SAP and Ericsson join forces on M2M services

The two will develop services that will be offered to enterprises by operators

Ericsson and SAP will jointly market and sell cloud-based, machine-to-machine (M2M) products and services to enterprises via operators around the globe.

The M2M market is very fragmented, posing a challenge for any company that wants to enter the space. To address this operators, telecom equipment vendors and enterprise vendors are joining forces in different configurations to simplify the roll-out of services.

The goal with the agreement between SAP and Ericsson is to make it easier for operators to offer enterprises cloud-based M2M services using SAP's HANA platform and Ericsson's Device Connection Platform & Service Enablement platform. The two companies are already discussing the model with operators, but didn't give any details on when the first services are expected to become available and what they will cost.

Ericsson's platform is used by operators such as 3UK, Megafon, Swisscom and TeliaSonera.

The advantages of moving M2M services to the cloud are the same as with other cloud-based services; lower up-front investment and faster time-to-market, according to a joint statement.

The number of global M2M connections is expected to increase from 2 billion at the end of 2011 to 18 billion at the end of 2022, making up 22 percent of cellular connections and 61 percent of all connected devices. Intelligent buildings and consumer electronics will dominate, followed by sectors such as utilities, automotive, health care and smart cities, according to Machina Research.

At the same time revenue is expected to grow from US$200 billion to $1.2 trillion. Two-thirds of the revenue comes from devices and installation, and one-third from services. Again, intelligent buildings, consumer electronics and automotive will be the dominant revenue generators, Machina said.

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