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For the second year running, Vodafone has been crowned the communications service provider (CSP) best placed to take advantage of the global M2M opportunity in Machina Research’s annual M2M CSP Benchmarking Study.

Vodafone tops an established first tier of M2M service providers that also includes AT&T, Deutsche Telekom, and Telefonica

Commenting on the result, the study’s author Matt Hatton said “Vodafone has been very active this year with lots of exciting new M2M developments and thoroughly deserves to retain top spot. The company has focused on adding value through a diverse set of product offerings and pursuing new approaches to reduce the cost and complexity of M2M offers. Furthermore, structurally Vodafone is now better placed to address M2M courtesy of its C&W Worldwide acquisition and an elevated position for M2M within the new Vodafone Enterprise Division.”

The study compared major M2M CSPs in six key areas that will determine their future success: Pedigree, Platform, Place, Partnerships, Process and People. Based on ratings across each of these six ‘P’s, Machina Research has identified a clear top tier of four CSPs that are establishing themselves as global leaders: AT&T, Deutsche Telekom, Telefonica and Vodafone.

Hatton commented: “While Vodafone has taken top spot it is closely pursued by three CSPs that have all had a good year in M2M in one way or another, particularly in initiatives that allow for better support of global client demands. We believe Deutsche Telekom has resolved its strategic approach to the US market, which was the key question-mark in 2012 and has also done much work to build a global alliance in the form of the Global M2M Association (GMA). AT&T has also strengthened its global credentials through its network of operator relationships, as has Telefonica through its leadership of the (still officially un-named) global alliance of operators. These globalization moves are far from the only reason why we scored these three CSPs highly, but they are significant”.

As well as the emergence of a top tier of four global operators, the other notable trend is that other CSPs will need to adopt an appropriate strategy to compete with these players’ scale. In the study, this is characterized as: go vertical, go local or go home.

Hatton elaborates: “There is only room for a handful of broad-based global M2M CSPs. CSPs that cannot achieve scale will best address M2M by providing either highly specialised expertise in particular areas (e.g. Orange in the healthcare sector), or by focusing on their local territories where they have specific differentiators, such as enterprise sales force or field force, and/or can provide a high degree of customization of solutions. In many cases these, rather than the global CSPs, will be the best choice for a procurer of M2M services, so all is not lost for those outside the top tier.”

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