M2M - the OEM advantage

By : Jim Pinto,
San Diego, CA.

The next major inflection point of Internet usage is machine-to-machine (M2M) communications. Within the next few years, more machines will be connected via the Internet than humans. This will add significant value for businesses and consumers.

A version of this article was published by:
Automation World, July/August 2004

The OEM business is tough – highly competitive with slim margins. It's not often that technology arrives to give OEMs a significant competitive advantage. One of those opportunities is emerging now – the machine to machine (M2M) communications revolution. Get on board!

Today, most Internet usage is still human oriented – information that allows people and businesses to interact with each other. With a human population of only about 6 billion, this type of Internet connection is reaching saturation.

The next major inflection point of Internet usage is machine-to-machine communications. This will far surpass human communications in scope, value, and sheer numbers. Within the next few years, more machines will be connected via the Internet than humans. Eventually reaching tens of billions of connections, machines will communicate with each other, as well as with data mining and processing systems that will automate the communication and interpretation of the mass of data they gather. This will add significant value for businesses and consumers.

The pervasive Internet

The term “Pervasive Internet” refers to the convergence of machine-to-machine communications, Internet connectivity, enterprise-level data-management applications, and Web-based smart services. The phenomenon arises from the connection of smart devices to the Internet, enabling fully automated global communication, data-collection and control.

Today, a whole new environment of M2M is emerging, focused on the issues of how machines communicate, how they are managed, how the data and information within them are managed, and perhaps most importantly, how the world (humans, businesses and society) can deal with them.

M2M – the OEM advantage

Today, most PCs are connected to the Internet, which allows operating errors to be reported automatically to the PC manufacturer or software suppliers. Operating system and software upgrades are downloaded automatically when available. When new virus alerts occur, the latest anti-virus updates are downloaded automatically, minimizing the impact.

Similarly, automatic M2M communications on OEM equipment can provide a significant benefit to both supplier and end-user. It can lead to dramatic cost reductions and drive enhanced customer service initiatives, facilitating new and significant revenue models.

Networked "embedded intelligence" is what pervasive computing and M2M are all about. The information coming from a device can be just as valuable, if not more valuable, than the device itself: for example, current location, part number, where it was purchased, when it was installed and by whom, critical specifications, diagnostics, availability of spares, replacement alternatives, repair instructions, usage patterns, and more. All this invisible machine activity makes the information about assets, costs, and liabilities vastly more visible to managers and to the decision-making process.

In the past, to optimize performance, or to prevent downtime, or degradation of performance, OEMs offered end-users repair, maintenance or service agreements. The ability to harvest detailed and specific information from a company’s own equipment, while it is in operation in the customer’s application and environments, brings a whole new gamut of revenue generating services and possibilities.

With effective M2M, equipment can provide information about use (or misuse) trends or single events. Machines can be networked to each other to develop statistics on operating performance, predictive diagnostics, downtime analysis and a host of related monitoring and control information. Actionable decisions can be made quickly, with clear, cost-saving advantages.

In this information-driven age, the next wave of OEM business strategy is to take advantage of equipment operating information that most end-users don’t have the knowledge or ability to collect. It puts the OEMs knowledge of the equipment into direct service of the end-user, collecting operating statistics that both can utilize.

As applications become more sophisticated, OEMs can offer their end users increasingly complex interactions with their traditionally dumb equipment assets. In many cases, the human intermediaries can be removed from the equation. Given defined and controlled parameters, equipment assets themselves can make the key decisions, providing optimum cost-effectiveness for OEM and end-user alike.

The M2M revolution will transform the way that OEM equipment is deployed. Most often, the valuable, detailed operating information is already there, sitting inside the equipment, waiting to be collected and used. Through the use of M2M, end-users and OEMs can eliminate the barriers of distance, time, and location.

M2M will unleash a wave of productivity and efficiencies previously unseen. It might be a good idea to look into M2M solutions for businesses since the market is still young so you can be ahead of the curve in terms of efficiency. When manufactured objects are continually sending field intelligence back, OEMs will be able to shed costs, explore new revenue opportunities, and solve customer problems as never before.

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Copyright 2003 : Jim Pinto, San Diego, CA, USA