Where M2M And Big Data Are Headed

Machine-to-machine (M2M) devices, working in conjunction with big data analytics platforms, wireless Internet, and cloud computing, will fundamentally transform business in the 21st Century. Companies that fail to implement these technologies are at risk of becoming also-rans in their respective fields, according to a new report on M2M technology by research firm Mind Commerce.

The study, M2M Technology Drivers, Market Dynamics, and Industry Verticals, examines how M2M devices, including sensors for the automotive, education, healthcare, and public utility sectors, will drive growth across multiple industries.

"Machine-to-machine is beyond what people think of just monitoring a Coca-Cola machine to see if it's full or not. The impacts are significant and will be far-reaching throughout almost all industries," said M2M Advisors analyst and report author Dennis Lottero in a phone interview with InformationWeek.

[ Gathering big data is one thing; putting it to practical use is another. Read more at How To Bridge Big Data's Information Gap. ]

According to research firm Analysys Mason, M2M connections will grow to 2.1 billion by 2021, up from roughly 100 million in 2011. Businesses must find ways to ingest, share, and analyze massive amounts of data generated by these M2M devices.

"How do you store data correctly so that it can be analyzed with algorithms? And what analytical tools are you going to have available to overlay on those large data sets?" Lottero asked.

Industrial and consumer sectors are finding innovative uses for machine-to-machine devices in places you might not expect. Automotive insurers, for instance, are starting to offer drivers the option of installing an M2M device that monitors their driving habits.

Progressive Insurance is one such company. Its Snapshot module is an M2M device that's roughly the "size of a Zippo lighter," said Lottero. The module plugs into a car's OBD-II diagnostic connector and tracks driving habits over a 30-day period, including the number of miles driven, how hard the driver brakes, and how often he or she drives between midnight and 4 a.m.

Snapshot uses a cellular connection to send this information to Progressive, which provides daily updates of a participant's driving habits on its website. It also projects insurance premium savings based on the driver's actions. At the end of the trial period, cautious drivers can save up 30% on their insurance premiums, Progressive claims.

Intrusive M2M devices that study your every move raise privacy concerns, of course, but the opt-in nature of monitoring programs such as Snapshot may thwart some potential criticism. "In the automobile insurance, it's voluntary. If you want to take advantage of the discounts, you plug [Snapshot] in. If not, you go by the standard rate," said Lottero.

The future may also bring mandatory implementation of M2M monitoring devices, however. For instance, an auto insurer could require its customers to use a Snapshot-like device in order to receive coverage. "I'm sure they would like to go that route," Lottero said.

The technology's analytical skills are improving, and it's getting cheaper to use. About three years ago, M2M driving monitors cost close to $500 each, provided far less analysis, and had to be set up by a professional installer. "Now the insurance company mails them out to the average consumer, who just plugs it into their vehicle. And the price point is starting to get down to just about a hundred dollars now," said Lottero.

Healthcare is another area where M2M has the potential to transform an industry. Machine-to-machine devices, including blood pressure monitors, glucose meters, and electronic weight scales, have integrated sensors that check patients' conditions in the home, thereby saving a trip to the doctor's office or hospital.

An M2M monitor can also alert a physician when it detects a potential health problem. "Rather than waiting for a person to end up in the emergency room or hospital, which gets very expensive, the physician can be notified when the patient is in a negative state, and proactively schedule a visit," said Lottero.

Find out the nine questions you must ask before migrating apps to the public cloud in the Cloud Ready? special issue of InformationWeek. Also in this issue: It's time to lay to rest two common myths of the cloud computing era. (Free registration required.)