M2M-markkinan tilanne ja kehitys pohjolassa - Sonera

Connected Things
The Nordic region is at the forefront of the
Machine-To-Machine revolution

Machine-to-Machine (M2M) communications is about to radically
transform society, industry and the way we live. Managing
complex eco-systems is at the core of successfully developing
and deploying innovative M2M solutions and business models.
The Nordic region, where the number of connected things1
has
already surpassed the region’s total population and is expected to
grow twice as fast as the global market, is at the forefront of the
M2M revolution.
In this report, TeliaSonera and Arthur D. Little have teamed
up to draw hands-on insights from the recent development in
Nordic M2M market. We make three deep-dives into segments
of particular interest in the Nordic context: Connected Vehicle,
Connected People and Connected Building. The report seeks
to inspire people, businesses, and governments to explore the
opportunities that arise when things are connected.
Hans Dahlberg
Vice President
TeliaSonera Global M2M Services
Martin Glaumann
Partner & Head of Telecommunications, Information,
Media and Electronics in the Nordic region
Arthur D. Little
Preface
Martin Glaumann
1. Excluding mobile phones, personal computers and ICT infrastructure

3
During the last five years, M2M has been
one of the hottest topics debated across
industries worldwide. Global industrial leaders
are preaching a revolution more fundamental
than the one created by the internet some 20
years ago. Google’s acquisition of Nest Labs,
a connected home solution provider, in 2014
for USD3.2 billion illustrates how world-leading
innovators are positioning themselves in the
emergent eco-system to capitalize on the
benefits of Connected Things.
M2M solutions have the potential to transform
society, industries and the way we live through
productivity improvements, greater user
convenience, provisioning of value-added
services and enablement of new business
models. Industry experts are outbidding each
other when forecasting the number of global
connected devices. The estimates range from
22 billion (IMS) to 50 billion (Cisco and Ericsson)
by 2020, growing from an estimated 8-10 billion
in 2013.2
In terms of revenue, the global M2M
eco-system is estimated to grow by 16 percent
year-on-year, from a USD300 billion industry
in 2012 to USD980 billion in 2020, according to
Machina Research.3
The Machine-to-Machine
(M2M) revolution has started
When physical objects can communicate with the outside world, they are said to be Connected Things
or Smart objects: one can interact with them remotely, query how they are doing and change their state
as required.
Connected Vehicle includes machines
that transport passengers or cargo, e.g.
e-call, fleet management
Connected People includes humans,
human tissue and/or animals,
e.g. tracking of people´s geographical
positions, measurement of bio markers
Connected Consumer Gadget includes
electronic equipment intended for
entertainment, communications and/or
leisure, e.g. cameras, TVs, white goods
Connected Money includes devices for
payment and related services,
e.g. vending machines, point-of-sale
Connected Building includes physical
structures used as homes, offices or a
public facilities
Connected Industrial Process is defined
as part of a larger commercial process
or procedure, e.g. manufacturing
equipment
Connected Infrastructure includes
physical objects optimized for public
needs or regulatory demands, e.g. Smart
grid, Smart meters
2. IMS, Cisco and Ericsson estimates on the number of devices include mobilde phones, personal computers and ICT infrastrucure as well
as the new industrial and consumer devices defined as Connected Things
3. Including M2M applications, connectivity, value added services and integration, but excluding the connected object itself
What is a Connected Thing?
In this report mobile phones, personal computers, ICT infrastructure are excluded from the definition of
Connected Things and corresponding market data.

4
The M2M revolution is developing in three waves.
In the first wave, M2M enables remotely control-
ling devices such as checking that the front
door is door locked or retrieving the position of
moving objects. In the second wave, when large
amounts of data are collected and processed,
M2M enables new innovative services and
improved productivity. For example, M2M and
Big Data analytics can enable a utility to optimize
thousands of turbines and identify leaks in a water
supply network. On the horizon still is a third wave,
in which M2M solutions are becoming seam-
lessly integrated into the most critical systems of
society; for instance in health care where M2M
enables new advanced remote treatment, or
automation of personal transportation (such as
Google’s driverless car concept).
Despite the market excitement and user benefits, the
reality today is that that the commercial market for
M2M services is fragmented and immature in several
segments. Solution providers are still searching for
sustainable business models and many solutions
are far from mass-market adoption. At present
in Europe, only Connected Vehicles (in particular
tracking and fleet management applications) and
Connected Infrastructure (e.g. Smart meters) can be
considered relatively mature M2M solutions. Fleet
management applications have been commercially
successful due to strong business cases focused
on efficiency improvements for logistics companies
and a relatively structured and clear value chain.
Deployment of Smart meters has been driven by
regulatory requirements in some European mar-
kets, notably Sweden, Finland and Italy.
USD 300
billion
20124
USD 980
billlion20174
4. Machina Research (2013)

5
Successful M2M solutions require several com-
ponents: the connected object itself, services
and integration, and a sustainable business
model that distributes value between players in a
scattered and complex eco-system. To unlock the
growth potential and realize the benefits of M2M,
the interplay between lead users, enablers and
innovators is essential.
Lead users represent early-adopting customers
(consumers or businesses), that are leading the
way in their respective field, such as the farmer
switching to automated harvesting machinery, or
the home-care provider adopting M2M solutions
for patient monitoring at home. Lead users are
creating the necessary demand pull for these
new services.
Enablers are companies that ensure that M2M
solutions can be delivered, installed, served and
billed. Several enablers are likely to be required
for a solution to work. Enablers differ by ap-
plication type and market demands, and can
be represented by telecom operators, platform
providers and system integrators. Enablers are
competing, but also collaborating with each other
to ensure coherent service delivery and quality.
Innovators are companies and entrepreneurs that
develop new M2M applications. The role of the
innovator in the eco-system is to push the applica-
tion boundaries, and sense and explore business
opportunities. Most innovators face difficulties
in reaching lead users by themselves, due to
technical limitations (e.g. integration and delivery
capacity) or lack of market reach.
Two different approaches to unlock the growth
potential in the eco-system can be observed in
the market. On one hand, some companies are at-
tempting to vertically integrate, breach and rapidly
drive growth in a certain connected group or niche
application. By doing so, they can assume control
over the value chain and provide a complete
solution to customers, allowing for quicker time
to market and controlled customer experience.
Google’s acquisition of Nest Labs could be seen
as one example of this approach in the Connected
Building segment.
Other key players in the market are striving to build
horizontal capabilities and platforms, by creating
alliances and partnerships throughout the M2M
eco-system. Through standardization, multiple ap-
plications can be supported on one cloud-based
platform to achieve economies of scale. A key
success factor to drive M2M market adoption is to
have an enabler that takes the main responsibility
for the customer value proposition.
Regulatory, Political, and Economic preconditions
are important for M2M market development.
Regulation and government policy can both limit
and drive the market in a distinct manner. Personal
data integrity policies pose a challenge to the
growth of some application types, such as health
care applications. Many of the more mature M2M
solutions as of today have been pushed by regula-
tory requirements and political agendas, e.g. the
emergency call (e-call) applications driven by the
2015 (EU) e-call mandate for passenger cars and
light-duty vehicles, and the two-way emergency
call applications in elevators pushed by Nordic
legislations in 2012.
Innovating the M2M
eco-system for growth
Politicalenvironment
Economic environment
Regulatoryenvironment
Key roles
in the M2M eco-system
Enablers
Lead users
Innovators

6
The Nordic region is
a hot spot for M2M growth
Despite being a relatively small and remote region,
the Nordics5
have a strong legacy of creating
globally successful and innovative ICT companies.
Ericsson, Nokia, Skype, Linux and Spotify all
have their roots in the region. The Nordic region
has a good infrastructure, a stable regulatory
environment and vibrant user communities.
Conditions for early M2M adoption and
growth are excellent in the region. In 2013,
the number of Connected Things, excluding
mobile phones, personal computers and ICT
infrastructure, is estimated to have reached 28
million, and thus surpass the total population
in the region (26 million). Today, 15 percent of
total mobile subscriptions in the region are M2M
connections, compared with approximately
3 percent globally.6
In 2017, 70 million things
are estimated to be connected in the region,
equaling 2.6 Connected Things per person.
There are two key underlying factors that sup-
port further growth of M2M in the region. Firstly,
ICT infrastructure: The Nordic countries have
among the highest fixed broadband (34%) and
mobile (149%) penetration in Europe. Secondly,
businesses and people are renowned for quickly
adopting new trends and technologies. All four
Nordic economies are within the top ten of the
World Economic Forum’s Networked Readiness
Index (2013) which measures the propensity for
5. The terms ”Nordic countries” / ”Nordics” / “Nordic region” refer to Sweden, Finland, Denmark and Norway
6. Machina Research (2013)
7. Including M2M applications, connectivity, value added services and integration, but excluding the connected object itself
Number
of Connected Things
in the Nordic region6
countries (including their populations) to benefit
from the opportunities offered by information and
communications technology.
The market size for M2M solutions in the Nordics
was estimated at EUR1.7 billion in 2012. Thirty per-
cent year-on-year growth is forecasted until 2017,
roughly twice as fast as the global market, reach-
ing a market size of EUR6.1 billion. Despite small
differences in market characteristics between the
four Nordic economies, some differences can be
observed in market size, maturity and growth:
• Sweden is the largest market (EUR515 million),
and is estimated to grow by 32 percent year-
on-year, reaching a market size of EUR2 billion
in 2017.
• Finland is the most mature market, with 1.22
Connected Things per person and a total esti-
mated market size of EUR396 million in 2012.
The high penetration rate is consistent with the
high mobile penetration rate (169 percent) and
early deployment of Smart meters. Growth rate
is expected to be slightly lower (27 percent year-
on-year) compared with the region as whole,
reaching a market size of EUR1.3 billion in 2017.
• Norway, with 1.03 Connected Things per
person, is relatively immature compared with
the region’s other countries. The market is
expected to grow by 29 percent year-on-year,
from EUR387 million to 1.4 billion in 2017, partly
driven by Smart meter deployment in 2014.
• Denmark’s market size is estimated at EUR379
in 2012, and is expected to grow by 29 percent
year-on-year, reaching a market size of EUR1.4
billion in 2017.
The market characteristics differ more by
Connected Group than by country. In 2012, the
largest connected group in the Nordic region was
Connected Building (EUR568 million), including
both M2M solutions within homes and offices.
Security applications are the leading and most ma-
ture application types in the group. The segment
is expected to grow by 13 percent year-on-year,
reaching EUR1,050 million in 2017.
Connected Consumer Gadget (EUR457 million)
was the second-largest segment in 2012, and is
expected to grow by 42 percent year-on-year,
reaching EUR2.6 billion, the largest segment in
2017. Growth is driven by the myriad consumer
Norway Sweden Finland
Denmark
4m
2013
15m
2017
6m
2013
16m
2017
9m
2013
23m
2017
5m
2013
16m
2017

7
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
201720162015201420132012
1,677
2,094
2,664
3,453
4,554
6,099
EURm
Vehicle
46 %
People
47 %
Consumer
Gadget
42 %
Money
11 %
Building
13 %
Industrial
Process
11 %
devices (e.g. cameras, consumer wearables,
white goods, music players and TVs) that are
being connected.
Connected Infrastructure (EUR279 million), which
includes Smart meters deployed in Sweden and
Finland, has been a key driver for growth in M2M
mobile subscriptions in the region. In terms of
revenue per device, this segment is likely to face
further price pressure, in particular on connectivity
services of installed Smart meters. The segment
reaching EUR323 million in 2017.
Connected Vehicle is expected to show 47 percent
growth year-on-year, the strongest growth rate
driven by solid uptake in the number of connected
cars, which will not only be pushed by OEMs, but
also other stakeholders, such as repair shops,
insurers, rental providers and car pool service
providers. In Norway, an electric car subsidy is
expected to drive the number of new connected
cars, and in Finland, there is an estimated rapid
uptake of “Pay as you drive” insurance policies
connecting not only new but also aged cars. The
segment is expected to grow from EUR196 million
in 2012 to EUR1,321 million in 2017.
Connected People (EUR88 million), with health
care-related applications such as remote measure-
ment of bio-markers, is yet a small and immature
segment, but with immense growth opportunities.
It is expected to grow by 47 percent year-on-year,
Connected Industrial Process (EUR51 million) is a
rather relatively small segment in terms of M2M
solutions. The segment is driven by underlying
industry demand to improve productivity and com-
petiveness, but faces some challenges that limit
growth, such as high integration costs and long
asset lifetime of industrial equipment. The segment
Connected Money (EUR38 million) is a relatively
small segment, but includes some mature ap-
plications such as point-of-sale terminals. In some
countries, such as Sweden, growth has been
driven by regulations requiring restaurant owners
to exercise the credit card payment process at
customers’ tables. Other application types, such
as connected vending machines or parking meters,
are yet immature in the Nordic region. The segment
In the next section, we explore the largest
(Connected Building) and the two fastest-growing
(Connected People and Connected Vehicle) groups
in the Nordic region, to highlight how M2M is
transforming society, industry and the way we live.
Source: Arthur D. Little analysis, Machina Research * Compound Annual Growth Rate
30%
(CAGR*)
2012–2017
CAGR*
Infrastructure
3 %
396
Finland
2012
1,290Finland
2017
Market size and growth
379
Denmark
2012
1,374Denmark
2017
387
Norway
2012
1,402Norway
2017
515
Sweden
2012
2,034Sweden
2017

8
Key application types
Sweden
531,000
Norway
340,000
Finland
314,000
Denmark
318,000
0
300
600
900
1,200
1,500
201720162015201420132012
196
327
571
867
1,092
1,321
Per country
1.5 million Connected Things†
Segment size
Security tracking
Financing insurance
Navigation information
Vehicle diagnostics
Fleet management
Entertainment
convenience
With Sweden, Norway and
Finland having a population
density of less than 20 inhabit-
ants per km2
(compared with the
European Union average of 112
inhabitants per km2
), combined
with cold and long winters, geographic distance
and harsh environments, mobility is an everyday
challenge. The average Finn travels more than 46
km per day, compared with 36 km per day for the
average German8
. Moreover, the Swedish govern-
ment has been pursuing a “Nollvision” (vision of
zero traffic fatalities) policy since 1997. These are
all strong local drivers for developing smarter and
safer cars in the Nordics, with improved comfort
while on the road, as well as high security to cope
with demanding weather conditions. Innovative
solutions were developed early driven by a strong
automotive cluster, including Volvo and Scania.
An estimated 45 percent of all vehicles (pas-
senger and commercial) or 8.3 million vehicles,
in the Nordic market will be connected by 2017,
up from 9 percent today.9
The market for M2M
solutions, within the Connected Vehicle segment,
is estimated to grow by 46 percent year-on-year
until 2017, from EUR196 million in 2012 to EUR1.3
billion in 2017.
The growth is expected to be driven by increasing
consumer demands, OEMs economics, regulatory
requirements and other eco-system innovators.
First, lead users, now used to smartphone
features, are increasingly expecting similar
sophistication and simplicity in vehicle interfaces.
Connected
Vehicles
In 2017, 45 percent of Nordic vehicles (passenger and commercial) will
be connected enabling safer, greener and more reliable vehicles with
improved driver experience
8. Eurostat
9. Some Connected Vehicles include more than one connected device
What is a Connected Vehicle? A single machine or fleet
of machines that transports passengers or cargo with
a special connected platform that enables a wide array
of solutions. The driver of a single vehicle can access
navigation systems, entertainment systems, and e-call/
emergency notification, and use security applications such
as stolen-vehicle location. Fleet owners can manage their
fleets of vehicles, access remote diagnostics of engines
and manufacturer data.
46%
(CAGR*)
Source: Arthur D. Little analysis, Machina Research * Compound Annual Growth Rate † 2012
EURm

9
In September 2013, Tesla Model S was Norway´s
top-selling car, all categories, partly driven by a
government subsidy on electric cars. As a pioneer
in high-performance electric vehicles, Tesla has
spearheaded implementation of innovative M2M
features for connected services. With the Model S,
M2M-enabled features include vehicle diagnostics,
internet radio, and web browsing, which are
accessed through a touchscreen. Moreover, using
M2M technology, the driver’s experience can be
continually improved through remote software up-
grades. Tesla’s Model S illustrates how connected
cars provide an improved driving experience and
can be more cost efficient with smart maintenance.
Use case: Next generation driving experience
The typical car insurance customer is assigned
a premium based on so-called risk factors such
as postal code, gender, age and vehicle type (in
addition to the customer’s own past record). Using
M2M technology insurance brokers can provide
user-based insurance that gives drivers control
over their own insurance policies by monitoring
driving behavior to allocate premiums based on
actual habits. The insurance premium can be
determined, in real-time, by driving patterns, such
as speeding, sharp braking and parking locations.
Governments are also exploring the opportunities
for “Pay as you drive”; in Finland, the Finnish
Transport Agency is investigating the use of M2M
solutions for tax collection on vehicles based on
driving patterns.
Use case: User based insurance “Pay as you drive”
Second, automotive manufacturers (OEMs) seek
to meet the consumer demand with connected
features to defend premium price points. They
also seek to leverage M2M, for example, for failure
code predictions and vehicle recall mitigation
and after-sales opportunities. Third, legislation is
driving innovation through e-call applications with
several mandates promoting embedded solutions,
e.g. the 2015 (EU) e-call mandate for passenger
cars and light-duty vehicles. Other eco-system in-
novators such as insurers, repair shops, car rental
providers and car pools will push new services into
the market targeting mainly the existing non-
connected fleet, namely passenger cars older than
3–5 years. Repair shops, for example, have a lot to
gain to be able to redirect cars to their own repair
shop and do pre-emptive maintenance.
Key benefits of Connected Vehicles
include:
1. Improved safety, security, navigation and
entertainment (e.g. traffic condition information,
weather and hazard alerts, and p2p alerts on
speed camera locations)
2. Preemptive maintenance through remote
vehicle performance
3. User-based insurance, where actual driving
performance is used to determine insurance
premiums. 7 out of 10 drivers could save up to
15 percent of their insurance premiums.11
10. Arthur D. Little analysis, Machina Research (2013)
11. Insurance Journal (2013)
45percentage connected
vehicles by 201710
percentage
connected vehicles
today10
9

10
268 000 Connected Things†
Segment size
Sweden
104,000
Norway
54,000
Finland
60,000
Denmark
50,000
Every day approximately 40
people in the Nordics suffer
strokes due to undiagnosed or
untreated heart diseases. Every
year approximately 300,000
people are diagnosed with
Alzheimer’s Disease; some 60 percent of them
wander away from their caregivers or homes.12
These are only two of many issues that not only
generate great suffering for humans but also cost
the health care system many billions of euros every
year. At the same time, demographics are shifting,
with more than 25% of Swedes expected to be
aged over 65 in 2030, creating high pressure on
the welfare system. Innovative M2M applications
and services are expected to become an essential
part of providing security and patient care, helping
to save lives and cut costs.
The market for M2M solutions, within the
Connected People segment, is estimated to
grow by 47 percent year-on-year until 2017,
from EUR88 million in 2012 to EUR600 million in
2017. The strong growth is driven by underlying
demand from a growing and aging population
with increased demand for high living standards
at their homes. Governments and private health-
care providers are squeezed between these
higher demands and needs for cost savings on
State healthcare budgets. The market is still in a
trial-and-error stage in which new solutions are
pushed into the market by innovators such as
Connected
People
M2M has the potential to reduce 50 percent of hospital nights and re-
hospitalization of certain patient groups and significantly improve quality
of life for patients and the elderly.
What is Connected People? A human, human tissue
and/or animal that is connected, enabling tracking of
geographical positions or access measurement data
of bio markers. By connecting People a wide array
of solutions could be offered, such as clinical remote
monitoring, first responder connectivity, telemedicine
and personal monitoring.
0
300
600
900
1,200
1,500
201720162015201420132012
88
129
190
278
409
600
EURm
47%
(CAGR*)
Per country
12. Alzheimer’s Association
Health tracking monitoring
Telemedicine remote
diagnostics
First responder connectivity
People tracking

11
By means of early detection and treatment of
fibrillation, a large number of strokes can be pre-
vented. Zenicor, a Swedish med-tech pioneer, has
developed a small and portable ECG-monitoring
device that can be used by all patients, including
children and the elderly. Measurement begins
when the patient puts his/her thumbs on the
electrodes. Microvolt ECG signals are measured,
stored and transferred. The device consists of,
among other things, a display, two measuring
electrodes, and a built-in cellular connectivity
device, allowing for real-time monitoring.
Use case: ECG monitoring at home
Monitoring a person in real time can save both
lives and precious public resources. There are
many instances in which tracking an individual is a
necessary safety measure, such as with patients,
children and prisoners on parole. Tracking devices
can come as small, wearable devices that often
blend in and are virtually unnoticeable to a pas-
serby. For instance, child-tracking devices often
look like small wrist-watches. Leveraging wireless
cellular M2M technology, these devices can often
locate a missing person regardless of whether they
are inside a building or under a structure.
Use case: People tracking
large medical suppliers or venture capital-backed
start-ups. Creating partnership within the industry
eco-system, integration into existing health-care
systems and mastering local and often rigid public
procurement processes are key success factors
for developing successful M2M solutions in
the segment.
Key benefits of Connected People
include:
1. Significantly improve the quality of life of an
aging population by providing health care at
home and adoption of more patient groups as
candidates for home care
2. Generate up to 50 percent reduction in hospital
nights and re-hospitalization of patients with
chronic diseases such as cardiac disease, high
blood pressure, diabetes and obesity13
3. Reduce costs to health-care, elderly care and
penitentiary institutions by up to 20 percent13
4. Contribute to a more secure society by cost-
efficient tracking and monitoring of people
(e.g. patients, children, prisoners) and pets
50%reduction of hospital nights and
re-hospitalization within certain
patient groups13
20%cost reduction potential at
health-care, elderly care
and penitentiary
institutions13
13. Arthur D. Little analysis, University of Oxford
Up to

12
6 million Connected Things†
0
300
600
900
1,200
1,500
201720162015201420132012
568
642
726
821
929
1,050
13%
(CAGR*)
In the Nordics, electric-
ity consumption per capita is
16.4 kWh, more than double the
European average of 7.5 kWh.
In this cold climate, heating of
buildings is the key contributor
to this difference. Saving on energy is critical for
both protecting the environment and enabling
cost savings for home owners and commercial
investors. New homes and offices that are being
built are intelligent, such as the Stockholm Royal
Seaport, a landmark project in Stockholm. Utilizing
climate-smart and efficient infrastructure, the city
of Stockholm is planning to build a climate-positive
city district by 2030. Some 10,000 homes and
30,000 workspaces will be connected. When
homes and offices are being connected, other
features can easily be added, such as home
automation and improved security.
The market for M2M solutions, within the
Connected Building segment, is estimated to
grow by 13 percent year-on-year until 2017, from
EUR568 million in 2012 to EUR1,050 million in
2017. Connected Building corresponds to one third
of the entire market and is one of the more mature
segments. In particular, security applications have
been commercialized for some time by security
Connected
Building
M2M can support up to 30 percent energy savings in homes and offices
and provide increased convenience and security to home owners and
commercial developers
What is a Connected Building? A home or office
equipped with a special connected platform enabling
its occupants to remotely control and program an array
of automated connected devices. When the home or
office becomes Smart, it offers a wide array of new
applications, such as security, automation, optimization
of HVAC (Heating, Ventilation and Air Conditioning), and
connected office appliances.
Sweden
1.9 m
Norway
1.3 m
Finland
1.4 m
Denmark
1.4 m
Per country
Segment size
EURm
Home/office security
Connected Office appliances
Building automation
Energy optimization

13
Using M2M technology, heating, ventilation, and
air conditioning (HVAC) can be controlled to auto-
matically adjust for maximum energy savings and
indoor climate comfort. This reduces peak loads
and provides a more stable grid. These systems
can be used to both optimize and verify the energy
savings achieved by the heating/cooling control
across devices. For example, ATC’s Scypho
solution, deployed in several Nordic countries, is
a hub for Connected Things in the building. It uses
ultra-low-power radio communication via standard
radio protocols for metering devices, temperature,
air quality and humidity sensors, actuators for
radiator control, motion, presence and window
detection sensors (security alarms).
Use case: Energy optimization in homes and offices
Over one million apartments were built between
1965 and 1975 in Sweden and the plumbing in
these homes is in serious need of replacement.
These large quantities of reparation and mainte-
nance issues have several practical implications.
A problem of door-key management for such
projects can be easily solved using an M2M
motorized keyless handle. Installation takes just a
few minutes, does not cause damage to or leave
any marks on the door since neither the lock
engine nor the cylinder need to be replaced. The
apartment door and lock continue to work normally
for tenants coming in and out using their own keys.
Meanwhile, an authorized workman can access
the apartment with a digital key consisting of the
workman’s own identification tag with an RFID bar-
code on it. Access can be monitored remotely, and
when work is over, the handle is removed without
any damage, providing safety, accountability and
ease of use for all parties.
Use case: Access control
companies that have developed M2M technology
to improve productivity in a traditionally personnel
intense industry. In addition, home automation ap-
plications have been on the market for some time;
however, not until lately has functionality improved
and prices have been sufficiently reduced for
mass-market adoption to occur. Demand is driven
by a need for security and convenience of auto-
mated homes, while energy management empha-
sizes cost savings and environmental factors.
Key benefits of Connected Building
include:
1. New automated services in homes and offices,
e.g. automated lighting, remote door looking
2. Improved security for home owners e.g. home
alarms, connected smoke detectors
3. Energy savings of up to 30 percent in homes
and offices due to optimization of HVAC
(Heating, Ventilation and Air Conditioning)14
14. Arthur D. Little analysis, ATC (2014)
EUR1 bnsegment size
in 2017
30%energy savings in homes
and offices14
Up to

14
Machine-to-machine (M2M) communications
is transforming society, industry and the way we
live. Myriad things are now being connected, from
remote ECG-monitoring devices to traffic control.
Industry experts expect the number of connected
devices to reach from 22 to 50 billion globally by
2020. Today’s reality, however, is that the commer-
cial market for M2M solutions is fragmented and
immature in several segments. Solution providers
are still searching for sustainable business models,
and many solutions are far from reaching mass-
market adoption.
To overcome these challenges, the interplay
within the M2M eco-system between lead users,
enablers and innovators is essential. Prominent
M2M players are striving to vertically integrate to
drive rapid uptake in a certain segment, and/or to
build horizontal capabilities by creating alliances
and partnerships. A key success factor to drive
M2M market adoption is to have an enabler that
takes the main responsibility for the customer
value proposition.
The right conditions for early M2M adoption and
further growth can be found in the Nordic region,
which has an excellent ICT infrastructure, a stable
regulatory environment and lead users, enablers
and innovators.
• The Nordic M2M market is expected to grow
by 30 percent year-on-year until 2017, roughly
twice as fast as the global market, reaching a
market size of EUR6.1 billion.
• In 2013, the number of Connected Things
surpassed the region’s total population. By
2017, there will be an estimated 2.6 Connected
Things per person.
There are several examples of how M2M has
started to transform society, industry and the
way people live in the Nordics. In the Connected
Vehicle segment, M2M solutions will revolution-
ize the driver experience, enhance security and
enable new business models to thrive, e.g. “Pay
as you drive”, intelligent car pools and preemptive
vehicle maintenance. An estimated 45 percent
of all vehicles (passenger and commercial) in
the region will be connected by 2017. In the
Connected People segment, M2M solutions
could reduce up to 50 percent in hospital nights
and re-hospitalization for patients with chronic
diseases and significantly improve quality of life for
patients and the elderly. Innovative M2M solutions
are also becoming integral for Connected Building,
for example, by offering the potential for up to 30
percent energy savings in homes and offices and
providing increased convenience and security to
homeowners and commercial developers.
In summary, the Nordic region is at the forefront
of the M2M revolution. Decision makers should
watch the Nordic markets closely and embrace the
opportunity to engage in a pioneering eco-system.
Conclusions

TeliaSonera provides network access and
telecommunication services in the Nordic and Baltic
countries, the emerging markets of Eurasia, including
Russia and Turkey, and in Spain. TeliaSonera Global
M2M Services is a global unit in the TeliaSonera
group and a founding operator of the Global M2M
Association, responsible for business-critical M2M
solutions. With extensive mobile networks across
its markets, dedicated M2M services, including
technology and support, as well as an expert network
of industry and operator partners, TeliaSonera
deliver comprehensive M2M Solutions with seamless
quality throughout Europe. TeliaSonera believes
M2M has the power to transform the way companies
do business as well as how people live their lives.
Read more on www.teliasonera.com/m2m
About TeliaSonera Global M2M Services
Arthur D. Little, founded in 1886, is a global leader
in management consultancy, linking strategy,
innovation and technology with deep industry
knowledge. We offer our clients sustainable
solutions to their most complex business
problems. Arthur D. Little has a collaborative
client engagement style, exceptional people and a
firm-wide commitment to quality and integrity. The
firm has over 30 offices worldwide. Arthur D. Little is
proud to serve many of the Fortune 100 companies
globally, in addition to many other leading firms and
public sector organizations.
About Arthur D. Little
Authors: Hans Dahlberg, Johan Öberg,
Martin Glaumann, Hampus Dahlstedt,
Andreas Gjelstrup Björdal

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