IoT vs M2M

Machine-to-machine communication, or M2M for short, is a growing technology trend. This involves the automated exchange of information between end devices such as vehicles or machines and with a control center. Companies can save costs and improve work processes through M2M communication. A second technology trend, that evolved from M2M is the Internet of Things (IoT). These terms are often used as synonyms interchangeably. While there are some overlapping characteristics, the network architecture of both technologies is fundamentally different.

The origins of M2M and IoT


The term IoT originates from 1999 and was first coined by Kevin Ashton, one of the co-founders of the global research association for Automatic Identification and Data Capture or Automatic Identification of Things (Auto-ID Labs).


Networked communication between machines has been around since the mid-20th century. M2M communication actually originates from telemetry, where the measured values from weather stations, for example, were sent automatically via telegraph lines. Today’s form of M2M has only been practised for about 15 years. Nowadays, data transmission largely takes place via broadband mobile communications channels in the 3G and 4G networks or WLAN.


An early form of machine-to-machine communication is, for example, the transmission of the caller’s telephone number from one telephone to another. While many such M2M applications initially relied on a hard-wired connection, the mobile radio-supported networking of machines began in 1995 when Siemens created a separate department for the GSM data module “M1” within its then mobile device division. This marked the start of the company’s commercial and industrial use of M2M. Point-of-sale systems and vehicle tracking were among the module’s first applications.


Today’s M2M modules are much more powerful and have integrated technologies such as GPS. Now cloud services are also playing an increasingly important role in M2M, which in turn is transitioning to the Internet of Things. Machine-to-machine communication is more or less a predecessor of the Internet of Things. Every IoT environment has M2M components, but not every M2M network has IoT features.

Two buzzwords, one mutual benefit


M2M solutions aim to streamline workflows and increase productivity.  For example, vending machines can independently inform a central computer that they need to be restocked and what is missing. This means that regular trips by the vending machine operator can be avoided. Continuous remote monitoring of the vending machines also counteracts longer downtimes. Increasingly, the Internet is being used for this, using various access networks such as a mobile network – so this is where IoT and M2M overlap. The streamlining of business processes achieved by M2M and IoT solutions and the resulting cost savings represent a great market potential for industry and commerce.


We can now see a certain convergence between the two terms M2M and IoT: Both technologies form the basis for similar and now overlapping solutions and business models. However, the underlying technology, especially communication technology, is still different in many cases. For the user, however, this hardly matters; from a pragmatic point of view, it is a matter of which technology is best suited for the application in question. Efforts to standardize techniques and protocols in M2M and IoT are apparent.


IoT vs M2M in a nutshell

Internet of Things Machine-to-Machine
Automates end nodes (sensors and actuators) using a network, featuring bi-directional (downlink and uplink) communication Enables direct communication between multiple machines
Communication with a cloud Point-to-point communication
Many users (i.e. engineers, network operators, security personnel…) can access it at the same time Due to the Point-to-Point network architecture, machines communicate with a single device at a time.
May require an active internet connection (end nodes are typically equipped with an IoT SIM card or an integrated eSIM) Devices may be able to communicate directly without relying on an active internet connection
Requires software, to operate and maintain the hardware Strong emphasis on hardware components

  • M2M and IoT are terms for two innovative technological milestones in device automation that frequently get confused with one another.
  • IoT is more or less a derivative of M2M, where machines don’t communicate directly with one another, but instead indirectly via a central cloud.
  • The first identified M2M applications date back to the 1950s, while the term IoT was first coined in 1999.
  • IT solutions based on both technologies share a common goal: To streamline business processes, reducing operational potential. Thus the market potential of various industries, by making the deployment, operation and maintenance of devices and machines, that are integral to the specific business, truly scalable.