WORKSHOP

Positioning technology providers: Evolving landscape & opportunities

Abstracts from our

European Location Study 2010

Navigation & Location Summit Europe - Berlin - 15th June 2010

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Introduction

PTOLEMUS assists its clients, from strategy definition to business development

Our services

Strategy definition

Strategic due diligence

Innovation management

Business development

Our areas of expertise

Positioning / Location enablement

Navigation

Location-based content & services Telematics

Intelligent transport systems

Mobile content and social networking

M2M

Connectivity

• Partners in Paris, London and Brussels• +30 years of experience in mobile• +30 years of experience in telematics

Introduction

We have acquired substantial experience in the field of geo-connected mobility

3

Telecom operators Infrastructure providers

ITS providers

Montezemolo & Partners

Venture capitalistsInsurers & assistance providers

Content & application providers

Car & telematics vendors

3

Introduction

We will publish our European Location Study by end June

• 200 pages of analysis about positioning and their impact on the location industry, built on

• Interviews with over 100 executives from all sides of the industry, from Admob to Yahoo!,

• Over 6 months of desk research and primary research, notably an online survey,

• A detailed market model so as to combine strategic and technology analysis with hard figures

• PTOLEMUS will offer a free version to all executives interested by location

• A full version will also be proposed

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Location and connectivity are penetrating all sorts of devices

1

Source: PTOLEMUS

Landscape overview: devices

Low HighTotal solution intelligence

Local device intelligence

High

Low

Connected PND

Connected car

Smartphone

Connected plug

Die-cutting machine

Connected photoframe

Connected train

WiFi router

Connected copier

Parking metre

Tractor

Airplane

Fixed phone

Laptop

Connected truck

Connected vending machine

Server

OvenTraffic light

Air conditioning system

Elevator

Layering machine

Fridge

Lawn mower

Hairdryer

Washer

Toaster

Connected watchConnected

videocamera

Cash register

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We counted 109 markets powered by positioning

1

Source: PTOLEMUS

Landscape overview: services

Mature

Nascent

• Fleet management

• Asset management

• Driver management

• Stolen vehicle recovery

• Lone worker protection

• People tracking

• Emergency services tracking

• Geofencing

• Indoor asset tracking

• Hospital management

• Contextual service access

• Location-sensitive billing

• Fraud prevention

• Mobile network optimisation

• Cellular inter-network border negotiation

• Profiling

• Advertising

Desktop centricMobile device centric

Commercial vehicle centric

Network centric

• Access control

• Business intelligence trending

• Data visualisation

• Aerial imagery

• Government GIS

• Infrastructure planning

• Media planning

• Retail analysis

• Financial services analysis

• Fraud prevention

• Defence & emergency services planning

• Intelligent Transport Systems (ITS)

• Property sales & management

• Retail planning

• Digital tachograph

• Fuel consumption monitoring

• Eco routing

• Remote diagnostic & maintenance

• Road charging

• Driver profiling

• PAYD insurance

• PAYD leasing

• PAYD rental

• PAYD tax

• Active car safety

• ADAS

• Mobile network optimisation

• Roaming traffic analysis

• Location-based pricing

• Home / work connection analysis

• Crowd management

• Call traffic geography analysis

Location-enhanced applications: Business to Business

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1Landscape overview: services

We counted 109 markets powered by positioning

Mature

Nascent

Mobile centric

• Location-based social networking

• People tracking

Outdoor

• Cycling• Trekking• Fishing• Fitness• Tourism• Discovery• City guides

Indoor

• Museum guide• Indoor navigation• Indoor search and discovery• Accessibility

Environment centric

Car centric Network centric Desktop centric

• Maps

• Navigation and traffic

• Geotagging• Geocaching• Location-based

marketing• Location-based

advertising• NFC

• Stolen vehicle recovery

• Roadside assistance

• Speed camera tracking

• PAYD insurance

• Road charging

• Local search and discovery

• Parking search / booking

• Car sharing

• Infrastructure-based safety (V2X)

• Navigation

• Concierge

• Car / key finder

• Traffic prediction & ETA

• Emergency call

• Social networking

• Yellow Pages

• Local search & discovery

• Location-based marketing & advertising

• Hyper local news

• Fraud prevention

• Access control

• Business intelligence trending

• Government GIS

• Security and tracking

• Traffic information

• Weather

• Multimedia content geotagging

• Pedestrian navigation

• Local search and discovery

• Dating• Social networks

• Shopping / retail• Events

• Restaurant• Sport• Gaming

• Geo-tagging: MMS/SMS graffiti

• Zone alarm• Geo-located SMS

Location-enhanced applications: Business to Consumer

Source: PTOLEMUS

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Today, 3 technologies take the lion share of positioning

1

Source: PTOLEMUS

3 key technologies and their markets

UWB

Future growth

Number of currently equipped devices

NICHEEMERGING

PERVASIVEPRIME

MEMS

Circle size is proportional to the number of markets where each technology is present

GPS / A-GPS

Wi-FiCell-ID

GALILEO

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2

Positioning in consumer markets is a €1 billion market in Europe… growing to €2 billion in 2014

• The number of located mobile devices will double in next 4 years

• 70% of these devices will be located using GPS

• GPS represents 75% of the positioning equipment sales in Europe in 2010

GPS is king

0

500

1.000

1.500

2.000

2.500

3.000

0

500

1.000

1.500

2.000

2.500

3.000

2007 2008 2009 2010 2011 2012 2013 2014

Consumer electronics GPS salesNetwork location investmentWiFi location positioning data Positioning sensors

Positioning technology consumer market in Europe (Euros, in millions)

Phenomenal growth of location

Source: PTOLEMUS

2

9

2

In the car, GPS will remain a key component of the positioning solution for most growth areas

GPS is king

0

3

7

10

13

17

20

2009 2010 2011 2012 2013 2014

Embedded NavigationeCallRoad user chargingPNDsAftermarket navigation systemsPAYD insuranceStolen vehicle recovery

2

Penetration of GNSS systems in the car (line-fitted only) (% of new cars sold)

0%

20%

40%

60%

80%

2009 2010 2011 2012 2013 2014

Embedded GPS-only chipsetsEmbedded GPS / Galileo chipsetsEmbedded GPS / Glonass chipsetsEmbedded GPS / Galileo / Glonass chipsets

Future growth markets for in-car positioning (in millions)

Source: PTOLEMUS

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3

Today’s positioning technologies do not always respond to users’ requirements well

3 key market drivers: expectations and needs

Source: PTOLEMUS

23

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

Coverage Accuracy Speed Reliability Power consumption Privacy

Positioning technologies main challenges

10Source: PTOLEMUS

3

GPS is in all smartphones – but not alone anymore

• Numerous mobile services such as LBSN will require positioning to work- Always (passive & active)- Everywhere: in the office, in the

subway, in the restaurant, etc.

• As a result, leading vendors such as Nokia and Apple will integrate A-GPS, WiFi location (WPS), accelerometers and compasses into new smartphones

• No single positioning technology today can tackle all needs, which pushes hybrid solutions

3 key market drivers: always & everywhere

Positioning technologies in smartphones in Europe (%)

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Micello, indoor map provider

3 key market drivers: indoor

Several technologies can address indoor positioning needs

Depending on the loction and the need, indoor navigation and tracking may require a combination of

• WiFi (provided by companies such as Navizon and Skyhook),

• MEMS

• UWB (Ultra-Wide Band) and SWB (Super-Wide Band),

• RFID (Radio Frequency IDentification),

• Pseudolites (or Pseudo-satellites), ground-based radio transmitters that transmit a navigation signal (Insiteo)

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13

3 key technologies and their markets: WPS 4

However, one technology answers today’s indoor location needs better than the other

And maybe soon?

WiFi positioning turns GPS location on its head:

• Like Cell-ID, uses an existing network bearer to provide positioning

• Software-based solution with deals direct between data provider and device vendors

• Users provide database updates and drive coverage growth solutions.

• Developers obtain free access to location

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3 key technologies and their markets: WPS 4

WPS coverage is growing at an extremely rapid pace

• WiFi networks offer a dense and pervasive networks in urban areas

• WPS can also work without cellular data connection

• Devices equipped will triple in next 4 years

• We expect - new database providers to emerge

- accuracy to improve (to the metre range?)

Skyhook's coverage in EuropeBuilding on WiFi networks

4

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3 key technologies and their markets: GNSS

Source: European Commission - Directorate General for Industry and Transport

4

A number of complementary satellite technologies will make GPS-only outdated

• EGNOS augmentation satellites provide integrity and added accuracy in rural areas

• A-GPS reduce the error margin and the TTFF

• GLONASS will operate at the end of this year and will provide greater availability

• Galileo will bring greater integrity, accuracy and availability to GPS

Service class

Horizontal Accuracy

Vertical Accuracy Vertical

Accuracy AvailabilityService class Availability

Open Service 1-4 m 8 m8 m > 99.5%

Commercial Service

20 cm(TBC)20 cm(TBC) > 99.5%> 99.5%

Safety of Life Service 1-4 m 8 m8 m > 99.5%

Public Regulated

Service1-4 m 8 m 8 m > 99.5%

Galileo will bring the greatest benefitsSeveral satellite solutions improve GPS

Today

Today

2010

2014

4

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3 key technologies and their markets: Cell-ID

Source: PTOLEMUS

4

Cell-ID’s business model needs to be adapted to reflect its true growth potential

• Truly global• Universal• Non intrusive• Highly scalable IP Location Cell-ID

Current volumes billions location requests / day

>5 million location requests / month

(EU)

Price <€0.01 / request <€0.04 / request

AvailabilityAll mobile phones

with a data connection

All mobile phones

Coverage Fixed & mobile networks Mobile networks

Accuracy

3rd party access No opt-in No opt-in

Cell-ID can compete with IP location The price of location requests will continue to fall

0 €

0,02 €

0,04 €

0,05 €

0,07 €

0,09 €

2006 2007 2008 2009 2010 2011 2012 2013 2014

4

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How to leverage Cell-ID for tracking: case study of LociLoci

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3. Network-based location technology pulls location from device on request

Smartphone does not compete well here

3rd party service provider works better

2. Monetise network location without need for operator’s input

9 operators, 3 countries, all handsets

1. Generates value from key operator’s asset usually vastly under-utilised

Simple, straightforward, successful service

4. Authorisation, privacy, billing & access all managed at network level

Cell-ID - Case study - LociLoci

Kajsa Lundfall, CEO

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How the LociLoci business model works

5Cell-ID - Case study - LociLoci

Subscribers: 20,000

Subscription: 0.5 to 2.5 per week (depends on geographical market) Resell location: €0.03 (volume discount after 100K/ month)

INCOME COST

Cost of Cell-ID location: < €0.03 per ping (varies per network)

Operator's share (revenue and billing) : 41%

SMS aggregator's share of subscribers revenue: 6%

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Looking outside GPS for direct benefits

6Benefits of non-GPS solutions

Current

Low growth potential

Fleet management

Traffic information & ETA

Driver management

Floating vehicle data

Asset management

In-car navigation

Mobile local search

Speed camera tracking

Roadside assistance

E112

Stolen vehicle recovery

Active safety

Road charging

PAYD insurance

Geo-caching, gaming

People / pet tracking

eCall

Indoor LBS

Geo-content

Cycling/ trekking/ fishing

Hospital management

Location-based marketing & advertising

Tourism / city guide

Location-based social networking

Pedestrian navigation

MNO applications

High growth potential

Emerging Future

Medium growth

potential

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Monetise positioning data today: who pays for location?

7Controlling positioning and location data

Devices

Browser vendor

OS vendor

Device vendor

Chipset vendor

Positioning technologies

Satellite positioning operators

Device-centric positioning providers

Location platform vendor

Network-centric positioning providers

Networks

Network Operator

Location aggregators

Network infrastructure vendor

Network location infra. & middleware

Location-based services

LBS & GIS platform vendor

Location-based application provider

Application store operator

Map and POI suppliers

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Positioning at the core of the device strategy

7Controlling positioning and location data

Skyhook's WiFi positioning

system

• Fix in less than 1 second

• Indoor location possible

Cellular tower triangulation

(Google)

Skyhook's WiFi positioning

system

• Almost universal coverage

Cellular tower triangulation

(Google)

Skyhook's WiFi positioning

system

GPS

• Universal coverage• High accuracy

outside cities

GPS

Cellular tower triangulation

(Google)

Skyhook's WiFi positioning

system

Compass

• A sense of direction!

GPS

Cellular tower triangulation

(Google)

Skyhook's WiFi positioning

system

Compass

• Indoor navigation unlocked

Gyro

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Controlling positioning is key to build and create a new ecosystem

7Controlling positioning and location data

Reference networks

GOOGLE

WiFi & Cell-ID positioning database

Application developers

GNSS chipset manufacturers

End-users

Mobile operators

Advertisers

Handset vendors

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Long live GPS!

Positioning is at the core of the service, network and device strategies

• GPS monopoly is coming to an end

• Not all technologies are designed to do the same, e.g.

- Mobile operators (or others) can leverage Cell-ID to make it an alternative to IP location

- WPS will prosper indoor and expand to outdoor, including the car

• It is not about which technology is best but which technology combination is best

• Innovative players who design original positioning strategies will bring differentiation and value in markets that are becoming commoditized (e.g. navigation)

• Controlling the positioning value chain will be a key competitive advantage, notably for LBA

Long live GPS!

Strategies for Mobile Companies

Brussels - Paris - Londoncontact@ptolemus.comwww.ptolemus.com

Frederic BruneteauManaging Directorfbruneteau@ptolemus.comTwitter: @PTOLEMUS