Erik Brenneis: The aim to provide integrated solutions, not
access to the network. Our vision is that we want to be the
market leaders. As the biggest global operator we have a lot
Machine-to-machine services are creating huge enthusiasm in the
telecoms industry - but Vodafone's Erik Brenneis seems at times
to be an executive for whom they are a personal campaign.
He's been working in the area for 12 years, since before most
people in telecoms had any idea of the meaning of the terms M2M
or machine-to-machine, working for two pioneering companies in
the area - first meter company Landis and Gyr and then Siemens
and its spin-off, Cinterion.
"I've picked up a little bit of knowledge over those 12 years,"
says Brenneis, a German who clearly has also picked up the
British art of understatement. "That's why Vodafone hired me,
to build a market. I had the market knowledge."
He joined Vodafone in October 2009 as head of its worldwide
machine-to-machine business. He commutes from his home in
Munich to Vodafone's main corporate offices in the UK, both
Newbury and London.
"Three years ago Vodafone and the other mobile operators didn't
have an M2M strategy," he says.
But there was already an identified demand - particularly from
electricity companies that were developing smart metering
systems. "Power companies would buy SIM cards to read out data
but there wasn't a dedicated machine-to-machine solution."
Vodafone, like many other operators, was providing services to
these early M2M users from within the corporate teams of its
many national branches worldwide.
"When I came to the company we decided to create a central line
of business, with all of the machine-to-machine specialists
from around the world gathered into one team."
More than that, Vodafone went outside the group to hire
specialists from all the many sectors that it expected to be
wanting machine-to-machine services as the industry developed.
"We went out and hired people from utilities, the automotive
industry, consumer electronics and so on to build the market,
to develop our own machine-to-machine service."
The unit that Brenneis heads was kept deliberately separate
from all of Vodafone's national units. "We built our own
software platform and our own billing platform," he recalls.
That's because the future users of machine-to-machine services
will want treating very differently from the regular consumers.
"If a utility has one million electricity meters it will want
one bill for all million meters, not a million bills," smiles
And the system can be programmed with what to expect from each
in terms of the service to be billed for. A consumer may use
many hundreds of megabytes of data. "If a meter consumes more
than megabyte we want an alarm. We can set thresholds."
There's another reason for putting this machine-to-machine unit
into a central division of the group.
A Vodafone consumer in Italy, New Zealand or India will go into
their local store to sign up - and after that they're
reasonably likely to spend most of their time in that country.
But a company that makes cars, cameras, washing machines or
meters will make them in a limited number of factories. It
won't know definitely where they will end up, yet it will want
to load up a SIM card into each machine-to-machine unit so that
it can be shipped off for sale and use.
"We build our solutions around a global SIM, not national
SIMs," says Brenneis. "A car manufacturer doesn't know where
each of the cars will ultimately go. You need a global SIM.
Otherwise you have to specify where it goes - France, Germany
and so on.
"And these are industrialised SIMs that will work over a wide
temperature range. The SIM in your phone is built on a strip of
plastic. Industrialised SIMs are soldered into the car at the
point of production. It needs to work for seven, eight, nine
It may be soldered into the device, but it does have a real
phone number, he adds. "Sometimes you have to call. For example
it may be in an elevator, and when you're stuck you press a
button and a connection is opened."
The SIM will automatically register with the local Vodafone
company in which the unit is first turned on. "If it's in
Germany, it will register with Vodafone Germany - and that has
the ability to be able to monitor it."
If there isn't a Vodafone company, it will pick a company that
Vodafone has an agreement with: SFR in France, for example, or
Swisscom in Switzerland. "We have special roaming agreements
and we have agreed special prices."
Those special deals are important, because machine-to-machine
services will not in general generate vast amounts of
revenue-earning data. But sometimes no data at all.
"Let me give you an example," says Brenneis. There are Vodafone
SIMs in intrusion and fire detectors installed by security
companies. "In a perfect world nothing happens and you will
never generate traffic. There will be no fire, no break-in. So
we agree a service fee that is not based on usage but on
And that brings us to an extra point. A global SIM will roam
just like a SIM in a mobile phone that is taken across a
border, but with an extra advantage: it will roam in its
country of registration too, if there is no suitable Vodafone
signal. So that intrusion detector should still work even if
the local Vodafone base station has a glitch.
"We compete with Telefónica but our global SIMs will
roam onto a Telefónica service if there isn't a Vodafone
Brenneis's group is scattered around the world, in places such
the UK, Italy, Spain, Germany, New Zealand and South Africa.
"There are more than 200 dedicated M2M specialists reporting in
to my team around the world."
The team has members in the US and Japan. "We don't have our
own network there, but we do have potential customers," he
says. Vodafone Japan was sold to SoftBank in 2005, and though
the group has a minority, though substantial, interest in
Verizon Wireless in the US it is a CDMA shop so, until LTE
becomes a vehicle for M2M, Vodafone's SIMs won't work on that
"If you have huge customers like Amazon or Toyota which need a
global M2M solution they need our engineers working with them
in those countries," he adds. So more than "potential
Amazon has a contract with Vodafone to connect Kindles sold in
most of the world. AT&T has the deal for the US, and
Vodafone looks after the rest. (Brenneis didn't say it, but for
the first Kindle models Amazon used Sprint - another CDMA
house, rendering early acquirers unable to upload new books
once they were outside US borders.)
"Today we are market leaders. That was our vision to get there.
As the biggest global operator we have a lot of strengths."
The aim, he repeats, is "to provide integrated solutions, not
just access to the network. Our vision is that we want to be
the market leaders."
The focus is still on growing Vodafone's revenues as an M2M
service provider, not just a retailer of data capacity. In
addition to Amazon, the company has a strong position with the
energy company Centrica - which trades in the UK as British
Gas, though it provides electricity as well as natural gas -
and with German carmaker BMW. "We use our position to sell more
to those customers than just connectivity," he adds.
British Gas is planning to use Vodafone modules in more than a
million electricity meters across the UK, he notes. "The
European Union has set a target of 2020 for 80% of all
electricity meters to be able to be read automatically, though
it is up to each member country how to implement that. There is
a UK national smart metering project."
One of the next big projects for M2M is for modules for ice
cream cabinets and drinks coolers in local stores, he notes.
They will be used to monitor the stock levels, the temperature
and other parameters - including location, he adds.
One of the famous drinks companies - Brenneis won't say which -
found that a shopkeeper somewhere in eastern Europe took his
company-supplied cooler home every night for his own personal
use, leaving the cans to warm up in the store.
"So in future the company will know if the shopkeeper switches
off the energy to move it. And it will be able to check the
cooler's location." As well as more mundane matters such as
stock levels, no doubt.
Brenneis's team is working closely on this project with
Zelitron, a machine-to-machine software specialist based in
Athens that is part of the Vodafone group.
"Zelitron develops the software to read all the connections and
provide meaningful results," he says. It means that Vodafone
can sell end-to-end solutions that are more than just network
connectivity. "And that means we increase our revenues."
Where else will M2M modules appear? After electricity meters,
gas and water will follow, he adds.
Navigation systems already use M2M: "TomTom is one of our
biggest customers." Vodafone can judge the speed of the traffic
from anonymised signals coming from the TomTom GPS devices, and
that means TomTom can deliver congestion information back to
those in-car navigation systems.
"I can see connected cameras," says Brenneis. And makers of
washing machines and dishwashers are looking at M2M too. Not
just to upload fault diagnoses to a central monitoring station
so that a service engineer can bring along a spare part on the
first visit, but because they're thinking about a pay-per-wash
"There are already big industrial systems - professional
laundries - where that happens," he says. "This business model
will go to the consumer market."
And then, when the washing machine reaches a certain age, the
maker can send the owner a message, offering a discount on a
We're clearly at such an early stage in the development of
machine-to-machine services that all ideas are being
considered. Some of them may end up unworkable - but in a few
years many may be so logical that we wonder why things didn't
always work like that. What do you mean, the washing machine
service engineer had to take it apart to find what was wrong?
And why didn't that cola company know where every drinks cooler
Brenneis will continue to generate new ideas, and will continue
to enthuse about this fast-developing business. "It's a very
exciting job, and I love it," he says.
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