Customers Want End-To-End Solutions
Telcos might be in the perfect place to tie the moving parts together for end-to-end solutions. The leading telcos are working to expand beyond selling SIM cards to capitalize on the M2M opportunity. These providers are getting into end-to-end solutions such as fleet management, according to the IDC report. End-to-end services also generate higher margins.
"With the telecommunications services revenues from core voice and messaging services declining, telcos are on the lookout for new growth opportunities. M2M is certainly one of them," said IDC analyst Ina Malatinska. "Connectivity represents only about 10 [percent] to 15 percent of the total M2M revenue pie. It has become a commodity and we expect connectivity ARPUs [Average Revenue Per User] to continue falling dramatically.”