The Machine-to-Machine (M2M) market is promising significant business opportunities for mobile service providers in Mexico. With the projection of over 10.5 million Lines in Service (LIS) by 2022, the market (M2M) is expected to grow at around 22% CAGR.
Despite being at nascent stage of its product lifecycle, the M2M market demand in the country is triggered by both types of end users—consumers and enterprises.
The smartphones, connected vehicles, wearables, etc. fall under consumer vertical. Whereas, transportation and automotive, industry, energy and utilities and finance institutions are prime enterprise verticals those are likely to propel the market of M2M communications rapidly in near future.
Transportation and Automotive: The M2M solutions are widely used for various purposes such as to track the position of vehicle, traffic navigation, fleet management, etc. In Mexico, the demand for fleet tracking and monitoring solutions generated 54% revenue for mobile service providers last year.
Although the demand for M2M solutions in transportation and logistics space is high at present, it is expected to lose its market grip in the coming years. This is because most of the OEMs are partnering with telematics solutions providers. It is estimated that this vertical will be generating almost 39% revenue by 2022 which will still be higher than any other verticals.
Industrial: The government of Mexico’s digitization policies in creating digital ecosystem for the adoption of industry 4.0 model is creating demand for M2M solutions in this vertical. It is (industry vertical) expected to generate almost 26% revenue by the end of 2022.
Energy and Utilities: With the increasing adoption of smart metering, the M2M market will witness rapid growth in this segment in Mexico. The country’s target to generate over 26 GW electricity in near future will tremendously inflate the demand for the installation of smart metering. Moreover, the Mexican government’s initiative to create smart cities will further escalate the demand for M2M solutions in the country. This vertical is estimated to reap 14% revenue in next five years, up from 8% at present.
Banking and Finance: This vertical will be driven by Point of Sale (PoS). Besides, M2M solutions in restocking, ATM machine management and managed security are expected to make impact in this vertical. The vertical is expected to generate over 12% revenue for M2M solutions.
The market for M2M in Mexico is expected to grow by more than triple by 2022. But, telco service providers in the country have to establish themselves as hubs for innovation and communicate verticals regarding new development in M2M solutions and associated benefits.
Subarna Poudel is a researcher with Frost & Sullivan. He can be reached at firstname.lastname@example.org
Sapan Agarwal drives content and marketing for Frost & Sullivan. Sapan is based out of Kuala Lumpur Malaysia and can be reached at email@example.com | +603 6204 5830