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Slide 1: 50 billion connected devices by 2020 What does it means for YOU ?
Slide 2: EVERYTHING WILL be connected Drivers - Entertainment, security, health - Productivity, new revenues - Sustainability, regulation Connected consumer electronics Intelligent transport, industry and society, smart utilities - Broadband ubiquity - Declining cost of connectivity Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 4 Enablers
Slide 3: Business processes in 2020 Self service applications, M2M communication and automation will transform business processes Transport Government Healthcare Utilities Manufacturing Financial Services Security Retail ICT is critical to secure sustainable competitiveness Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 6
Slide 4: Market growth The mobile M2M communications market will grow from $16 billion in 2008 to more than $57 billion in 2014 Strategy Analytics Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 7
Slide 5: Size of market opportunity Total Cellular M2M Connection Revenue by Application 10000 9000 2010 8000 7000 ($ Millions) 6000 5000 4000 3000 2000 1000 0 Transport Utilities Health Other Source: ABI Research, Q3 2009 Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 8 2011 2012 2013 2014
Slide 6: M2m will take off 300,0 Other Healthcare Utilities Million connections 200,0 Transport 250,0 150,0 100,0 50,0 0,0 2010 2011 2012 2013 2014 2015 Source: ABI Research, 2009 › Machines will become connected with value-based rather than volumebased business models of today. The wholesale price will reflect the connection value rather than data volume. Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 9
Slide 7: Strengths of the mobile network model › Existing global wide area coverage › Global standards › Economies of scale › Global roaming › High performance › Provisioning › QoS Management and Policy Control Made possible by Entel’s leadreship and Ericsson’s technology Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 10
Slide 8: Industry Verticals Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 11
Slide 9: Transport industry actors RAIL Road Administration ROAD Public Transport People & Goods Automotive Transport Service Provisioning Transport Hub Operation AIR Transport Infrastructure Mgmt SEA Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 12
Slide 10: intelligent transport systems › ITS = Intelligent Transport Systems & Services – Road, Rail, Air, Sea – People and goods › The integration of ICT with – transport infrastructure – vehicles – users › Purpose to increase – Safety – Efficiency – Sustainability ...in the transport systems Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 13
Slide 11: pain points by stakeholder - Transport Industry OEM Sub suppliers Car dealers / service Fleet / truck owner Public Transport Driver Insurance Infrastructure Government Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 14 • Requirement to develop electrical and hybrid engines • Shift of profit pool to service based business • Continuous cost reduction of 3% / year expected • Integrating seamless supply chain with OEM plants • Handle increased complexity of cars • Increase size of stores and number of stores in chain • Reduce consumption of fuel • Optimise truck utilization • Increase customer satisfaction • Handle full customer perspective incl. multi-modal travel • High accident and death toll not acceptable • Reduce time in traffic jams and searching for parking • Cars with mobile connections allow online applications • Reduce road accidents and car theft • New ways to capture risk profiles and do good pricing • De-bottleneck, critical for economic growth • Succeed with Public-Private-Partnership • Reduce traffic congestion • Reduce environmental impact from traffic • Increase safety and ensure traffic rule compliance Source: BCG, Ericsson
Slide 12: Public transport Use case: Service disruption information Description › Service disruption information in real time › All touch points wirelessly connected Benefits › Passenger benefits › Reduced uncertainty › Waiting time perceived as shorter › Smarter journey planning › Public transport authority benefits › Growth in number of travelers › Increase in customers willingness to pay › Contracted operator benefits › Reduced penalties Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 15
Slide 13: Public transport Use case: Service disruption information Revenues › Number of travellers is expected to grow with 5% if providing sufficient service disruption information › Growth translated into revenues from fares › Yearly additional revenues for PTAs › Stockholm: 26 M€ › London: 147 M€ › Total market value in annual revenues › Sweden 52 M€ › Great Britain 327 M€ Value chain Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 16
Slide 14: PLAYERS IN THE Utilities world Spot Market Fuel / energy source Type of node # of nodes Oil & gas other fuel 10 000 Generation Transmission Distribution Energy Service Providers Utilities 10 000 “Pro-sumers” Utilities 10 000 National grid 1 000 Utilities 10 000 Consumers 10 000 000 000 System Integrators Energy Management solution vendors Electricity Network Vendors Telecom Vendors Telecom Operators Smart Meter Vendors Appliance Manufacturers Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 17
Slide 15: pain points by stakeholder - Utilities Industry Utilities • Grid investments is bottleneck • Cutting emission from traditional energy sources • Profitable investments in renewables • Distributed generation cannibalizing central approach • Ability to set high prices in boom times • Increased need for technical equipment and services due to more difficult production • Differentiation vital to ensure profitability • Succeed in China key to strong growth • Secure supply of electricity • Low and stable electricity prices • 100% availability important with increasing electricity dependent life style • Consumption information need •“Pro-sumers” – consumers producing energy • Secure national energy supply • Stop climate change Oil and gas industry Equipment suppliers Large consumers/ industry Small consumers Government Source: BCG, Ericsson Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 18
Slide 16: PLAYERS IN THE Government world Local goveRnment Regional government PUBLIC SAFETY -First responders -Second responders -Command & control centers NATIONAL GOVERNMENT NATIONAL SECURITY -Civil defense, defense -Critical infrastructure owners -Customs, coast guard, border authorities SUSTAINABILITY Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 19
Slide 17: Government eco system Social security Immigration and citizenship Commerce Treasury Tax authority Ministries Government administration Strategic planning Operational support Service delivery Citizen 100 central governments Enterprise Public security Assess Prevent Prepare Respond Resolve Rebuild 3,000,000 number of policemen Attorney general Police Prisons Courts Fire department Process (Government) Customers Internal Stakeholders Note: Education and health care covered in other verticals Source: BCG, Ericsson Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 20
Slide 18: pain points by stakeholder - government General government • Cost pressure pressuring efficiency and effectiveness • Ensure compliance to laws and rules Tax authority • Increasing complexity in tax system requiring more resources to ensure compliance Law enforcement • Rising number of crimes in society together with rising threat from outside endangering public safety • Rising unemployment increasing demand for unemployment benefits • Limited opening hours of government offices making it difficult to visit them • Demand for more customized service and services to a higher quality level • Inexpensive labor or will off shore • Functioning basic infrastructure Social security Citizens Enterprises Source: BCG, Ericsson Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 21
Slide 19: Healthcare value chain eco system Regulatory Providers Pharmacists Pharmaceutical Sales and Distribution Doctors Hospitals Drug Discovery Drug Development Manufacturing Patient Public health bodies Payers Other retailers Insurance E-channels Medtec Process (pharma) Providers and channels Customers and payers External stakeholders Source: BCG, Ericsson Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 22
Slide 20: pain points by stakeholder - healthcare Pharmaceutical companies • Restructuring of R&D to take out cost, improve diagnostics and focus on HTA agencies requirements • Need to drive innovation in order to grow • Need to improve productivity in terms of both outcomes and costs • Shortages of specialists, doctors and nurses • Ability to focus fully on their job and reduce administrative hassle and time drains • Push customers to generics and private label goods Medtech companies Healthcare providers HC professionals Wholesalers/ pharmacies Patients Government and insurance payers • Need to actively manage their own health and lifestyle • Limit the growth of HC costs and only paying premiums for drugs/products with proven outcomes Source: BCG, Ericsson Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 23
Slide 21: Operators are active Automotive Healthcare Finance Transport Utilities Insurance Retail Security Logistics Construction Government Education 0 5 10 15 Number of operators active (of 22 total) 20 25 30 NB. Number of active operators can be more than 22 per vertical, as some operators have more than one activity within a specific vertical. Source: Ericsson, 2010 Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 24
Slide 22: Vertical specific services Telecom Italia • T-box - in-car system connected to HSPA • ‘Blue&Me Nav’ with Fiat Auto • LocHNESs • e-Voting terminals • e-Government terminals • ENERGY@HOME Telecom Italia • FleetNET Easy • MyENERGYgas management • Tele-assistance • Geofencing • MYDoctor@Home * This is a selection of the vertical specific services Telecom Italia is offering Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 25
Slide 23: smarter public transport Mobile broadband supported fleet management › Buses in Curitiba, Brazil connected via Ericsson mobile broadband module. Using electronic ticketing and fleet management systems, controllers access information & monitor their bus fleet. By knowing routes, stops, speed, distance traveled, time of departure and arrival public transport is optimized. In cooperation with › › • More precise fleet control • Quicker ticketing & boarding • Increased safety • Avoids ticket fraud Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 26
Slide 24: Conclusions › Broadband proliferation is at an inflection point, poised to bring radical improvements for society – Individuals, Enterprises, Governments – Social, Economic, Environmental › We are moving towards a converged broadband enabled world with connectivity embedded into all kinds of devices › Driven by the tremendous success of the mobile ecosystem, we envision most device connectivity to be based on 3GPP technologies Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 27
Slide 25: Of 50 billion connected devices in 2020, how many of these will be connected to Entel’s network? Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 28
Slide 26: Entel SUMMITT 2010 | Public | © Ericsson AB 2010 | Page 29