the connected consumer and smart m2m services mike ueland vice president & general manager telit...
TRANSCRIPT
The Connected Consumer and Smart M2M Services
Mike UelandVice President & General ManagerTelit Wireless Solutions
Connected Consumers are Mainstream91% US wireless penetration; 25% of all households are wireless only
92% of population is covered by 3G network
6500% Rate of AT&T”s wireless data growth past 3 ½ yrs
89% of the handsets on wireless carriers’ networks are Web capable
Sources: CTIA, AT&T, ABI Research
Regularly visit community sites
(Facebook, MySpace, YouTube)
Kindle eReader sales tripled in the first
half of 2010 and are outselling hard
covers
Over 300,000 iPads sold on the first day
(April)
Consumers are creating and consuming digital data and media
Sample ApplicationsM2M Functions
• Track usage• Upload data• Report changes• Monitoring and
notification• Transactions• Digital displays• Location tracking• eReaders/ emerging
devices
Moving to M2M 2.0
Batch •Communication
Productivity •Customer benefit
Niche •Market size
Real-time
Usage based pricing
Broad
M2M 1.0 M2M 2.0
M2M 2.0 Market Drivers
•New OEM automotive telematics incorporating 3G (Audi)•Opens up new applicationsEmerging 3G •Next generation 2G/3G modules driving down size/power/price•Carriers open to innovative pricing models (i.e. Kindle)
Airtime & Equipment Costs
•AT&T (EDO), Verizon (ODI), Sprint (Emerging Solutions) have all reorganized their structures•AT&T expects to boost subscriber penetration to 500%
Operators Engaged
•Legislations such as the eCall mandate in Europe, Resolution 245 of the Brazilian government and local initiatives in China create huge market potential
Regulatory Changes
M2M‘s Impact on the Connected Consumer
Recent reductions in the cost to deploy are enabling more consumer-focused applications
Applications have the potential to make a BIG impact on choices we make in our daily lives
Applications can produce positive benefits to individuals and societyMany of the new applications are driven by the principles of
behavioral economicsBehavioral economics is a field of economic research that looks at
how individuals make economic related decisions – what does this really mean….
m2m Enables Economic Incentives and Influences Positive Consumer Behavior
What is Behavioral Economics?
Behavioral Economics
A classic example is the difference between opt-in and opt-out in a program such as organ donation.
If you tell people that they can opt-in to donating their organs if they are
killed, a few will feel strongly enough to do it—most people won't. If you switch that to opt-out the
reverse happens—very few people opt out.
All of economics is meant to be about people’s behavior. Right??So, what is behavioral economics, and how does it differ from traditional economics?
Traditional Economics
• Conceptualizes the world populated by humans that are rational that behave in a way to maximize their individual self-interest• Framework ignores or rules out virtually all behavior and
includes unrealistic traits
Behavioral Economics
• Assumes individuals don’t always make “rational” decisions because of being influenced by other factors/context• Markets are inefficient
Example – How Choices are Presented Influence Outcomes
• Director of food service for a major city school system influenced what students ate by changing how the food was presented in the cafeteria line• Putting fruit before desserts or moving carrot sticks to eye
level• District found they could increase or decrease the
consumption of food items by 25% without making changes to the menu• Practice of giving people freedom of choice but steering
them toward decisions that benefit themselves and society is called “libertarian paternalism” • Director of food services is a “Choice Architect” by
arranging food choices that resulted in healthier selections- organizing context for decision making
Applying Libertarian Paternalism to M2MApplications Provide Incentives for People to “Do The Right Thing”
• Pay as You Drive captures driving behavior and encourages better driving habits through lower rates • i.e. Progressive Insurance with MyRate Program
• Congestion-based tolls to reduce traffic accidents, congestion and pollution• Demand response programs in the utility sector encourage people to shift
electric power usage to nonpeak periods• Pay as You Throw households that throw out more pay more for trash
collection encourages recycling• Medical reminders to patients encourages better overall health
• i.e. mHealth solution from Vitality, GlowCaps
Pay As You Drive Insurance• Launched in 2008; currently in 22 states• Easy self-install by the consumer into the vehicles
OBD II port• Voluntary program offering 15-25% discounts
based on driving habits• Captures driving data, distance, time, sudden
acceleration, and braking• Benefits Progressive by better calculation of risk,
lower loss ratio, improved segmentation• Benefits consumers through lower premiums• Societal benefits could be fewer accidents, lower
car emissions and less road maintenance
Payment Assurance• As condition of loan, finance
company requires black box• Auto disabler prevents car
from being started• Locate and recover asset
when payments are not made• Encourages on-time payments• Expanding from “Buy Here,
Pay Here” to traditional auto financing• 35-45 million car sales a year,
20 million are sub-prime
mHealth Solutions – GlowCap by Vitality• GlowCaps use light and sound to signal
when it is time to take a pill – relays status to Vitality’s secure network• GlowCaps can even call with refill
reminders and connect the patient to their pharmacy as pills deplete.• Each month GlowCaps mails a printed
report to you and your doctor if requested • Encourages better health and reduces
costs through health maintenance and daily medication adherence• 800 million people have chronic
conditions (GSMA)
Pay as you Throw• Charges households a higher bill for
putting out more trash for collection• Cost effective method of reducing
landfill disposal and toxins • Encourages and increases recycling
efforts• Recycling containers can send
information about how full they are and trigger pickup•Weight of recycled material can be
credited to each household and used to reduce taxes or as a credit towards municipal services
Summary• Consumers are more connected
than ever before•M2M 2.0 is about providing
consumers with more timely information in which to make better decisions• New business models are being
created that leverage M2M technology and create “win-win” scenarios