Proving the Business Case for the Internet of Things

2G accounted for 70% of cellular M2M modules in 2013: ABI

Iain Morris
July 31, 2014
 
Modules that work on 2G networks accounted for more than 70% of worldwide M2M cellular module shipments in 2013, according to a new study from ABI Research.

The dominance of 2G was maintained despite a rapid drop in 2G shipments in the North American market, to less than 60% of the total modules shipped in the country.

Global revenues from module sales came in at more than $1 billion in 2013 for the second straight year, even though the continued dominance of 2G limited the growth of worldwide revenues.

North American operators including AT&T (Dallas, TX, USA) and Verizon Wireless (New York City, NY, USA) have revealed plans to stop operating their 2G networks in the next few years, moving all traffic on to higher speed 3G and 4G technologies.

Currently, however, the modules that will function on these networks are costlier than those engineered for 2G systems.

ABI says the strength of 2G is also reflected in the CDMA market, where 1XRTT shipments grew by more than 100%.

Nevertheless, EVDO – the higher bandwidth cousin of 1XRTT – fared relatively poorly, with its share of overall shipments declining in 2013.

“LTE M2M modules started to show their impact in 2013, not due to a dramatic increase in shipments, but on limiting growth of 3G modules,” said Dan Shey, a practice director with ABI. “EVDO module shipments were hit the hardest.”

“While we expect EVDO to maintain a stable share of the overall market, this technology is most susceptible to competitive forces and for replacement by other 2G, 3G and 4G technologies,” he added.

ABI expects LTE shipments to begin accelerating in 2014 and 2015 driven initially by the adoption of OEM telematics.

It also predicts that aftermarket telematics, which enjoyed the biggest unit shipment gains in 2013, will maintain solid double-digit growth over the forecast period.

Smart grid spending – which is picking up in Europe – will also contribute to a steady rise in module shipments and revenues, says the company.
 
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