According to a new research report from Berg Insight, shipments of consumer M2M devices with cellular connectivity reached 5.3 million worldwide in 2012. In the next five years, shipments are forecasted to grow at a compound annual growth rate (CAGR) of 21.1% to reach 13.8 million devices in 2017.
This relatively new breed of connected devices – neither classified as handsets, PCs, tablets nor traditional M2M devices – have strong growth potential. Today, e-readers and PNDs are the most common consumer M2M devices already shipping in millions.
The consumer device market is changing rapidly and dedicated devices are facing fierce competition from multipurpose devices such as smartphones and tablets.
Introducing wireless connectivity is one strategy to meet this threat and new connected products such as the Galaxy camera range from Samsung as well as smaller scale success stories such as the PocketFinder from location based technologies show the market potential for cellular connected consumer devices.
Emerging device categories such as personal tracking, wearable technology and digital cameras are well suited for embedded cellular connectivity and have high growth potential in the coming years.
Berg Insight predicts that by 2017, smart watches will be the most sold consumer M2M device category before personal tracking devices, accounting for 23% and 17% respectively of total annual shipments.
An increasing share of all content and services are delivered through the cloud and cellular connectivity gives the freedom of being connected everywhere.
“There are already over 15 million consumer M2M devices in use worldwide. Business innovation from device vendors, content service providers and telecom operators is now necessary in order to turn M2M consumer devices into a mainstream success,” said Johan Svanberg, senior analyst at Berg Insight.
The 3G connected Kindle e-reader from Amazon is the most sold consumer M2M device to date.
“A seamless integrated offering without any complicated subscription models has been key to the success”, continued Mr Svanberg. Mobile data plans, which let users buy a bucket of data to share across several devices, as well as pay-per-use models are other promising business models for consumer M2M devices.
“It is not always possible to hide the cost of data such as in the case of the Kindle, but the relationship between the benefits and costs need to be both clear and fair in order for users to be willing to pay extra for wireless data,”concluded Svanberg.