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Section 2: Business Case for M2M

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Examine how module price curves arebenefiting the M2M market

List various user types in the e-Health vertical

Describe the number of players that have anopportunity in e-Health

Illustrate how the dynamics have changed inM2M

List ten things you should know about M2M for2011 and beyond

Section Objectives

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3 Optimizing M2M Services on CDMA2000 Networks October 11, 2011 www.cdg.org

M2M Business BenefitsM2M solutions deliver many compelling benefits

Measures that drive investments in M2M vary greatly across

different industries and applications

Source: Harbor Research, Inc., September 2010

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4 Optimizing M2M Services on CDMA2000 Networks October 11, 2011 www.cdg.org

M2M Module Price ComparisonCDMA2000 1X modules are becoming more price competitive

The market for CDMA2000 modules has been characterized

by falling prices over the past few years

Source: Harbor Research, Inc., September 2010

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6 Optimizing M2M Services on CDMA2000 Networks October 11, 2011 www.cdg.org

WAN Dominates the Wireless Connection Space

Mobile networks are expectedto host roughly 86 millionconnections

Fixed installations are usually shortrange to a home hub

Greater demand for mobility, fasterdata speeds and remote monitoring

M2M wide area connections by technology

2010 to 2020

Source: Machina Research

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MNOs to Realize Revenues in the Billions

M2M mobile traffic revenues by service type2010 to 2020

Source: Machina Research

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e-Health is a Good Opportunity for Many Players

M2M mobile traffic revenues by M2M player2010 to 2020

Source: Machina Research

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New Dynamics for M2M (1 of 3)

Mobile Telephony M2M

User Individuals Machines

Key success factor Price, coverage Transparency

Usage Mobile Often fixedTraffic volumes Significant Typically low

Timeliness Time critical Often non time-critical

Reliability Best efforts Often mission critical

Sale B2C, B2B B2B2C, B2B, B2C

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New Dynamics for M2M (2 of 3)

Mobile Telephony M2M

Payment Pre-pay, post-pay subscriptions Multiple approaches

Connection

volumesSignificant

Expected to be enormous

Estimated at 50 billion by 2015

Activation At point of saleMultiple possibilities, depending on

payment approach

Activity period

Typically 30/ 60/ 90 days forpre-pay

During contract period forpost-pay

Device connectivity may not beused for 1 to 2 years

Device may need to be remotelyactivated

Complaints Users complain if there are problems Problems must be detected remotely

Device

management

Users manage devices, potentiallyincluding rebooting

Devices must often be controlled, andproblems diagnosed, remotely

ARPU $20 to 28 Low, often $0.75

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New Dynamics for M2M (3 of 3)

Mobile Telephony M2M

Switching providersUser either purchases anew handset, or unlocks

phone

Potentially involves a moduleswap or remote provisioning

Network usageSome badly written

applications areinefficient

Potential for very high signallingvolumes

Network technologiesUsers upgrade devicesin step with network

technologies

Network switch off could be anissue within the expectedlifetime of certain devices

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Top 10 things you need to know about M2M for2011 and beyond (1-5)

1. The total opportunity will be huge

2. Addressing the opportunity requires tailored solutions

3. Impossible for one company to serve all verticals:partnerships will abound

4. Traffic: M2M (generally) does not need new, highcapacity networks

5. QoS guarantees may be pre-requisite for someindustrial applications

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