New Regulations in Brazil Will Benefit M2M Market

Brazilian regulations regarding M2M devices on new vehicles will have an enormous effect on the telematics and fleet management market in the country. A law introduced by the Brazilian government in mid-2013 will required 20 percent of new vehicles to be equipped with M2M devices by the end of 2013, will raise the requirement to 40 percent by August 2014 and 100 percent by the end of 2014.

This law is mainly aimed at curbing vehicle theft in the country, which according to the Sao Paolo Transport Union has risen to an unprecedented 1,256 vehicles a day. Over 450,000 vehicles are stolen per year in Brazil and likely transported to neighboring countries for resale. These thefts account for enormous costs to insurance companies and consumers.

Telefónica and América Móvil will likely receive the greatest benefit from the new regulations put in place by Brazil’s State Traffic Department (DENATRAN). The program, entitled SIMRAV, will require that almost all steps of the process including equipment vendors, system integrators, and mobile service providers, be licensed and approved by DENATRAN. This will ultimately result in the creation of a more formal M2M ecosystem within the developing Brazilian market.

As adoption becomes standard, competition is likely to rise from other companies as more businesses aim to enter and take advantage of the growing market.

M2M as a technology as well as a market will benefit in the coming years from similar government regulations that demand the creation and implementation of M2M technologies in mass produced and almost universally purchased products, such as consumer and commercial vehicles.

Mobile service providers in developing nations stand to benefit from further growth if this trend continues. These companies and their infrastructure serve to further the world of connected devices, as connected solutions are offered to current problems.