M2M 101

When a company invests in new technology, it’s usually for a few reasons: to cut costs, increase revenue, and improve customer service. It’s not often that one system can help with all three, but that’s exactly the potential for an emerging technology called M2M (machine-to-machine) communication, which refers to the networking of physical assets so they can be monitored and maintained more effectively. M2M works by connecting communication hardware to a physical asset—anything from a production machine, a semi trailer, a freight pallet, or a finished product—so that information about its status and performance can be sent to a computer system and used to automate a business process or a consumer action. In other words, you take the data straight from a machine itself so a person doesn’t have to do it manually.

The Roots of M2M

Machine-to-machine technology has its roots in the manufacturing industry, where companies have been networking physical assets for decades. Fundamentally, the purpose of M2M is no different than plant-floor automation systems or even remote-monitoring solutions such as SCADA (supervisory control and data acquisition). Just like those legacy applications in manufacturing, M2M involves tapping sensor data inside a machine and transmitting it to an IT (information-technology) network. What separates M2M from these traditional remote-monitoring applications is the flexibility with which the networking is accomplished. Machine-to-machine communication uses existing public networks and access methods such as wireless cellular and Ethernet, which means the total cost of connecting assets or devices is usually conducive to deploying a large number of them. As a result, companies and consumers can start thinking about networking not just their most important production assets, but also just about every other physical asset they own or service for customers. This idea of networking machines to automate business processes has a dramatic effect on the enterprise. First, it can deliver reduced costs by cutting down on maintenance and equipment downtime. Second, it can boost revenue by creating new opportunities for servicing products in the field. Third, it can vastly improve customer service by proactively monitoring equipment, taking action before equipment fails and only when it’s required. While SCADA and remote monitoring have been around for decades, M2M communication using public networks is still a relatively new concept. Early adopters are discovering some very innovative ways to network their assets, and in the process they’re developing a competitive advantage and improving their business models down to their very core.

M2M Emerges

The term M2M emerged early this decade. On Sept. 20, 2002, two technology companies, Nokia and Opto 22, announced a partnership for delivering wireless communication to enterprise assets. They chose M2M as the term to describe the solutions they were developing for networking physical assets using cellular wireless and Ethernet-based communication. The following year, the trade publication M2M magazine was launched, taking Nokia’s vision for a union of “people, devices, and systems” as its tagline. Since that time, M2M magazine has tracked that union and the business value it delivers to adopters in various industries. During the last five years, an industry has evolved to make it easier for companies to network their machines and devices. In that time, the evolutionary process has been two-fold: 1) refine the application systems, and 2) help adopters implement them. Much of that evolution has occurred around what the industry calls its technology value chain: the system components required to complete an end-to-end solution. For the last half decade, most of the work performed in M2M has been on the refinement and consolidation of that value chain. Countless alliances and acquisitions have been made, all designed to make it easier for adopters to buy and use the technology. As a result of this multi-layered value chain, M2M customers come in several forms. First are the end users or corporate adopters—in other words, the companies that use the networked machines and other assets in their own operations. There are also several other types of companies that buy M2M. There are OEMs and product manufacturers that connect the technology to the products they manufacture so they can be monitored at customer locations. There are also companies that buy modules to make terminals and modems, and companies that in turn buy terminals and modems to build application systems. Together, these companies and their technology suppliers make up the M2M industry, which is the focus of the m2mpremier.com website.

The Six Pillars

At the 2007 M2M United industry conference and tradeshow, M2M magazine Editorial Director Peggy Smedley introduced a new graphic that helps encapsulate the ever-expanding M2M universe. The graphic covers the “six pillars” of machine-to-machine technology, representing market segments that all involve networking physical assets and integrating machine data into business systems. The six pillars of M2M are 1) remote monitoring, 2) RFID (radio frequency identification), 3) sensor networking, 4) smart services, 5) telematics, and 6) telemetry. M2M 6Pillars_lores 6) Telemetry is usually associated with industrial, medical, and wildlife-tracking applications that transmit small amounts of wireless data. 5) Telematics is the integration of telecommunications and informatics, but most often it refers to tracking, navigation, and entertainment applications in vehicles. 4) The term “smart service” refers to the process of networking equipment and monitoring it at a customer’s site so that it can be maintained and serviced more effectively. 3) A sensor network monitors physical or environmental conditions, with each sensor node acting cooperatively to form and maintain the network. 2) RFID (radio frequency identification) is a data-collection technology that uses electronic tags for storing data. 1) Remote monitoring is a generic term most often representing supervisory control, data acquisition, and automation of industrial assets. Each of the pillars represents a different set of technical skillsets that have to be combined for the end user to get the full value from the completed system. It’s that completed system—and that combined set of technologies—that makes M2M so vital. M2M is the glue that fastens the six pillars through a common set of best practices, networking methodology, and scalability. Take away the glue, and end users are left with multiple application platforms and network accounts. Analysts often profess the importance of machines speaking a common language, but that doesn’t have to mean a singular data protocol. Instead, it means enabling the user to network all of its physical assets with a common infrastructure and a consistent methodology for gathering machine data and figuring out what it means. The true power of machine-to-machine occurs when it’s working behind the scenes, and that can’t happen if companies have to manage multiple, independent systems.

The Internet of Things

As the M2M industry has matured, companies have embraced the six pillars in their messaging to customers, and we think this is a healthy and necessary step. In order to sell technology effectively, it must be delivered in the customer’s own terms. Since the first issue of M2M, for example, the magazine has predicted M2M would diverge into vertical applications with a horizontal set of technology components: “Whether it’s called M2M, pervasive computing, telemetry, invisible mobile, telematics, or none of the above, information is sitting inside machines that make up the financial and operational core of every company in business today. Most processes are already executed based on the performance and status of those assets, but rather than coming from the machines themselves, the data shows up in accounting metrics like unit production, cost, and profit.” M2M has gone a long way toward uniting business intelligence and machine data. People may call it smart services, sensor networking, or telematics, but in the end what they all have in common is connecting the world to a network—and that’s M2M.