There used to be a joke in the ITU about fixed wireline solutions that a third of the world had dial tone, a third was waiting for dial tone (because the phone service was so bad) and a third of the world had no dial tone (and probably did even know what dial tone was).
Well, it turns out that wireless solved that problem for the third of population that was waiting for dial tone, but still has a long way to go for the rest of the marketplace. According to a GSMA study, only 45 percent of the worldwide population (3.2 B) is using those 5.9 billion “phones.”
“This research, for the first time, highlights the difference between mobile connections and individual mobile subscribers, and points to a significant growth opportunity for the mobile industry as we continue to connect the world’s population,” said Anne Bouverot, Director General of the GSMA.
So in effect, most of us who have a phone have a second one or SIM attached to another device like a tablet. While the GSMA study did a great job of looking at the opportunity for the third that did not know what dial tone was, the expected growth rate to 4 billion is modest compared to what they unearthed in the study about M2M.
The calculation on M2M was that there were only about 600 million possible SIM-based M2M implementations in a marketplace estimated at 50 billion devices that are addressable as the Internet of Things.
This stat suggests that we are a nascent marketplace that has not begun to hit the steep curve of demand. This is very striking because it also has huge implications for growth opportunities in fulfillment needs. Digi International and KoreTelematics were both winners at our Battle of Platforms event because of their direct impact on the growth potential. Digi won for making more sensors addressable to the wireless marketplace overall and Kore won for enabling global solutions by the carriers.
The places where wireless is developed are the places that are going to be exporting M2M and as such global reach is important. And with only about one percent of the Internet of Things having SIM cards, we have landed on the metaphoric island where the shoe salesman finds everyone barefoot.
Speaking of which, I was surprised by this line from the press release:
“According to the research, approximately a third of the world’s population of 7 billion are unlikely to be able to subscribe to mobile services for a variety of reasons, resulting in an ‘addressable’ mobile subscriber base of around 5 billion.”
Clearly this is the other salesman turning back with his entire inventory.
Note: For those who never heard the story (and clearly have avoided sales meetings, the story goes that two shoe salesmen are on a boat that lands at a tropical island where they discover no one wears shoes. The first salesman cables his company, “Returning home, no market for shoes,” while the other cables he needs more inventory, because the market is “untapped.” This then gets used to beat up the sales force as they are asked which salesman would you be and perhaps you just don’t see the opportunity. Given Nicholas Negroponte’s initiatives I would suggest the market is bigger than the SIM chips.
Edited by Stefanie Mosca