Skip to main content

Why the Internet of Things is Growing in China

The rapidly evolving global machine-to-machine (M2M) device market is largely characterized by cellular module shipments and connections. Moreover, some regions are clearly growing much faster than others.

The cellular connection revenue in China -- which constitutes more than one-third of the Asia-Pacific (APAC) M2M market -- is expected to grow from $642 million in 2011 to $2.76 billion in 2016.

"China’s latest economic five-year-plan has placed the Internet of Things as a key, strategic national industry initiative for the country," said Jake Saunders, vice president of forecasting at ABI Research.

Mobile network service providers have made significant progress through 2011 in terms of developing technologies, unified platforms, applications, and strategic cooperation.

China Mobile started M2M development early, positioning it as its third wave of its long-term business offerings. It has also moved into developing M2M standards and promoting economies of scale, positioning itself as an integrator with no real focus on an end-to-end solution approach.

China Unicom has launched sector-specific M2M applications such as Bank New Horizon, Ocean New Horizon, and Logistics New Horizon. In addition, China Unicom has also made inroads into the high-growth market as a telematics service provider (TSP).

China Telecom is a late-comer in the domestic M2M market and seeks to gain fast market entry by offering value-added services through their strong relationships with enterprise clients.

The cellular module market, a key measure of the M2M market currently, is facing growing commodity price pressures from China-based module vendors. Lower operating costs have played a significant part in this ongoing commoditization trend and have forced western module vendors to up their game by moving up the value chain.

In addition, the three largest Chinese module vendors are able to leverage the scale of adjacent product offerings. China's cellular module shipment is forecast to grow from 3.76 million in 2011 to an estimated 13.61 million connections in 2016 -- that's 32 percent of APAC’s forecast in 2011 and growing to 37 percent by 2016.

Popular posts from this blog

Navigating AI Implementation Challenges in 2025

As we approach 2025, the global Artificial Intelligence (AI) market is poised for significant growth. Traditional AI spending is rising, while Generative AI (GenAI) struggles to meet lofty expectations. This apparent dichotomy presents challenges and opportunities for vendors and business leaders navigating the complex world of AI implementation. Let's explore the overall situation. Traditional AI: A Pragmatic Approach In the coming year, we expect to see a surge in traditional AI spending as enterprises seek pragmatic, ROI-driven solutions. This trend is driven by a growing recognition of the limitations and risks associated with GenAI projects, which have shown alarmingly high failure rates of 80 to 90 percent in proof-of-concept stages. The trend towards traditional AI is further supported by data from Amazon Web Services (AWS), which revealed that over 85 percent of AI projects in 2024 were not based on GenAI.  This insightful statistic underscores the continued relevance and ...