A number of regulatory issues in markets around the world have the potential to hamper the growth of the Internet of Things (IoT) and machine-to-machine (M2M) sectors, warned Machina Research this week.

In particular, the company said an expected crackdown on permanent roaming – where a device is left connected to a roaming partner's mobile network in another country – could have negative consequences for any operator currently relying on this method for its multinational M2M services.

According to Machina Research, more than 80% of the world's telco regulators currently have no explicit rules governing permanent roaming; however, it expects that situation to change.

"Mobile operators that currently support lots of connections that way had better do two things. Firstly stop selling more, as that's only exacerbating the problem. Secondly build alliances with other operators to ensure local connectivity in every country," said Machina director Matt Hatton, in a statement on Wednesday.

Data sovereignty represents another challenge to budding M2M and IoT service providers, since different regulators have different rules governing how and where data – particularly consumer and government data – can be stored and moved.

Furthermore, some countries have implemented rules requiring SIM cards to be registered to a particular person or legal entity, Machina noted, which could prevent service providers selling pre-activated, off-the-shelf M2M devices.

"As with all new technologies, in the Internet of Things, regulation lags behind technical and commercial developments. To date this hasn't caused a lot of problems, but it won't be long until there is something of a crunch," said Hatton.