist University used 3D printing to fabricate wireless modular robots.

Microelectromechanical 3D Printing Resources

March 28, 2024
Check out our curated list of microelectromechanical 3D printing resources and see how PµSL technology offers freedom and speed.