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SA Enterprises Adopt Smart M2M Solutions to Improve Operational Efficiency

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M2M Market Opportunities in South Africa—Vertical Focus is part of the Mobile & Wireless Communications (http://www.wireless.frost.com) Growth Partnership Service program. Frost & Sullivan’s related …

M2M Market Opportunities in South Africa—Vertical Focus is part of the Mobile & Wireless Communications (http://www.wireless.frost.com) Growth Partnership Service program. Frost & Sullivan’s related studies include: U.S Machine-to-Machine (M2M) Communications Market–Tier-I Mobile Operator Profiles and Analysis, Smart Cards in the M2M Communications Market, M2M–The Role of Telecoms Services Providers. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.

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  • 1. SA Enterprises Adopt Smart M2M Solutions to Improve Operational Efficiency Machine-To-Machine Market Opportunities in South Africa - Vertical Focus
  • 2. Source: Frost & Sullivan analysis. Research Preview
  • 3. Contents of Full Research Section Slide Number Executive Summary 7 Research Objectives and Scope 11 Market Definitions 16 Market Overview 20 Drivers and Restraints 25 Forecasts and Trends 37 Automotive Vertical Analysis 42 Retail and Finance Vertical Analysis 53 Utilities Vertical Analysis 61 Telecoms and Platform Providers 73 Strategic Recommendations and Conclusions 80 Appendix 84 The Frost & Sullivan Story 86
  • 4. Research Objectives and Scope
  • 5. Research Aim and Objectives To provide an analysis of selected verticals in the South African M2M market To provide an overview of the key trends in the South African M2M market To quantify the size of selected verticals of the M2M market and provide a forecast for the period 2014–2018 To highlight M2M opportunities in the automotive, retail and finance, and utilities verticals To provide strategic recommendations to providers of SIM cards, access networks, and M2M platform vendors Aim Objectives Source: Frost & Sullivan
  • 6. • Equipping vehicles with SIM cards adds value to manufacturers and drivers. Examples range from in-car entertainment over remote maintenance to monitoring of functionalities to pay-as-you-drive insurance models and tracking of vehicles in case of unauthorised use. • M2M projects in this vertical are related to the point-of-sale terminals, kiosks, vending machines, and ticketing machines. Other applications may include inventory updates across distributed locations or warehouses. • Utilities and municipalities are expanding their focus on SIM-enabled smart meters to manage the consumption of water and electricity. M2M deployments in this vertical are largely driven by the growing need for revenue protection through remote access to water and electricity meters. • Other verticals such as consumer electronics, manufacturing, and healthcare are also expected to experience further growth, but have not been included in this study. Consumer-driven M2M include applications on consumer devices such as eBooks, home appliances, and other digital devices. Research Scope—Verticals M2M Market: M2M Vertical Applications, South Africa, 2013 Source: Frost & Sullivan Automotive Retail and Finance Utilities Other Verticals
  • 7. Drivers and Restraints
  • 8. Drivers 1–2 Years 3–4 Years 5th Year There is growing support of Tier I mobile operators for M2M solutions. H H H Enterprises are moving towards smart solutions to improve operational efficiency. H H M The rising availability of high speed networks has expanded the coverage of M2M applications. H H M There is growing public support for smart solutions and green governance policies. M M M Impact ratings: H = High, M = Medium, L = Low M2M Market: Key Market Drivers, South Africa, 2014–2018 Source: Frost & Sullivan Key Market Drivers
  • 9. Key Market Restraints Restraints 1–2 Years 3–4 Years 5th Year A lack of device and module standardisation limits the implementation of M2M. H M M Security and privacy concerns will slow the deployment of M2M solutions. H M M Solutions have been predominantly targeted at niche markets with limited focus on other segments. M M M There is a limited specialised M2M technical workforce. M M L Impact ratings: H = High, M = Medium, L = Low M2M Market: Key Market Restraints, South Africa, 2014–2018 Source: Frost & Sullivan
  • 10. Automotive Vertical Analysis
  • 11. Automotive Vertical—Unit Shipment and Revenue Forecast Automotive Vertical: Unit Shipment and Revenue Forecast, South Africa, 2011–2018 Revenue CAGR = 4.6% Units CAGR = 8.3% Note: All figures are rounded. The base year is 2013. Source: Frost & Sullivan. 0 500 1 000 1 500 2 000 2 500 3 000 3 500 4 000 0 5 10 15 20 25 30 35 2 011 2 012 2 013 2 014 2 015 2 016 2 017 2 018 Revenue ($ M) 18.9 21.4 24.5 26.0 26.8 28.3 29.7 30.7 Units (000) 1 950 2 203 2 508 2 689 2 879 3 124 3 409 3 729 Units(000) Revenue($million) Year
  • 12. Automotive Vertical—M2M Application Potential Application Commercial Vehicles Passenger Vehicles Emerging Trends Growth Potential 1–3 Years 4–5 Years Fleet Management Real-time video monitoring an emerging component of the solution Medium High Navigation Applications to include real-time traffic and weather updates and road hazard alerts High Medium eToll M2M demand will be driven by fleet and car rental companies Low Medium Vehicle Tracking Becoming an important part of vehicle insurance offerings High Medium UBI Insurers using it to boost customer loyalty by offering additional savings on premium Medium High Infotainment The connected car to enable in-car Wi-Fi, Internet radio, and multimedia streaming Low Medium Strong UnimportantMediumVery Important Source: Frost & Sullivan Less Important Automotive Vertical: Key Trends, South Africa, 2014-2018
  • 13. Retail and Finance Vertical Analysis
  • 14. 0 200 400 600 800 1 000 1 200 1 400 0 2 4 6 8 10 12 2 011 2 012 2 013 2 014 2 015 2 016 2 017 2 018 Revenue ($ M) 4.5 5.1 5.9 6.6 7.5 8.6 9.8 10.9 Units (000) 460 500 595 702 832 985 1 142 1 231 Units(000) Revenue($Million) Year Note: All figures are rounded. The base year is 2013. Source: Frost & Sullivan Retail and Finance Vertical: Unit Shipment and Revenue Forecast, South Africa, 2011–2018 Revenue CAGR = 13.0% Units CAGR = 15.7%
  • 15. Utilities Vertical Analysis
  • 16. Utilities Vertical—Unit Shipment and Revenue Forecast 0 200 400 600 800 1 000 1 200 1 400 1 600 1 800 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 2011 2012 2013 2014 2015 2016 2017 2018 Revenue ($ M) 2.6 2.9 3.4 4.0 5.1 6.3 7.2 8.2 Units (000s) 312 347 425 538 740 992 1 273 1 532 Units(000) Revenue($Million) Year Note: All figures are rounded. The base year is 2013. Source: Frost & Sullivan Utilities Vertical: Unit Shipment and Revenue Forecast, South Africa, 2011–2018 Revenue CAGR = 19.4% Units CAGR = 29.2%
  • 17. Telecoms and Platform Providers
  • 18. Source: Nokia Siemens Network; Frost & Sullivan Mobile Operators • Mobile operators’ share of the M2M market comes from SIM connections and the consumption of data on connected devices. • Despite owning the communication platform, connectivity revenue (network access and service management) is estimated to account for a 30% share of the overall M2M market, which is expected to fall to 16% by 2020. • With the price of data expected to continue falling, the contribution of data revenue will dwindle further, especially for less bandwidth-intensive applications that require basic connectivity. 2012 2020 $52 billion $214 billion $37 billion 30% 16% $170 billion M2M Applications Data M2M Market: M2M Connectivity, Data, and Application Revenue Breakdown, Global, 2012 and 2020 $44 billion $15 billion
  • 19. Interested in Full Access? Connect With Us Name Samantha James Corporate Communications (+27) 21 680 3574 Samantha.james@frost.com Research Authors First Name Last Name Lehlohonolo Mokenela Research Analyst Information & Communication Technologies http://za.linkedin.com/pub/lehloho nolo-mokenela/41/269/30 Facebook https://www.facebook.com/FrostandSullivan LinkedIn Group https://www.linkedin.com/company/frost-&-sullivan SlideShare http://www.slideshare.net/FrostandSullivan Twitter https://twitter.com/FrostSullivanSA GIL 2014: Africa – Aug 2014 http://ow.ly/zdo6E GIL Community http://visionary-it.gilcommunity.com/
  • 20. Global Perspective 40+ Offices Monitoring for Opportunities and Challenges
  • 21. Industry Convergence Comprehensive Industry Coverage Sparks Innovation Opportunities Automotive & Transportation Aerospace & Defense Measurement & Instrumentation Information & Communication Technologies HealthcareEnvironment & Building Technologies Energy & Power Systems Chemicals, Materials & Food Electronics & Security Industrial Automation & Process Control Automotive Transportation & Logistics Consumer Technologies Minerals & Mining