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Massive growth forecast for M2M in retail

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The number of cellular machine-to-machine (M2M) connections in the retail industry reached 23,1-million worldwide in 2014, according to a new research report from Berg Insight.

Cellular M2M technology enables devices such as POS terminals, ATMs, digital signs and ticketing machines to be used at new locations where fixed line connectivity is unavailable or impractical. The technology has a more transformational effect on markets such as vending and parking, where machine operators need to reorganize their operations in order to benefit from the availability of real-time information.

Berg Insight forecasts that the number of cellular M2M connections in the global retail industry will grow at a compound annual growth rate (CAGR) of 13,9% during the next five years to reach 44,3-million connections in 2019. Shipments of cellular M2M devices for retail applications will at the same time increase at a CAGR of 7,1% from 9,4-million units in 2014 to 13,2-million units in 2019.

POS terminals constitute the largest device segment and accounted for 90% of all cellular M2M connections in the retail industry at the end of 2014. The market for wirelessly connected POS terminals is however relatively mature, and most of the market growth is driven by the increasing use of electronic payments in emerging markets. In terms of penetration, the multi-space parking meter segment is furthest ahead.

The multi-space parking meter segment was one of the first vertical markets to embrace cellular M2M connectivity and has reached a penetration rate well above 50%. In recent years, cellular connectivity has also found its way into the single-space parking meters market, which has become one of the fastest growing segments.

Berg Insight expects that the vending machine segment will present a major opportunity for wireless connectivity in the long term, and today just 1,2-million of the world’s 17-million vending machines are online.