the m2m market in the economic downturn - robin duke woolley
TRANSCRIPT
M2M in the Downturn
April 7, 2009
Robin Duke-WoolleyCEO, Beecham Research Ltd.
Boston I London l Bonn l Milan
Copyright © 2009 by Beecham Research Ltd. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means -- electronic, mechanical, photocopying, recording, or otherwise -- without the permission of Beecham Research Ltd.
Internet of Things & M2M Help Drive Speed/Flexibility into Decision-Making: Adding Value in Downturn throughout Value Chain
Definition• Networked products connected in an eco-system of: content, technologies, smart devices, infrastructure
and services• Smart devices know: who you are, where you are, your content preferences, and best medium to deliver
content• Connectivity occurs across: on-board systems, device-to-device, & device-to-web• Innovation is driven by leveraging the eco-system to deliver value to user via new capabilities … driving
new business models for both products and services
Benefits• Differentiated product to market:
Revenue growth via higher market share and/or price premiumIncreased profits via higher margin value-added extensions
1. Connected Products Solution
Pay per use
Huge Capital Investment for Hospitals, Medical Clinics
Replaced by Pay Per Use by product manufacturer
Result: Scanning used regularly for medical diagnosis
Manufacturer takes over risk
Monitors everything remotely
Detailed cost and use analysis to maintain business case
New business models:Creating Service pull – superseding technology push
MRI scanner as a totally outsourced solution: Hardware-as-a-Service
Definition• Wireless sensors (RFID, Smart Dust) monitor events and conditions• Sensors are in components, inventory, machinery, and locations• Sensors show identity, location tracking, shock, temperature, and tampering• Sensing is conducted across procurement, warehousing, manufacturing, and delivery
Benefits• Real-time visibility into part locations, status, quality, and environmental conditions• Improved supply chain reliability and productivity• Security enhanced by constant monitoring
2. Supply Chain Solutions: Integrating M2M into the Business Model
• Installed GPS-enabled logistics system to link delivery trucks to central control center
• Stage trucks and dispatch/re-route dynamically based on up to the minute customer needs
Benefits:Grew customer satisfaction and revenue:
–Reduced delivery window by >85%–15% sales growth
Cost savings:–Delivery trucks cut by 35%–Projected $100M savings in OpEx
Sensor Intensive Supply Chain Example: Cemex Cement Delivery
Definition• Monitoring devices collect valuable information• Devices are connected to the network and monitored centrally• Diagnostics and preventive and predictive maintenance are conducted remotely• Field technicians are dispatched automatically with the right solution• Engineers learn from actual product and customer behavior
Benefits• Value-added service revenue• Higher services margins• Lower warranty costs
• Lower service operations costs• Shorter time to resolution• Higher customer satisfaction
3. Device Monitoring Solutions
Eliminate damage to the magnet
Reduce downtime
Reduce loss of revenue
Avoid rescheduling patient appointments
Example: Air Products KeepCOLD® Services
Three Categories of M2M Applications - Examples
After-Market Applications
Regulatory
Line Fit/OEM• Service led• Medium/High Volume• All sectors• Embedded networking• Low cost per unit
• Regulation led• Medium/High Volume during install• Specific sectors/applications• Embedded networking• Low cost per unit
• Application led • Low/Medium volume per application• All sectors • Add-on networking: retrofit • Medium/High cost per unit Vending
Toll Collect
Meter Reading
eCall
OnStar/ Telematics
HandheldTracking
Pumps
VineyardMonitoring
Car Wash
M2M Application Categories
Time
After-market ApplicationsNetwork add-on“Low hanging fruit”High CostLow Volume
RegulatoryEmbedded networkSpecific productsLow CostHigh Volume
OEM-based Embedded network Across all venuesLow CostHigh Volume
Connections
Impact of Current Economic Climate
After-Market Applications
Regulatory
Line Fit• Some products substantially affected by downturn:
• Projects delayed• New house starts down• Car sales down 15-50%
• BUT, some are investing in downturn for longer term competitive advantage
• Govt. initiatives less affected • Regulatory less affected, eg Energy sector
• Less affected – installed base• eg Commercial Security, 3G • Individual apps affected, eg Fleet/Freight, Containers, Commercial Shipping, Industrial (raw material) • Opportunities for operational cost savings
Vending
Toll Collect
Meter Reading
eCall
OnStar/ Telematics
HandheldTracking
Pumps
VineyardMonitoring
Car Wash
M2M Landscape – Service Sectors, Applications and Devices
Infrastructure Comfort &Convenience
• Office• Education• Retail• Hospitality• Healthcare• Airports• Stadiums
Commercial /Institutional
Public Infrastructure
Emergency Services
• Equip. & personnel- Water treatment- Building environ.- General environ.- Surveillance
• Equip. &personnel- Police, - Fire- Regulatory
Tracking
• Human• Animal• Food/Health• Packaging• Baggage• Postal
Equipment Enterprise
IT/Data CenterOfficePrivate Nets
Public
• Services• E-Commerce• Data Centers• Mobile Carriers• Fixed Carriers• ISPs
Supply/ Demand
Oil/Gas
Rigs• Derricks• Well Heads• Pipelines• Pumps
Awareness & Safety
Security/AlertsFire SafetyEnviron. SafetyElderlyChildrenPower Protection
• Wiring• Network Access• Energy Mgmt
Buildings Consumer& Home
Industrial Healthcare &Life Science
Energy Retail Transportation
• Super-Markets• ShoppingCenters• Single site• Distribn.Centers
Stores Hospitality
• Fuel Stations• Gaming•Bowling• Cinemas• Discos• Special events
• Hotels• Restaurants• Bars• Cafes• Clubs
Specialty
Distribution
• Pipelines• Mat’l Handling• Conveyance
• Consumer • Commercial• Construction• Off-Hiway
Vehicles
• Air• Rail• Marine
ResourceAutomation
Converting/Discrete
Fluid/Processes
• Mining• Irrigation• Agricultural• Woodland
• Metals • Paper• Rubber/Plastics• Metalworking• Electronics• Assembly/Test
• Petro-Chemical• Hydro Carbons• Food/Bev•
• Implants
• Home MonitoringSystems
• Hospital Room• ER • Mobile POC• Clinic• Labs• Doctor Office
• DrugDiscovery
• Labs • Diagnostics
Internet of Things
ResearchCare In Vivo/Home
Alternative
• Process
• Clean Room
• Campus
Industrial Non-Vehicular
Devices: TVs, Power Systems, Dishwashers, Lighting,Washer/Dryers, Meters, Lights, Alarms, etc.
Devices: Pumps, Valves, Vats, Conveyors, Pipelines, Motors, Drives, Converting, Fabrication, Assembly/Packaging, Vessels/Tanks, etc.
Devices: Turbines, Windmills, UPS, Batteries, Generators, Meters, Drills, Fuel Cells, etc.
Devices: Servers, Storage, PCs Routers, Switches, PBXs, etc.
IT & Networks
Surveillance
• Radar/Satellite• Environmental • Military Security• Unmanned • Fixed
Devices: Cars, Ambulances, Fire, Breakdown, Lone Worker, Homeland Security, Environment Monitor, etc.
• Weapons• Vehicles• Ships• Aircraft• Gear
Devices: Tanks, Fighter Jets, Battlefield Comms, Jeeps, etc..
• Solar• Wind• Co-Generation• Electrochemical
• Tolls• Navigation• Traffic Mgmt
Trans Systems
• Power Gen • Trans & Dist• Low Voltage• Power
Quality• Energy Mgmt
Public Safety& Defense
HVAC / Climate LightingAppliancesEntertainment
Devices: MRI, PDAs, Implants, Surgical Equip,Pumps, Monitors, Telemedicine, etc.
Devices: POS Terminals, Tags, CashRegisters, Vending M/cs, Signs, etc.
Devices: Vehicles, Lights, Ships, PlanesSignage, Tolls, etc.
Devices: HVAC, Transport, Fire & Safety, Lighting, Security, Access,etc.
Energy: Moving to a Smart Grid – Supply side
M2M Opportunities in addition to Smart Metering:• Development of Smart Grid - substations• Microgrids• Alternative energy sources:
• Wind, Tidal, Solar, Thermal, Fuel Cell
Consumer M2M: Approaching a Mass Market – New Report April 2009
millions BRL Issue: January 2009
Image Source: www.t-mobile.de
Consumer M2M: Approaching a Mass Market – New Report April 2009
Beecham Research: April 2009
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2007 2008 2009 2010 2011 2012 2013
Consumer M2M Product Shipments (millions)
2008 Adopter Survey, SIM-Related:
Considering the needs of your M2M-enabled products, how important are the following factors?
2008 Adopter Survey, Network Services:
How important are the following network services?
M2M Services Revenue Streams for Cellular ($m)
Beecham Research: July 2008
Comparison of Revenue Streams for Cellular
Beecham Research: July 2008
Value-Added Services
System Applications/Service Enablement
Network Services
HardwareEnablement
Typical Market Players at Each Level
Service Enablement: Key Issues for Research (Q2 2009)
1. Service Enablement purpose:• Reduce Installation and Running Costs (Adopter Survey results)• Reduce time to market for new services: Create Service Pull• Application Providers: Focus on end user, not infrastructure• c/f Windows and Applications • Market Catalyst: bringing order to a fragmented market
2. Value Assessment• Build versus buy for connectivity infrastructure
– Cost elements– Establishing an ROI– What connectivity provides lasting value?
3. Key Features – now and future: Which add value from user perspective?4. Key sectors – early adopters 5. Who does what?
• Value chain players – compete or collaborate?
About Beecham Research
Beecham Research offers focused research, analysis and consulting services to high technology suppliers, service providers and product manufacturers:
• Focus on network-connected products and services – M2M and the “Internet of Things”.
– Worldwide coverage for all business sectors and all technologies
• Founded in 1991. New name Beecham Research Limited (BRL) from early 2008.
• Based in London. Operating out of Boston MA, London UK, Bonn Germany, Milan Italy.
– Representation in AsiaPac and Latin America regions in progress
• Senior staff with many years of M2M experience internationally – well known in the industry
• Emphasis on services enabled by M2M technologies and on M2M market development through new service implementations:
The services we offer:• Consulting and custom research
• Subscription-based research service – Retainer Service
• Standard publications include Worldwide M2M Market Forecast Report at hardware and service levels, and individual M2M Service Sector Reports (9 sectors)
• Conferences, in conjunction with our partners – Berlin October 2009
About Beecham Research – more
Some of our recent clients: