During the last 18 months, the Cellular Machine-to-Machine communication market has been a testing place for cellular embedded module vendors. 2007 was the last ‘good year’ for this market whereas 2008 saw a decline in both shipment volumes and revenue. However with the growing importance of 3G and the unit shipment volume increasing, it is slowly resulting in a stronger performance and a latest study by ABI Research (News - Alert) predicts that the market will be worth $3.8 billion in the year 2015.

In a release, Sam Lucero, the practice director of ABI Research said, “In 2009, the cellular M2M module market grew somewhat in terms of unit shipment volume, although rapidly declining module prices meant that 2009 revenue was still below that of 2007. Despite its difficulties, however, this market is on an upward path.”

The increasing commoditization of an already crowded market are the main reason for these falling ASPs, and the market is further being squeezed by the entry of new vendors, specifically from the Asia-Pacific region. The study says that even with a continuous growth in shipments, the revenue levels for 2010 will be comparatively lower than those of 2007.

The market is seeing some important M&A activity. For example, during the last year, Sierra Wireless acquired Wavecom; and recently, Cinterion (News - Alert) was acquired by Gemalto, a move which, Sam Lucero believes, “is likely to lead to positive results for the company, provided that Gemalto focuses on differentiating the Cinterion market offer with an end-to-end platform.”

This market study is a part of ABI Research’s study named “Cellular Machine-to-Machine (M2M) Markets” which looks into these changing trends, analyzes cellular M2M module vendor strategic responses, offers vendor market share data for the period 2003 - 2009, and also predicts cellular M2M module shipment and revenue growth for the period from 2007 through 2015.

ABI Research is a research firm providing in-depth analysis and quantitative forecasting of trends in global connectivity and other emerging technologies. It was established in 1990, and its offices are spread in North America, Europe and Asia. Through 28 research and advisory services, ABI Research’s worldwide teams of experts advise thousands of decision makers.