M2M APPS: Could you set the Telenor Connexion stage? What is the relationship with Telenor, Norway's incumbent operator? And why are you located in Sweden?
GWENN LARSSON: That’s an easy question to answer. Around 12 or 13 years ago Telenor started working in Sweden, primarily to serve Volvo, who were implementing fleet management and eCall solutions, and Securitas Direct, who were doing security alarms. After working in the M2M industry for several years the Telenor Group decided in 2008 to form a separate company, Telenor Connexion, and it made sense to keep the activity in Sweden because that is where the M2M team was located.
M2M APPS: That was a game-changing move for a Tier 1 Telco.
GWENN LARSSON: It was. We think that was the first time that a major Mobile Network Operator created a separate organization with its own P and L and being in another country also meant that we were operating at arm’s length. In addition Telenor established another operation, Telenor Objects, around that time. Their focus is on a data management platform for M2M applications.
M2M APPS: Why did you find it necessary to develop your own platform and why did you decide to sell it to Ericsson a few years later?
GWENN LARSSON: We decided early on that we needed to build our own connectivity platform. To be honest there was an obvious need for a dedicated platform because the maintenance update windows, the length and frequency that a mobile operator needs are significantly different to those of an M2M solution provider. Service providers and solution providers are different industries: they’re fundamentally different, which means that one platform can’t address both requirements. We built our own platform between 2008 and 2009 and subsequently we sold it to Ericsson in 2011. That was a big surprise to many people in the industry and it was misunderstood in some areas, the press for example, but it was clear to us once we had built the platform we needed and operated it for some time, that it would be better to sell it to a company like Ericsson that had the resources that would be needed to develop new features and functionality and to scale it for wider use. In that way the platform could become a de facto standard for use within the industry. We didn’t see platform development as being a core Telenor Connexion competence, but of course we continue to employ it, we’re Ericsson’s biggest customer, and as a partner we are constantly discussing the direction the industry is taking and the new functionality that will be needed in future.
M2M APPS: Telenor Connexion has enjoyed considerable success in the M2M space. What is your focus right now?
GWENN LARSSON: Our focus at the moment hasn’t changed very much in the last three years. We’re working closely with OEMs, device manufacturers, and tier one playersthat are looking to implement a business or life-critical M2M application. This is why we have customers such as Daimler, Nissan, Renault, Scania and Volvo who are implementing automotive applications, or Securitas Direct, whose solutions generate alarms that have to be delivered immediately. The same criteria apply to telematics and eHealth and of course there are other vertical industries where M2M applications are business critical. I’d like to emphasize the importance of home security because it’s a good example of a vertical industry where our experience has come into play. Development engineers in the wireless security industry need to ensure that they are aware of potential connectivity issues and take the requisite steps. If they don’t they might find out that a network disruption has a significant impact on their alarm service. If signals are not sent immediately then lives can be lost. Therefore it is important for developers to work closely with an experienced M2M connectivity provider such as Telenor Connexion.
M2M APPS: What support do you give to the developers?
GWENN LARSSON: Support shouldn’t be something you add to your offer. We believe that it should be an integral component of any business or life critical application and it should also encompass the years of experience, over a decade, that Telenor Connexion has logged in automotive telematics and security systems. In addition it should be proactive. In order to provide that kind of support, and by the way it has to be operational 24/7, our service team is staffed by techies. I’m tempted to call them nerds, but whatever we call them it works. I think this approach to M2M is unique within the industry.
M2M APPS: What do you see as the industry’s biggest challenge on the marketing front at the moment?
GWENN LARSSON: Unfortunately there is a general impression that wireless networks are nothing more than bit pipes and that price per Mbyte, not quality of service and the total cost of ownership for that service are the key parameters. We are even working with our competitors to change that mindset in order to ensure that M2M connectivity is not undervalued. It is easy to get carried away with growth predictions and they are staggering, but connectivity services are more complex than many people think and they can be and should be rich and robust. We don’t see price per Mbyte as an issue: around 98% of M2M applications use less than 2Mbyte a month. Another challenge is to get companies to understand that they don’t have to go to the operator that owns the network in the country in which they are located. In most cases they are better off going to a global player that has a good M2M track record.
M2M APPS: A final question: it’s generic. What’s your take on the way that M2M is going to impact on our lives in 2012?
GWENN LARSSON: I think that what we are going to discover in the coming months and even further out is that a lot more information is going to be pushed at us: information that is related to almost everything we do. Some good examples are telematics in cars that provide information on driving behavior to insurance companies. That way the premium young drivers pay can be based on accurate information instead of age. It’s a classical win:win app. Smart energy meters are going to tell us how much energy we are using and what it costs. And security systems will do more than merely issue a break-in alarm. For example, they’ll tell us when our kids are at home or not at home.