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Magic Quadrant for Managed Machine-to-

Machine Services, Worldwide
26 August 2015 | ID:G00271517
Analyst(s): Eric Goodness, King-Yew Foong, Leif-Olof Wallin, Katja Ruud
Summary
The use of managed M2M services is an important element of many Internet of Things
solutions. Sourcing executives should consider the 11 evaluated providers, which vary
by geographic coverage and service breadth. These providers collectively manage more
than 90 million cellular M2M connections.
Market Definition/Description
Gartner's coverage of managed machine-to-machine (M2M) services focuses on
providers that bundle cellular connectivity, M2M technology and related technology
services that facilitate key business outcomes.
In Gartner's definition, M2M communications are used for automated data transmission
and measurement between mechanical or electronic devices. Key components include
field-deployed wireless devices with embedded sensors or RFID; wireless/wireline
communication networks, including, but not limited to, cellular, Low-Power, Wide-Area
(LPWA), Wi-Fi, ZigBee and xDSL; and a back-end network that interprets data and
enables decision making (or automates action/control of the monitored asset's state).
M2M solutions are machines talking to machines or, more often, machines talking to
intelligent systems that obviate human intervention relating to alarms, service-
impacting incidents or rule-based actions in terms of asset control or optimization.
While M2M connectivity spans cellular networks, fixed-network services, sensor
networks and Wi-Fi mesh services, this Magic Quadrant focuses on cellular connectivity
and related value-added services, such as consulting, M2M device engineering, M2M
application development and integration, software hosting, and related system
management.
M2M services are broken down into the following capabilities:
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Sourcing and logistics management includes the systems and services for enterprise
customers to purchase and provision components of a managed M2M service
solution, such as network services (connectivity), systems, application functionality,
and related devices. Included in this capability is the use of portal-based service
catalogs with self-service capabilities (for example, device and SIM acquisition,
provisioning and activation). Reverse logistics support includes engineering, kitting,
depot repair and advanced replacement. Connectivity devices are included in the
scope of managed M2M services, but devices with a general user interface, such as
smartphones and tablets, are not included.
Service management includes the systems and services to track and manage
network contracts and SIM-generated information (for example, network usage
patterns, related assets and service elements). Service management may also audit
and log network service performance and availability, as well as assign qualitative and
quantitative ratings to communications service providers (CSPs) relating to
negotiated SLAs. Service management also offers the ability to audit and optimize
spending on connectivity services based on ongoing inspection of contracts, standing
inventories and usage/consumption details. The systems and services usually
support rule-based business process automation, such as actions relating to
excessive usage, usage nearing a prescribed threshold, SIM activations or related
geolocation faults.
Device and system management includes the systems and services that make
connectivity devices and managed asset information visible; applies health
diagnostics to measure device performance; manages connection modality options
(for example, cellular, hot spot and Wi-Fi); and establishes process control for
consistent change and release management (related to OSs and support systems).
This discipline also includes service desk capabilities to address technical requests
(Levels 1, 2 and 3). Some systems and services support the aggregation of rule-based
and cognitive event processing from managed asset platforms. This includes
possible business process automation relating to service-impacting incidents.
Application management includes the systems and services to enable custom and
proprietary M2M application publication and distribution across diverse middleware,
devices, OSs and protocols. This service offering often includes release and change
management, incident management and problem management of M2M enablement
platforms. Application development relating to the collection and analysis of M2M
connected data is in the scope of this Magic Quadrant; however, the development of
front-end applications relating to B2B or business-to-consumer (B2C) or B2B-to-
consumer (B2B2C) functions is not in the scope of this Magic Quadrant.

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Security management includes the systems and services to administer and enforce
policies relating to the identity and access of things and the transmission of data and
consumption of business services linked to connected assets. Requests for release
and change management related to security management are generally controlled by
the provider, unless the user requests administrator rights. The systems and services
allow authorized providers and customer administrators to establish and enforce the
privacy policy for their devices, machines and assets. Included in the scope of this
service level is private Access Point Name (APN) and managed VPN services.
Reporting, analytics and data presentment includes the systems and services to
enable data presentment, business intelligence reporting and analytics resulting from
monitoring systems and the underlying complex-event processing. Basic reporting
would provide visibility into alarms by asset group, auditing reports, alarm frequency
reports, and device event and status reports. Dashboards and data visualization offer
an ability to analyze trends on performance, service-level agreements (SLAs),
compliance and operational metrics. More advanced reporting and analytics would
offer actionable intelligence relating to asset utilization, contextualized data from
customer engagement, more efficient system architectures, improvements to
products, and rationale for monetization of connected solutions.
Program management and financial management includes the ability to act as an

agent on behalf of a customer with third-party providers, such as third-party network
operators, M2M application independent software vendors (ISVs), M2M device OEMs
(inclusive of device certification), and potential alliance partners and device resellers.
This category is related to ongoing and project-based services (for example, service
outages, network performance and coverage issues; warranty management; and
device upgrade management). Financial management relates to audits, payments,
disputes and allocation of expenses. Included with this service offering may be
service contract novation (to become customer of record), along with the assumption
of ownership of devices and customer-owned service, and device management
software. Solution financing is also considered within program management and
financial management.
These service functions fulfill large parts of Internet of Things (IoT) solutions. In fact,
many providers in this Magic Quadrant are reorienting their market messaging around
IoT rather than M2M. However, IoT relabeling does not make their solutions truly an IoT
solution. While not codified explicitly, what distinguishes typical managed M2M service
offerings from IoT solutions is the value-added systems and services, such as vertical
applications and the creation of mobile apps to extend customer engagement from the
captured machine data, as well as tie-ins to emerging and legacy enterprise
applications.

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Provider Models
M2M services are, in general, offered by three types of providers: M2M service
providers, CSPs and M2M service aggregators.
All providers extend solutions as a monthly recurring charge (MRC) per-cellular
connection unless otherwise noted. Most providers include service management
capabilities in the per-connection MRC. Ultimately, MRCs extended to users can also
bundle in, and amortize: devices, gateways and device management software, along
with proprietary, or commercial-off-the-shelf, M2M application development software.
More advanced solutions may also bundle value-added M2M applications, such as
analytics and visualization, content acceleration and distribution, smart city solutions,
and geolocation and fleet management software in the MRC.
M2M Service Providers
These providers are mobile virtual network operators (MVNOs) and companies
associated with an operator that can piggyback on that operator's roaming agreements.
Providers in this Magic Quadrant that fall within this provider type include Aeris,
Arkessa, Kore and Wyless.
Communications Service Providers
CSPs are alternatively referred to as "mobile network operators (MNOs)." Some CSPs,
such as Orange Business Services in Europe and AT&T in North America, have quietly
supplied M2M services for several years. However, CSPs are now marketing M2M
services more vigorously, and those without a strong M2M presence so far are treating
it more seriously by increasing their marketing or creating dedicated M2M service
divisions. Providers in this Magic Quadrant that fall within this provider type include
AT&T, Deutsche Telekom, KPN, Orange Business Services, Telefónica, Verizon and
Vodafone.
M2M Service Aggregators
These providers encompass traditional outsourcers (for example, Accenture, HP and
IBM), application service providers (for example, CallPass Tech, IPS Group and Spireon),
and system integrators (SIs) that bundle connectivity into system resale and integration
(for example, Avic, Integron, and Open Terra). Often, deep vertical market acumen is the
true point of differentiation in these providers' offerings to the market. Although Gartner
expects the visibility of these providers to increase rapidly during the next three to five
years, no vendors within this emerging provider type qualified for this Magic Quadrant
based on the inclusion criteria. Other small providers within this market segment
include FW (a Novatel Wireless company) and Modus.

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Magic Quadrant
Figure 1. Magic Quadrant for Managed Machine-to-Machine Services, Worldwide
Source: Gartner (August 2015)
Vendor Strengths and Cautions

Aeris
Aeris is an M2M service provider. Aeris was founded in 1992 and is based in the U.S.,
with an office presence in the U.K. Aeris has its own purpose-built core mobile network,
M2M connectivity, application enablement and data platforms. The company is also

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striving to increase value through applications and analytics. System integration,
application development and support are provided through partners. Aeris goes to
market with a direct sales force (based mostly in North America) and resellers, as well
as with a self-service portal. Successes in connected M2M solutions are mainly in the
automotive and fleet management sectors. Gartner estimates that Aeris managed
about 3.765 million cellular M2M connections as of the end of 2014, with approximately
99.8% of those connections located in North America.
STRENGTHS
Customer feedback and a review of the Aeris M2M customer portal and onboarding
documents reveal that Aeris offers M2M connectivity customers extreme ease of use.
Many customers cite the ease of device activations and management as best-in-
class.
Multiple Aeris customers cite strong price competitiveness for M2M services relating
to value (that is, price to value in relation to performance and SLAs). Many customers
also cite strong postsales account management by Aeris. Aeris has recognized 100%
year-over-year growth for the last four years. In addition, the company reports it
exceeded its 2015 projected numbers by the second quarter of 2015. Such growth
affirms the Aeris value proposition and market approach.
Aeris invests a high proportion of its revenue in research and development (R&D),
demonstrating its commitment to technology leadership. Aeris has developed and
maintains a complete M2M core network, including a custom Home Location Register
(HLR), Home Subscriber Server (HSS), Policy and Charging Rules Function (PCRF),
billing system, and other components. This complete M2M core network is the
primary difference relative to MVNOs, which leverage the consumer network core and
build a provisioning layer/portal on top of it. Additionally, the Neo self-service portal
has brought simplicity and streamlined workflows to the process of ordering,
provisioning and activation of M2M services.
CAUTIONS
Although Aeris is able to support global M2M connected solutions, through its
multigeographical-based network operation centers (NOCs) and growing offshore
workforce, the company is focused primarily on North America, and customer support
is available in English only. The company has improved its installed base of
international connections; however, customers indicate that Aeris' current operations
make it difficult to continue expansion of their managed M2M solution, should they
decide to expand globally.

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Some customers cite Aeris' weak Global System for Mobile Communications (GSM)
coverage in the U.S. as problematic for choosing Aeris as a service provider for their
M2M solutions. Although Aeris' GSM coverage footprint in the U.S. actually spans the
two GSM mobile network coverage providers, the company acknowledges that
additional education and training are required to be able to overcome the GSM
coverage shortage perception by prospective customers.
Aeris has experience in the resale of third-party value-added services spanning device
management, M2M application development or IoT analytics and visualization.
However, Aeris' organic offerings for the same services are embryonic and currently
capable of onboarding clients.
Arkessa
Arkessa is a U.K.- and Germany-based M2M service provider, with approximately 90% of
its revenue coming from related solutions. It aims to make M2M communications and
data management easy for clients, based on its management platforms and a staff
dedicated to orchestrating CSP relationships and connectivity offerings. Arkessa is
largely industry-agnostic in its approach to the market, but it generates most of its
revenue from the energy, utility and transport infrastructure — particularly, smart
metering solutions. Its route to market is with leading global system integration
partners and direct sales to the enterprise. Gartner estimates that Arkessa managed
approximately 569,000 cellular M2M connections and devices by the end of 2014, with
approximately 95% of these connections in Europe.
STRENGTHS
Arkessa's customers are highly satisfied with Arkessa's customer support,
multivendor network aggregation and network availability.
Many Arkessa customers state that the provider makes it easy to conduct business
with their organization. Sales and technical account management score high marks
for responsiveness and follow-up.
Arkessa has more than 10 years of experience in serving small or midsize businesses
(SMBs) with M2M connectivity assurance and tariff optimization, as well as presale
services, such as device optimization, and protocol and network design. Arkessa also
resells other CSPs' local tariffs and roaming solutions, thus giving its customers a
range of cost-effective connectivity options — from very low data to very high data.
CAUTIONS
While account management is believed to be very good, some customers point to
quality problems relating to billing information and quality of reporting. This situation
has required some users to invest in time in an auditing process and vendor

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management. Arkessa has been investing specifically in technology, systems and new
recruits in customer support and service delivery.
Arkessa has a small team of M2M specialists, software developers, and technical
support and order fulfillment specialists based in Europe, and many of its customer
engagements are based in Europe. While technical assistance and expertise are cited
as being very good, some customers cite lapses in resource availability and
lengthened cycle time to remediate issues. Arkessa has made recent key
appointments in customer support to alleviate this situation and continues to build
the best team possible as it expands in key territories.
Arkessa's small size makes it difficult for it to influence each mobile CSP's
performance and service delivery. Some customers cite average service-level
commitments.
AT&T
AT&T is a CSP based in the U.S. The company's M2M business focuses on broad
connected solutions, which are generally predicated on cellular connectivity that
leverages AT&T's various service delivery platforms (SDPs) and IT services. The
company goes to market with a balanced direct and indirect channel model with partner
MVNOs and some SIs. AT&T's success in M2M connected solutions has been in the
automotive, energy and utility sectors. Gartner estimates that AT&T currently manages
19.8 million cellular M2M connections and devices, with less than 3% of those devices
residing outside of North America. More than half of those connections leverage 3G and
4G connectivity.
STRENGTHS
AT&T bring to market a near-complete IoT platform stack: devices, service SIM
management, device management, storage as a service and data management, as
well as an open-source M2M development environment. These investments in an
M2M and IoT platform lower the customers' barriers to building IoT solutions and
position AT&T as a single point of expertise and value for expedited time-to-solution
benefits.
AT&T offers value-added application solutions, such as its Cargo View and heavy-
equipment asset tracking. AT&T will continue to commit to sector-specific value and
innovation to offer IoT solutions — from device to cloud to business outcome.
AT&T utilizes a range of U.S.-based, global, national, and regional service and support
organizations for its IoT and M2M customers. Tier 2 and Tier 3 support is provided by
a range of organizations, including the AT&T Global Network Operations Center,
contracted MNOs for service issues in their countries, AT&T technical support

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organizations in several countries, AT&T IT operations groups, and technology alliance
partners for their software and hardware as needed (including Jasper, PTC-Axeda and
several others.)
CAUTIONS
Although AT&T maintains an installed base of international M2M business, the lack of
size and growth in the international business could be a concern for large U.S.-based
multinational corporations (MNCs) looking for a localized international wireless
experience.
AT&T's installed base has been historically focused on the lower-cost 2G connectivity
and related devices. As AT&T approaches its scheduled shutdown of its 2G network in
2017, the company must carefully manage the migration of its installed base from 2G
to newer technology so it does not impact contract renewal and cause instability in its
installed base.
The size of AT&T can make it complex for customers to engage with it. Customers
with small M2M service requirements may not receive the necessary level of support.
Deutsche Telekom
Deutsche Telekom is a CSP based in Germany. It has a strategic approach, extending
from access products to more horizontal functional solutions and also end-to-end
solutions, with T-Systems as a key internal driver for IT and integration services. Gartner
estimates that Deutsche Telekom, a large provider in the segment, has more than 11
million M2M connections, and it serves Europe and the U.S. directly and leverages
partner networks for rest-of-world connectivity. Deutsche Telekom also has a vertical
focus, including health, automotive and logistics, industrial automation, energy, and the
public sector, with a portfolio of available solutions in all areas.
STRENGTHS
Deutsche Telekom spends one of the highest portions (in this peer group) of its M2M
revenue on R&D related to this segment, with a structured innovation approach that
includes both internal and external ventures — including a large developer community.
The recent release of its "Cloud of Things" device management service provides the
market a more complete platform for expedited time-to-solution benefits.
Deutsche Telekom is the provider with the largest percentage of connected devices
outside of its home territory. Deutsche Telekom's North American M2M business is
based largely on resale agreements with MVNOs.
Deutsche Telekom's solutions are supported in the most languages (30), which helps
support local users in a global environment and paves the way for inroads into
markets where it currently has a relatively low presence.

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CAUTIONS
Despite the legacy of T-Systems, Deutsche Telekom has not yet fully leveraged its
existing access customer base with regard to attaching value-added services. Some
customer references state that the company is still used primarily for connectivity and
that the company has not profoundly influenced the IoT strategy to transform
business processes.
T-Mobile USA has long been for sale, but this has yet to be realized. However, such a
sale could negatively impact the possibilities for North American capability and
delivery.
Deutsche Telekom's Cloud of Things device management platform is not yet fully
integrated with its M2M connectivity platform, but the implementation is planned to
be completed by the end of 2015. Therefore, workflow may be challenging, as
connectivity management and device management activities are offered as separate
work streams for ongoing operations.
Kore
Kore is an M2M service provider based in the U.S. The company goes to market directly
for multinational companies and also partners with many CSPs, SIs and IoT ISVs. Kore
successfully services multiple vertical markets, including automotive, healthcare, energy
and utilities, insurance, transportation, and retail. Gartner estimates that by the end of
2014, Kore managed more than 3.2 million cellular M2M connections and devices
through its platform services, with less than 7% of those devices residing outside of the
U.S. The majority of those connections are 2G, although we estimate that Kore's
3G/Long Term Evolution (LTE) connections will more than double through 2015 as a
percentage of the installed base. Kore's major areas of focus for value-added IT
services are technology consulting, device engineering and certification, and M2M
application integration.
STRENGTHS
Kore maintains an installed base in all five geographies. It also has a good distribution
of operational, professional services and product development employees. The
company is able to support multinational companies for global M2M initiatives.
Kore's technical support staff receives very high marks for its technology expertise, its
responsiveness to customer queries and the company's ability to provision technical
resources to remediate service impacting incidents.
Kore's partnerships and operational scale allow the company to best many Tier 1
CSPs in terms of operational efficiencies, coverage and cost-savings. Kore offers a
range of technologies —including 2G and 3G GSM and code division multiple access

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(CDMA) technologies, and 4G LTE, as well as satellite services.
CAUTIONS
A regular customer complaint from Kore customers is that there is weakness in the
account management process relating to billing inquiries and audit requests. The
most common characterizations are "slow to respond" and "unresponsive." Customers
regularly identify the need to invest in unwanted time tracking down Kore personnel.
The acquisition of RacoWireless provided the greater part of Kore's growth. Organic
growth lagged its primary MVNO competitors and lagged some of the largest CSPs
with much larger bases of installed devices.
A growing complaint from some users point to weaknesses in Kore's PRiSMPro
service management portal. Reference customers identified workflow and other
issues, such as slow user response times and a lack of contemporary feature sets.
Kore will need to work to reflect market needs for network visibility and intelligence
reporting.
KPN
KPN is a CSP based in the Netherlands. The company targets transport and logistics,
healthcare, utility, retail, and government (smart cities, public transport and critical
communications). The utility vertical is responsible for a large part of KPN's current
M2M business. By the end of 2014, KPN managed 953,000 cellular M2M connections
and devices, with the vast majority of this installed base in the Netherlands and the rest
mainly in Belgium, the U.K., France and Germany. Approximately 90% of these
connections are 2G.
STRENGTHS
KPN's M2M business, which is focused on the utility sector, has built an independent
big data platform for all three energy networks in the Netherlands. The platform is
aimed at utility application providers, and it helps them to understand their business
better.
KPN has developed leading-edge use cases for smart systems, and it has an
estimated 20% of its M2M revenue coming from nonconnectivity sources, versus the
significantly lower 5% to 10% from many providers in this Magic Quadrant.
KPN is co-founder of the LoRa Alliance to establish a global standard for long-range
low-power (LoRa) connectivity to enable IoT and M2M use cases. KPN will introduce
LoRa in the Netherlands before the end of the year. LoRa opens up new connectivity
opportunities for KPN in cases where a traditional cellular-based solution has a
negative business case due to hardware cost, power consumption or both.

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CAUTIONS
KPN is Netherlands-centric. Expanding its innovative solutions internationally will
require go-to-market (GTM) partnering with large industry players that have their own
agendas and many other suitors.
The IoT Academy initiative, by KPN and Makerspace, is an important step to work
together with the application development community, but it is still in an early stage.
The relatively small size of KPN's M2M installed base, and its laserlike focus on the
Dutch market, limits its attractiveness to international developers.
KPN's solution relies solely on partners such as Jasper and the M2M World Alliance
that have many other larger partners. KPN also has relatively little influence on this
larger solution ecosystem.
Orange Business Services
Orange Business Services is the enterprise service unit of French CSP Orange. Orange
Business Services' M2M business focuses on end-to-end M2M service implementations
and IoT solutions built on M2M communications services. The company's primary route
to market is direct and extends indirectly through partnerships with MVNOs, hardware
providers and software providers, as well as SIs. Gartner estimates that by the end of
2014, Orange Business Services managed 5.2 million cellular M2M connections, as well
as 1.2 million noncellular connections and related devices, with less than 6% of those
devices residing outside of Europe. The majority of the M2M cellular connections are
2G. Orange Business Services' major focus for value-added IT services are technology
and business process consulting, device engineering, and application development and
integration.
STRENGTHS
As a global operator and global integrator, Orange Business Services offers the
market one of the broadest and advanced professional services organizations
dedicated to digital businesses that leverages managed M2M services. Orange
Business Services' legacy outsourcing business that spans network, data center and
applications has shown strong capabilities to plan, build and deploy IoT-connected
solutions that go beyond managed M2M services. Orange Business Services provides
a range of wireless technologies in addition to cellular to provide different M2M/IoT
connectivity solutions to its customers. Orange already has over 1.2 million non-
cellular wireless connections.
Orange Business Services' continued investments in technological innovation and

research are driven by both Orange Applications for Business (OAB) and Orange
Mobile Enterprise, with the close support of Orange Labs and Technocentre. These
organizations are able to surround customers with value-added services for deeper

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technical and business insights and expedited time-to-solution benefits. Orange
Business Services recently acquired Ocean, making Orange Business Services a
leading European fleet management service provider.
Orange's partnerships in the FreeMove Alliance and Global M2M Association provide
access to broad European partner networks, predicated on transparent pricing, and
collaborative network enhancements and innovative services, to extend its M2M
solution portfolio across Europe. Additionally, FreeMove's announced partnership with
the Bridge Alliance promises to extend similar advantages into the Asia/Pacific and
African markets.
CAUTIONS
Of the global CSPs in this Magic Quadrant, Orange Business Services' installed base
of managed M2M services is the smallest in cellular connectivity. Year-over-year
growth projections also lag behind its competitors, and the installed based is Europe-
centric, with modest connectivity in the rest of the world. Orange Business Services
has yet to demonstrate that it can handle successive, large, globally distributed
opportunities.
Conversations with several Orange Business Services customers identify an

organization that can be difficult to work with at several levels of a managed M2M
service engagement. The primary area of concern among some customers is
navigating the sourcing and acquisition process. The benefits of recent Orange
Business Services organizational changes and the new standardized M2M
comprehensive portfolio have still to be fully realized, thus making it difficult to bridge
multiple Orange Business Service units to create nonstandard solutions.
Orange Business Services leverages a partnership with Sprint for U.S. M2M
connectivity. Orange Business Services offers relatively little in terms of value-added
IT services, as the company maintains no M2M-specific service delivery or in-country
operations personnel.
Telefónica
Telefónica is a global CSP based in Spain. Its M2M business leverages its strong direct
presence in Europe and Latin America, together with its leadership role in the M2M
World Alliance. End-to-end service capabilities are delivered through ecosystem
partners, including SIs, solution providers and device manufacturers. It is also focused
on innovation activities to deliver customer value and differentiation. There have been
prominent deployments by the company in the energy and utility, automotive, and
transportation sectors and smart city initiatives. Gartner estimates that Telefónica

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managed nearly 13 million cellular M2M connections by the end of 2014. Telefónica
maintains the largest installed base predicated on 3G technology, with most in Europe
and Latin America.
STRENGTHS
Telefónica has strong delivery capabilities in Europe and Latin America (including
Brazil, where permanent roaming is not allowed), and it has good language support
(six languages) for customer service and support. Local M2M business units ensure
good responsiveness.
Telefónica's vertically aligned commercial team for marketing and sales activities
enables it to have a good understanding of a broad range of industry verticals and
their associated business challenges.
Telefónica has the ability to act as the prime contractor; it leverages its consulting
services and in-house engineering capabilities to offer customized solutions. There
are also opportunities for customers to co-create solutions and leverage Telefónica's
global innovation network.
CAUTIONS
Some customers cite weakness in Telefónica's program and project management
services. Customers and prospects must work with Telefónica to understand its
processes, methodologies and service-level commitments relating to project and
sourcing management.
With the rapid growth of Telefónica's m2m Global Partner Program (as of July 2014,
more than 250 partners comprising device manufacturers, solution providers and
distributors), customer experience in the short term may be variable.
Telefónica has little direct presence outside Europe and Latin America. While it can
leverage the M2M World Alliance elsewhere, global execution through this alliance
(with standardized and consistent service-level quality and user experience across
multiple partners and regions) is still unproved, because there are as yet no truly large
global M2M deployments.
Verizon
Verizon is a CSP based in the U.S. Verizon's route to market is mainly in the U.S. and
through partners internationally. Moving forward, it is concentrating on vertical solutions
and cross-application enablement to differentiate itself; in addition to helping customers
manage complexity through its professional services offerings. It also has capabilities
obtained through past acquisitions that can be leveraged for managed M2M service

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opportunities. Gartner estimates that by the end of 2014, Verizon managed nearly 14
million cellular M2M connections and devices, with about 2% of those devices residing
outside of North America.
STRENGTHS
Verizon is focused mainly on the service management platform for M2M solutions.
The strategy behind this approach aims to leverage Verizon's own Cloud assets,
Security Services portfolio, M2M Management Center portal, Developer Program and
M2M Application Development Environment that Verizon's partners can use to build
global, sector-specific solutions.
Verizon continues to be the leading smart city provider in the U.S. Using a single
development team dedicated to the task, Verizon offers repeatable solutions that
combine M2M, cloud and security assets for delivery of new smart city technologies.
Additionally, Verizon enables federal, state and local, and municipal organizations to
acquire managed M2M solutions through flexible financing options. Customers in
both the public and private sectors find this advantageous because financing is often
an impediment to solution adoption.
Conversations and reference studies with Verizon's U.S. customers yielded very high
levels of satisfaction with the cellular network reach and performance.
CAUTIONS
Some Verizon customers find that the managed M2M service delivery and support
processes, as well as methodologies, are still immature and require review and
optimization. Additionally, some customers find the communications and interaction
relating to problem management (root cause analysis) to be unnecessarily prolonged.
Verizon is still U.S.-centric regarding its M2M capabilities, and it maintains the least
diverse installed base in this Magic Quadrant. International presence with Verizon,
therefore, includes partnering with other large CSPs and MVNOs, with Verizon
sometimes coordinating these activities under a single contract. Prospects must
push Verizon to demonstrate how it manages global M2M connectivity and contracts.
Some Verizon M2M customers believe that the company is slow to invest, and
productize, innovative and market-leading capabilities.
Vodafone
Vodafone is a global CSP supplying cellular and fixed-network services across multiple
geographies. The company's M2M portfolio is structured as a stand-alone profit-and-
loss center and operates as an independent business unit. The company goes to market
directly to multinational companies. Vodafone successfully services multiple vertical
markets, including automotive, energy and utilities, insurance, public sector,

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transportation, and retail. As of the end of 2014, Gartner estimates that Vodafone
managed nearly 22 million cellular M2M connections and devices, with just over 26% of
those devices residing outside of Europe. Vodafone's major areas of focus for value-
added IT services are technology consulting, device engineering and high-value program
management of third-party access services.
STRENGTHS
Among all the Magic Quadrant participants, Vodafone manages the largest pool of
M2M connections, with a diverse geographic distribution that reflects its global
footprint. Vodafone is also unique in its willingness to manage competitor network
contracts on behalf of the client. This MVNO-like characteristic appeals to large
multinational companies that are just creating their M2M and IoT strategies and wish
to mitigate the risks of dealing with much smaller (in terms of revenue and resources)
MVNOs.
Many Vodafone customers cite that Vodafone's M2M connectivity pricing is the most
compelling in the market today when considering the company's global reach.
Customers are very satisfied with Vodafone's consulting and advisory services related
to M2M connectivity, infrastructure and software.
CAUTIONS
Although Vodafone has made significant investments in its service management
platform, the company is unable to extend broader value through additional hosted
and cloud-based applications. Vodafone's inability to sell cloud-based device and
application management risks its prime vendor role in the market.
Some customers also cite Vodafone's weaknesses relating to business intelligence
and analytics reporting in the customer portal.
Gartner is fielding increasing numbers of client calls from Vodafone partners and user
customers related to concerns around incident and problem management and the
time required to respond to technical issues and crises. Based on our conversations
with customers and partners, emerging market countries, including China, are the
areas of most concerns with technical and account support.
Wyless
Wyless is an M2M service provider based in the U.S., and it provides managed cellular
and fixed-network services across multiple geographies. The company goes to market
directly to multinational companies, and it also partners with many CSPs and SIs.
Wyless serves multiple customers across various vertical markets, including
automotive, energy and utilities, insurance, transportation, and retail. By the end of 2014,
Gartner estimates that Wyless managed 2.6 million cellular M2M connections and

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devices, with more than 26% of those devices residing outside of the U.S. The great
majority of those connections are 2G, with most of the connections based on dual-band
2G/3G devices.
STRENGTHS
Of all MVNOs participating in this Magic Quadrant, Wyless maintains a much higher
percentage of connections through direct contracts with end users (as opposed to
reselling connectivity to partners). This provides Wyless a broader platform upon
which it builds its managed and value-added services.
Wyless is known for its strong focus on customer experience, with quality and
operational performance metrics (such as order to ship, turnaround and response
times) covered by SLAs.
Wyless is still considered the most cost-effective MVNO in the market — with
offerings from simple connectivity to solutions focused on end-to-end functionality.
CAUTIONS
Gartner considers Wyless to be less competitive in Asia/Pacific and the Middle East
and Africa in terms of in-region operational resources and direct sales and marketing.
Wyless is focused on horizontal technologies and connectivity, and its vertical
expertise is less broad and less deep than many of its competitors, limiting the
potential benefits of sector experience.
With about 140 employees dedicated to service delivery and operation, users must
work to understand the distribution of Wyless' resources to scale to support multiple
large global projects.
Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as
markets change. As a result of these adjustments, the mix of vendors in any Magic
Quadrant or MarketScope may change over time. A vendor's appearance in a Magic
Quadrant or MarketScope one year and not the next does not necessarily indicate that
we have changed our opinion of that vendor. It may be a reflection of a change in the
market and, therefore, changed evaluation criteria, or of a change of focus by that
vendor.
Added
No new vendors have been added to this Magic Quadrant.
Dropped
The following vendors were dropped:

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Eseye — The company did not meet Gartner's inclusion criteria for the number of
cellular M2M connections, geographic diversity and revenue for M2M services.
RacoWireless — The company was acquired by Kore in 2014.
Inclusion and Exclusion Criteria

All of the following criteria must be met:
Providers must have at least 500,000 connected devices under management.
Providers must solicit and deliver panregional or global services. Panregional services
require delivery of services to at least two geographies; for example:
Asia/Pacific and Japan

Central and Latin America
Eastern Europe
Middle East and Africa
North America
Western Europe
Providers must recognize at least $10 million in managed M2M related revenue.
Revenue may include bundled connectivity, IT and IT services for M2M solutions.
Providers must offer, directly or through partnerships, life cycle services, including
professional and support services (inclusive of reverse logistics), as a component of
their managed M2M solution (for example, device engineering, consulting and
advisory services, service contract management, device warranty management,
management software/middleware integration, device disposal and recycling, depot
repair, kitting, help desk, and service desk).
Providers must extend to enterprises a portal for accessing data related to monitored
assets/processes; providers must also offer the ability to administer and control
monitored assets.
Providers must complete a Gartner survey relating to capabilities and GTM
approaches.
Providers must maintain infrastructure and systems that add value to the sale/resale
of network services and SIMs. Providers that simply resell network services are not
considered for this Magic Quadrant. These providers are often referred to as "light
MVNOs."

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Evaluation Criteria
Ability to Execute
Gartner evaluates service providers on the basis of the quality and efficacy of the
processes, systems, methods and procedures that enable their performance to be
competitive and that benefit their revenue, retention and reputation. We judge providers
on their ability to capitalize on their vision, their success in doing so, and their global
reach in terms of resources, coverage, seamless delivery within different countries, and
ability to meet clients' requirements.
Ability to Execute is judged by seven main criteria. Each criterion is described below, and
its respective weighting is shown in Table 1.
Product or Service
For this criterion, we review and evaluate each provider's network and IT services
delivery capabilities and the related portfolio offered. We scrutinize service capabilities
from the perspective of companies with global requirements: service definitions that
meet predominant use cases, diverse connectivity offerings, effective resourcing
capabilities (organically and partnered), and account management.
Overall Viability
This criterion includes a best-effort assessment of the overall financial health of the
provider's organization, the success of its M2M communications service business, and
the likelihood that the M2M communications service business unit (if distinct and
separate) will continue investing to support innovation and delivery of the organization's
portfolio of services.
Focused consideration within this analysis included the organization of the relevant
business units, the rate of investment and innovation, and multiyear revenue growth
rates. Additionally, Gartner worked to understand divergent, and possibly dilutive,
strategies within many MVNOs, which are pursuing parallel strategies to become
enabling software providers for competing CSPs and mobile network operators.
Sales Execution/Pricing
For this criterion, we assess each provider's capabilities in presales activities and the
organization that supports them. We consider teams in charge of deal management,
street pricing (based on a Magic Quadrant survey and user feedback), and clarity of
scope.

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Focused consideration within this analysis included users' perception of affordability,
the sales organization to sell value and future-proofed solutions predicated on diverse
connectivity beyond 2G.
Market Responsiveness/Record
For this criterion, we assess each provider's ability to respond, change direction, be
flexible and achieve competitive success as opportunities develop, competitors act,
customers' needs evolve and the market dynamics change.
Focused consideration within this analysis included users' feedback on the provider's
flexibility, continuous improvement and innovation.
Marketing Execution
For this criterion, we assess the clarity, quality, creativity and efficacy of programs
designed to deliver an organization's message to influence the market, promote its
brand and business, increase awareness of its services, and establish a positive
association in the minds of buyers between the company and its services and brands.
Focused consideration within this analysis included users' feedback on the provider's
reinforcement of value to its users and Gartner analysts' perceptions of the provider's
marketing execution.
Customer Experience
For this category, we evaluate reference customers' overall satisfaction with the
services and the provider relationship, taking into account additional Gartner-client
interactions (for example, customer inquiries and one-on-one conversations at events).
We obtained access to reference customers by asking each provider to identify five
reference customers for its managed M2M communications services. We required their
selection of reference customers to observe the geographic distribution needed to
participate in the study and the different industries addressed.
In particular, we consider the important elements of a successful M2M communications

service customer experience. These include overall client satisfaction, value-added
management platforms and services, and continuous improvement processes in place
— both centrally and within the account management team.
Operations
For this category, we assess each provider's ability to meet its goals and commitments,
including contractual service delivery obligations to clients. Factors include the quality
of the organizational structure, skills, experiences, programs, systems and other
vehicles that enable the service provider to operate effectively and efficiently on an
ongoing basis.

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We speak to the service providers about their main procedures (operational, transitional
and relating to program management, relationship management and change
management) and ask their reference customers for feedback about those procedures.
We also ask the providers to supply information about the platforms and services they
provide, the networks they manage, and their partnered access capabilities and
resources.
Focused consideration within this analysis included investments in resources and the
efficiency of the delivery organization.
Table 1. Ability to Execute Evaluation Criteria

Evaluation Criteria Weighting
Product or Service High
Overall Viability Medium
Sales Execution/Pricing High
Market Responsiveness/Record Medium
Marketing Execution Low
Customer Experience High
Operations High
Completeness of Vision
Gartner evaluates service providers on their ability to articulate logical statements
convincingly about the market's current and future direction, innovations, customer
needs and competitive forces, and on how well these correspond to Gartner's position.
Ultimately, we rate providers on their understanding of how they can exploit market
forces to create opportunities for their organizations.
Completeness of Vision is judged using eight main criteria. Each criterion is described
below, and its respective weighting is shown in Table 2.

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Market Understanding
For this criterion, we assess each provider's global view of the managed M2M
communications service market. We evaluate how each provider is working to serve the
main requirements of multinational companies. We also look at the main effect that
new connectivity requirements, delivery platforms and protocol support requirements
are likely to have on each provider's business and offerings in the short term and
medium term.
Focused consideration within this analysis included a review of existing and planned
value-added services, ranging from service management, device management,
application development and management to data management and analytics.
Marketing Strategy
For this criterion, we assess each provider's main marketing messages relating to
managed M2M communications services.
In particular, we consider:
Current and future value propositions for managed M2M communication services
The importance of M2M communications services within the providers' broader
portfolio of business and capabilities
Channels for internal and external communications
The differentiation of a provider's message from its competitors' messages

Sales Strategy
For this category, we require each provider to illustrate its overall sales strategy for
M2M, its reactive answers to RFPs as compared with its proactive activities, its stand-
alone offerings as compared with offerings bundled with other services, and its
dedicated sales force as compared with its general sales force.
In particular, we consider:
The number of dedicated M2M sales personnel globally
Countries covered by direct local teams, as opposed to centralized teams

Client retention rate
Offering (Product) Strategy

For this criterion, we require each provider to specify the most important aspects of the
service offering that differentiates it in the market and delivers value to its clients.
In particular, we consider each provider's:

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Ability to both integrate client requirements and support global business process
flows
Ability to extend value-added IT services to support its clients' global connected
solutions
Approach to combining standard service elements into customized service delivery,

including partnered capabilities, to provide flexible, low-cost and cloud-enabled
service offerings
Business Model
For this criterion, we asked each provider for both a high-level description of its
business model for M2M services and an explanation in terms of how this fits within its
overall business model. To evaluate how well each provider's business model addresses
account management, we asked for information about:
The structure of the management teams used to support and manage customers
Processes to address customer issues locally, as compared with centrally, including
customers' access both to an appropriate level of management within the service
provider and to escalation procedures
We asked each provider's reference customers for their judgment about their provider's
business model, including account management and service delivery, and we factored
their answers into our evaluation.
Vertical/Industry Strategy
For this criterion, we assess each provider's strategy to direct resources, skills and
offerings to meet the specific needs of individual market sectors.
In particular, we consider each service provider's:

Penetration of different industries for managed M2M communications services
Past performance evidence relating to the breadth and depth of sector-specific use
cases based on managed M2M communications services
Innovation
For this criterion, we evaluate each provider's position in the market as a thought leader
and an innovator. We also evaluate how each provider establishes leadership, including
the investment activities to achieve its vision, and how the providers develop innovative
strategies in the M2M market.
In particular, we asked providers to answer the following questions:

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What investments are your company making to sustain and enhance its vision for
innovative M2M services?
What global alliances do you have with other leading suppliers, and what investments
support these alliances?
We also asked reference customers for their judgment of their provider's ability to
innovate (including the technical aspects of innovation), ability to lower costs and to
improve service by delivering innovative utility-based services, and degrees of
responsiveness and proactivity, adaptability, and service flexibility.
Geographic Strategy
For this criterion, we examine each vendor's regional and global capabilities, as well as
local alliances and partnerships, including:
Relationships with product and service providers to add value, provide full-service
solutions or bring innovation closer to clients
How each provider takes responsibility for managing the service delivered, even when
using subcontractors or partners
We also asked reference customers for their feedback about local capabilities and the
current or potential effects of consolidation and global delivery processes.
Table 2. Completeness of Vision Evaluation Criteria
Evaluation Criteria Weighting
Market Understanding High
Marketing Strategy Medium
Sales Strategy High
Offering (Product) Strategy High
Business Model Medium
Vertical/Industry Strategy High
Innovation High
Geographic Strategy High

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Geographic Strategy High
Quadrant Descriptions
Leaders
Leaders believe in the promise of the IoT, and they invest in that future that includes a
continuum of value from edge devices to IoT platforms and related analytics. Leaders
perform skillfully and often exceed expectations. Leaders have a clear vision of the
market's direction and develop competencies to maintain their leadership. They shape
the market, rather than follow it. This year, the Leaders quadrant includes (in
alphabetical order): AT&T, Deutsche Telekom, Telefónica and Vodafone.
Challengers
Challengers execute well today, but they have a view of the market's direction that is not
aligned with the biggest and most demanding customers. They need to be more
aggressive in outlining and communicating their strategy for the future. They must also
be more aggressive in how they invest in innovative offerings and adjacent capabilities.
This year, Verizon is the sole provider in the Challengers quadrant.
Visionaries
Visionaries have a clear view of the market's direction, and they have focus on providing
services to meet future market needs. Visionaries need to improve their ability to deliver
and to expand to penetrate the global managed M2M communications service market.
This year, Orange is the sole provider in the Visionaries quadrant.
Niche Players
Niche Players focus successfully on a particular service, a limited number of regional
markets, or both. This narrow focus may affect their ability to outperform or innovate.
This year, the Niche Players quadrant includes (in alphabetical order): Aeris, Arkessa,
Kore, KPN and Wyless.
Context
As enterprises become more familiar and comfortable with the value and capabilities
associated with digital business, IoT and operational technology (OT), their approaches
to deploying these solutions will need to mature. Today, many of these connected
solutions are planned, deployed and maintained within invisible silos within business
units, such as marketing or operations and engineering.

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It is time for sourcing and vendor management professionals to insert themselves in the
process of solution and vendor selection. This strategy will ensure the cost-
effectiveness and security of these solutions.
This Magic Quadrant assesses the Ability to Execute and Completeness of Vision of 11
managed M2M service providers. CIOs, infrastructure and operations managers and
sourcing managers can use this information and analysis to help them select provider
contracts that support critical functions and business objectives.
Market Overview
Trends in Managed M2M Services
The global economy continues to be fraught with challenges, and building connected
solutions for business growth and/or operational efficiencies often depends on multiple
layers of permissions across pancorporate stakeholders. Users and providers are
engaging within markets that continue to face alternating cycles of recessionary
pressures globally, as well as deflationary concerns in the many mature economies.
Such an operating environment is fine for proofs of concept but are inhibitive for
panregional or global M2M initiatives.
Many large MNCs look to providers to derisk their connected solution investments. Only
a few of the largest, most powerful providers in the M2M market — the CSPs — have
shown a desire to invest in capabilities beyond their core business of mobile data
services. Based on client interactions, global MNCs are looking to consolidate their
vendors relating to connected solutions — a "one-stop shop" predicated on an IoT
platform as a service.
It is because of these pressures from both the demand side and the sell side that
market participants for connected solutions must create strong partnerships, practices
and alliances to help users recognize value faster and without risk.
Cellular M2M Remains a Niche Use Case for IoT Solutions

The market for managed M2M services faces significant headwinds. Currently, the
market-leading provider can count upward of 20 million connections as a dominant
position, while, at the same time, Gartner's forecasts point to the existence of billions of
IoT connections today. In fact, Gartner's current IoT forecast identifies that cellular M2M
connections will represent less than 5% of IoT connections through 2020 (see
"Forecast: Internet of Things, Endpoints and Associated Services, Worldwide, 2014" ).
Gartner's main concern with the market for managed M2M services is the commercial
and GTM models pursued by providers. While there are many technology and financial

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arguments for alternative modes of connectivity beyond cellular, CSPs and managed
service providers (MSPs) must work to push OEMs and ISVs to drive cost reductions
across the M2M value chain.
That said, while the number of M2M connections is low compared with the total number
of connections, the managed M2M service market is likely the most consolidated
revenue pool (in terms of the amount of revenue per provider) in the broader IoT market.
Managed M2M services also remain an attractive margin pool for providers, which
contribute to continued investment in R&D and resources. The 11 vendors in the Magic
Quadrant generate upward of $3 billion in revenue from managed M2M services.
Technology Disruptors in M2M and the IoT

For a long time, the costs associated with cellular M2M connectivity has been a
significant impediment to adoption. The market is seeing more commoditization
pressures on M2M-related hardware. Although Gartner sees stronger discounts for
connectivity services for large MNCs, the cost of connectivity, along with the cost to
manage the various vendors and contracts to manage connectivity, remain problematic
for choosing cellular M2M for their connectivity of choice.
LPWA network technologies are the focus of many end-user and vendor calls. The
promise of very-low-cost hardware, software and services is an appealing possibility.
Vendors such as Huawei and Sigfox, and the LoRa Alliance, continue to generate
significant interest in the market relating to the emerging connectivity technologies.
To date, the hype is much greater than the adoption. Cursory reviews of LPWA solutions
don't necessarily generate the reduced investment costs seemingly buried in the hype,
and capital investments by "would be" providers is relatively modest, with reach being
measured as intracity or intraregion, rather than intercity or interregion.
The technology that is most likely to disrupt markets and cost structures is the
embedded Universal Integrated Circuit Card (eUICC) or embedded SIM. While many
leading providers have adopted embedded M2M form factor (MFF2), such a flexible
solution is not readily available. Once consumer markets are able to leverage the
flexibility and optimization potential of eUICC, that recognition will push many
enterprises to seek eUICC-based solutions. Gartner believes that the eUICC will spawn a
new wave of MVNOs in the M2M market. Global CSPs will focus on large MNCs and
build out broader IoT platforms and services and relegate large portions of the SMB
markets to partner MVNOs.
Encouraging Signs That CSPs Are Transitioning to Broader, and Deeper, Platform-
Centric Models

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In conducting the due diligence for the Magic Quadrant, Gartner is encouraged in the
investments and R&D performed during the past months since the 2014 Magic
Quadrant. CSPs are transitioning their solutions from M2M connectivity — in which SIM
management is the sole value-add — to IoT platforms that span SIMs, modules,
gateways, and device and data management, as well as some level of analytics and
visualization. Additionally, AT&T and Deutsche Telekom each offer their own application
development environments. Clear evidence shows that CSPs and MSPs investing in
platforms that span device to cloud (data management and analytics) are exhibiting
stronger rates of growth and higher margin rates than providers focused on SIM cards
and connectivity.
Partnerships, Joint Ventures, GTM Alliances and Standards

A few functional sales and marketing alliances focus on M2M services and CSPs and
MVNOs. The most noteworthy in this category are the following:
M2M Alliance (http://www.m2m-alliance.com/)
M2M World Alliance (http://www.m2mworldalliance.com/)
Global M2M Association (http://www.globalm2massociation.com/)
The M2M Alliance is a collection of hardware OEMs, middleware ISVs, CSPs and
MVNOs that focus on market enrichment through events and white papers.
The M2M World Alliance is a collection of CSPs — Etisalat, KPN, Telefónica, Telstra,
Singtel, Rogers, Telenor Connexion and NTT Docomo — as is the Global M2M
Association, which includes Deutsche Telekom, Orange Business Services, Telecom
Italia, TeliaSonera, SoftBank and Bell as members. Each of these CSP-centric alliances
seek to act as a meshed partnership for global connectivity and value-added services
for large MNCs.
Also noteworthy is the FreeMove Alliance. FreeMove is an alliance of regional mobile

operators to support multinational companies in their efforts to reduce the complexity
of aggregating and managing mobile services across countries. The alliance brings
together Orange, Deutsche Telekom, Telecom Italia and TeliaSonera. By combining the
coverage and capabilities of its members, FreeMove offers simplified and streamlined
service delivery and ease of contracting.
For providers and users today, perhaps the most important organization that is
dedicated to M2M services is OneM2M (http://www.onem2m.org/) . OneM2M's
membership is composed of 216 OEMs, ISVs, CSPs and MVNOs focused on developing
standard architectures and specifications to enable success in M2M development and
deployment. In January 2015, OneM2M released its first Functional Architecture
(http://www.onem2m.org/images/files/deliverables/TS-0001-Functional_Architecture-

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V1_6_1.pdf) . While the document is dense, and sometimes hard to navigate, the
architecture laid out by OneM2M holds valuable information for both end users and
providers.
Security Remains an Inhibitor to M2M, and Broader IoT, Solutions
Cost reduction continues to be the most cited outcome driving the adoption of M2M
services, as companies look to lower the cost to service and control assets. As more
companies connect more assets and business processes, security will become the No.
1 consideration in the acquisition process. This scrutiny will cascade into reviews of
underlying SDPs, applications and management platforms. For example, Gartner
expects there will be significant investments in the management of private APNs and
VPNs relating to M2M services.
Providers of Managed M2M Services Will Continue to Grow
While the number of providers in this Magic Quadrant diminished from the number in
2014, the market is becoming very competitive from a regional perspective. Regional
CSPs will increasingly lean on alliances and partnerships for global expansion, while a
flourish of MVNOs will be created among SIs, IT and business process outsourcers,
OEMs (for example, automotive and consumer goods), and key market sectors, such as
healthcare, insurance and utilities.
Cellular M2M Services Are Proven Key to Enabling IoT; However, the Market
Appellation Is Losing Favor
Although M2M solutions (telematics) have existed for some time, the increase in
market messaging relating to IoT, OT and digital business forces companies that are
bringing managed M2M services to the market to compete for mind share. That is not
to say that managed M2M services are the functional equivalent of these solution areas;
however, managed M2M services are often an important component and enabler to IoT,
OT and digital business solutions. Gartner expects that during the next 18 months, more
companies will abandon "M2M" as a service category and instead rebrand and relabel
managed M2M services as "managed IoT" solutions.
Common Observations on Buying Centers and Sponsors of Managed M2M Services

Traditional purchasers of IT and communications (such as CIOs and finance-purchasing
executives) are still key stakeholders in the acquisition of managed M2M services.
However, there are emerging stakeholders, such as:
The CEO demanding visibility in high-risk/high-reward initiatives
The CFO hoping to explore unique business models and modes of consumption

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The COO looking to ensure sustain and/or improve levels of performance and
operational efficiency
The chief marketing officer (CMO) looking to open new markets and influence
customer experience
Other emerging stakeholders, including the board of directors, product managers and
supply chain managers, will likely be involved in the approval of business cases, the
specification of requirements and the selection process. Consequently, the sponsors
and buying centers will vary, depending on industry, company size and so forth.
Therefore, service providers may be challenged to gain access to new buying centers
beyond their existing relationships.
Acronym Key and Glossary Terms

APN Access Point Name
B2B2C business-to-business-to-consumer
B2C business-to-consumer
CSP communications service provider
CMO chief marketing officer
eUICC embedded Universal Integrated Circuit Card
GSM Global System for Mobile Communications
GTM go-to-market
HLR Home Location Register
HSS Home Subscriber Server
IoT Internet of Things
ISV independent software vendor
LoRa long-range, low-power
LPWA Low-Power, Wide-Area
LTE Long Term Evolution

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M2M machine-to-machine
MFF2 M2M form factor
MNC multinational corporation
MNO mobile network operator
MRC monthly recurring charge
MSP managed service provider
MVNO mobile virtual network operator
NOC network operation center
PCRF Policy and Charging Rules Function
SDP service delivery platform
SI system integrator
SMB small or midsize business
Evidence
Gartner client inquiries in 2014 and 2015.
Service provider interviews and vendor presentations and demonstrations of software

platforms in 2014 and 2015.
Customer references from the service providers in 2014 and 2015.
Public information from sources such as U.S. Securities and Exchange Commission
filings, press releases, vendor websites and community support forums.
Evaluation Criteria Definitions

Ability to Execute
Product/Service: Core goods and services offered by the vendor for the defined market.
This includes current product/service capabilities, quality, feature sets, skills and so on,
whether offered natively or through OEM agreements/partnerships as defined in the
market definition and detailed in the subcriteria.

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Overall Viability: Viability includes an assessment of the overall organization's financial
health, the financial and practical success of the business unit, and the likelihood that
the individual business unit will continue investing in the product, will continue offering
the product and will advance the state of the art within the organization's portfolio of
products.
Sales Execution/Pricing: The vendor's capabilities in all presales activities and the
structure that supports them. This includes deal management, pricing and negotiation,
presales support, and the overall effectiveness of the sales channel.
Market Responsiveness/Record: Ability to respond, change direction, be flexible and

achieve competitive success as opportunities develop, competitors act, customer
needs evolve and market dynamics change. This criterion also considers the vendor's
history of responsiveness.
Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to
deliver the organization's message to influence the market, promote the brand and
business, increase awareness of the products, and establish a positive identification
with the product/brand and organization in the minds of buyers. This "mind share" can
be driven by a combination of publicity, promotional initiatives, thought leadership, word
of mouth and sales activities.
Customer Experience: Relationships, products and services/programs that enable

clients to be successful with the products evaluated. Specifically, this includes the ways
customers receive technical support or account support. This can also include ancillary
tools, customer support programs (and the quality thereof), availability of user groups,
service-level agreements and so on.
Operations: The ability of the organization to meet its goals and commitments. Factors
include the quality of the organizational structure, including skills, experiences,
programs, systems and other vehicles that enable the organization to operate
effectively and efficiently on an ongoing basis.
Completeness of Vision
Market Understanding: Ability of the vendor to understand buyers' wants and needs and
to translate those into products and services. Vendors that show the highest degree of
vision listen to and understand buyers' wants and needs, and can shape or enhance
those with their added vision.
Marketing Strategy: A clear, differentiated set of messages consistently communicated
throughout the organization and externalized through the website, advertising, customer
programs and positioning statements.

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Sales Strategy: The strategy for selling products that uses the appropriate network of
direct and indirect sales, marketing, service, and communication affiliates that extend
the scope and depth of market reach, skills, expertise, technologies, services and the
customer base.
Offering (Product) Strategy: The vendor's approach to product development and

delivery that emphasizes differentiation, functionality, methodology and feature sets as
they map to current and future requirements.
Business Model: The soundness and logic of the vendor's underlying business
proposition.
Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings
to meet the specific needs of individual market segments, including vertical markets.
Innovation: Direct, related, complementary and synergistic layouts of resources,

expertise or capital for investment, consolidation, defensive or pre-emptive purposes.
Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to
meet the specific needs of geographies outside the "home" or native geography, either
directly or through partners, channels and subsidiaries as appropriate for that
geography and market.
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Magic Quadrant for Managed Machine-to-

https://www.gartner.com/doc/reprints?id=1-2MI3M43&ct=150903&st=sg 29/5/16 19:54

https://www.gartner.com/doc/reprints?id=1-2MI3M43&ct=150903&st=sg 29/5/16 19:54

Program management and ﬁnancial management includes the ability to act as an

https://www.gartner.com/doc/reprints?id=1-2MI3M43&ct=150903&st=sg 29/5/16 19:54

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Source: Gartner (August 2015)

Vendor Strengths and Cautions

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https://www.gartner.com/doc/reprints?id=1-2MI3M43&ct=150903&st=sg 29/5/16 19:54

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https://www.gartner.com/doc/reprints?id=1-2MI3M43&ct=150903&st=sg 29/5/16 19:54

https://www.gartner.com/doc/reprints?id=1-2MI3M43&ct=150903&st=sg 29/5/16 19:54

Orange Business Services' continued investments in technological innovation and

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Conversations with several Orange Business Services customers identify an

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Vendors Added and Dropped

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RacoWireless — The company was acquired by Kore in 2014.

Inclusion and Exclusion Criteria

Asia/Paciﬁc and Japan

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In particular, we consider the important elements of a successful M2M communications

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Table 1. Ability to Execute Evaluation Criteria

Product or Service High

Overall Viability Medium

Sales Execution/Pricing High

Market Responsiveness/Record Medium

Marketing Execution Low

Customer Experience High

Source: Gartner (August 2015)

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The differentiation of a provider's message from its competitors' messages

Countries covered by direct local teams, as opposed to centralized teams

Offering (Product) Strategy

In particular, we consider each provider's:

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Approach to combining standard service elements into customized service delivery,

In particular, we consider each service provider's:

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Market Understanding High

Marketing Strategy Medium

Sales Strategy High

Offering (Product) Strategy High

Business Model Medium

Vertical/Industry Strategy High

Geographic Strategy High

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Source: Gartner (August 2015)