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Trend-spotting: Smartphones vs. Specialty M2M Devices for Go-to-Market M2M Solutions

Posted by Norman Miglietta on 05/11/2011

Last week I had the pleasure of attending and exhibiting at the 2011 American Telehealth Association annual meeting in Tampa, Florida. There were hundreds of companies showcasing their healthcare technology, from mobile patient care to robots that perform intricate surgical procedures. The advancements in medical science ranged from the mundane to the breathtaking.

But for me, a very interesting and surprising trend surfaced as I interacted with a number of entrepreneurs and technology companies about their M2M healthcare solutions and the cellular and satellite network services we offer at KORE: the emergence of off-the-shelf smartphones in lieu of specialty M2M devices.

At first I was taken aback, but then it dawned on me – this approach has many benefits.

First, most smartphones out of the box are necessarily network operator certified. No more waiting around to deploy or paying expensive and sometimes time consuming test lab fees. Just open the phone, turn off its voice capabilities, load the software needed for the application and you are ready to ship it to the next paying customer. Speed to market is key – and the smartphone instantly removes several limiting variables from the solution provider's go-to-market equation.

Secondly, these devices have come way down in price, thus becoming more attractive as a substitute for a pure-play M2M device. A specialty M2M device may be somewhat cheaper still, but the economics are much closer to parity than ever before. And finally, you have the processing power of the operating system on the device itself, making it a powerful ally for the solution provider selling it. Data processing happens right there on the device rather than in the cloud, thus shaving off latency and increasing the application's efficiency.

So, when you really think about it, this approach is quite simple and cost effective, especially for newly formed start-up companies. Certain limitations do exist, but in general using smartphones for M2M apps decreases time to market, virtually eliminates certification risk, end users are familiar with the form factor and the device can assist in the task of processing data on the front-end to reduce the amount of network data sent. Providers will need to take precautions to ensure that users cannot run up thousand dollar phone bills calling friends and family around the world; but once they do this is a pretty clean go-to-market strategy.

Will it work for everybody? Certainly not. But for an entrepreneur looking to establish a revenue model to solidify funding, for example, this strikes me as the fastest, safest and cheapest method to get underway.

I did a little more digging and found that the trend isn't unique to the healthcare industry. In a recent article in Fleet Owner magazine, titled, "Smart Phones, Small Fleets" Wendy Leavitt points out that trucking fleet owners are using smartphones more and more because they already have GPS and other smart capabilities on board, so they can be used in conjunction with, or even as a replacement for, in-vehicle fleet telematics solutions. In some instances, the phones provide even more value because features like a built-in camera can be used to provide bona fide proof of delivery.

The difference to a pure play M2M network solutions provider like KORE is irrelevant. We can support cellular data services for our customers using any device, as long as KORE is providing the SIM card and the device is certified by the PTCRB (GSM) or CDG (CDMA) and our network carrier partner.

I don't expect the quantity of M2M specialty devices to be overshadowed by this expedited strategy of using smartphones, but I do anticipate this trend will continue to gain popularity because it provides a fast and efficient path to market for some application service providers. And the hard cost for smartphones will only continue to decline.

By Stein Soelberg, Director of Marketing
Stein leads a team whose responsibility is to own the branding, advertising, customer engagement, loyalty, partnership and public relations initiatives designed to propel KORE into the 21st century. With over 15 years of technology marketing experience in the business to business software, Internet services and telecommunications industries, Stein brings a proven track record of launching successful MVNOs and building those brands into leaders.