zinnov zones for iot services

This report is solely for the use of Zinnov Client and Zinnov Personnel. No Part of it may be quoted, circulated or reproduced for distribution outside

the client organization without prior written approval from Zinnov.

Zinnov Zones forIoT Technology Services

ZINNOV ZONES 2016 – INTERNET OF THINGS TECHNOLOGY SERVICES

This report is solely for the use of Zinnov Client and Zinnov Personnel. No Part of it may be quoted, circulated or reproduced for distribution outside

the client organization without prior written approval from Zinnov.

Zinnov Zones forIoT Technology Services

zinnov.com/zones

3Zinnov Proprietary Confidential

Defining Internet of Things

IoT Technology Market Landscape

IoT Technology Service Provider Landscape

Zinnov Zones Ratings

Agenda


ENHANCED CONNECTIVITY

ENHANCED COGNITION

ENHANCED INFORMATION

ENHANCED COLLABORATION

COGNITIVE SYSTEMS

SELF LEARNING

Internet of Things is defined by the shift from products with discrete functionality to a connected cognitive system

DISCRETE

PRODUCTSCONNECTED

SELF ACTING

Source: Zinnov Research & Analysis


IOT PLATFORMS

IoT Technology is a fusion of multiple technology layers from Hardware layer at the bottom to Applications layer on top (1/2)

IOT APPLICATIONS

NETWORKING LAYER

SENSORS AND EMBEDDED SW/HW LAYER

NETWORKING CONNECTIVITY PROTOCOL

PERSONALRETAILHEALTHCAREAUTOMOTIVEINDUSTRIAL

ENABLEMENT LAYER

ANALYTICS

STORAGE

MIDDLEWARE


IncumbentsS

EC

UR

ITY


IOT PLATFORMS

NETWORKING LAYER

NETWORKING CONNECTIVITY PROTOCOL

ENABLEMENT LAYER

ANALYTICS

STORAGE

MIDDLEWARE

IOT APPLICATIONS

SENSORS AND EMBEDDED SW/HW LAYER

PERSONALRETAILHEALTHCAREAUTOMOTIVEINDUSTRIAL


New Age CompaniesS

EC

UR

ITY

IoT Technology is a fusion of multiple technology layers from Hardware layer at the bottom to Applications layer on top (2/2)


Agenda





Market Size

Market Trends


The propel by the semiconductor industry for IoT Technology has resulted in significant changes in the consumer value chain

Innovation in the semiconductor industry is driving the IoT revolution

Low Cost, Shrinking Form Factor and Ultra Low Power chipsets have enabled IoT growth1

Business Models are changing with IoT technology

Companies are exploring newer business models for revenue streams through data collected from IoT technology

Hardware is being offered as-a-service through IoT implementation

Hardware-as-a-service (HaaS) is becoming a shield against the threat of hardware commoditization

Companies are forming consortiums to enable standardization

Interoperability and standardization challenges are being addressed through consortiums

2

3

4


Low Cost, Shrinking Form Factor and Ultra Low Power chipsets have enabled IoT growth

Semiconductor companies are

Developing their IoT capabilities

or acquiring them

Forming consortiums with peers

to accelerate IoT innovation

Standardising platforms for

IoT development

Innovation in the semiconductor industry is driving the IoT revolution1


0

0.2

0.4

0.6

0.8

1

1.2

1.4

2 0 0 4 2 0 0 6 2 0 0 8 2 0 1 0 2 0 1 2 2 0 1 4 2 0 1 6 2 0 1 8 2 0 2 0

Sen

sor

Pri

ce (

$)

Cost of embedded hardware has been decreasing

exponentially

The computing power per area of chip has been boosted

due to the advent of advance chip architectures like SoCData storage prices have been falling for disks, NAND

flash, tapes and even cloud services

0

0.05

0.1

0.15

0.2

0.25

Oct

-06

Ap

r-0

7

Oct

-07

Ap

r-0

8

Oct

-08

Ap

r-0

9

Oct

-09

Ap

r-1

0

Oct

-10

Ap

r-1

1

Oct

-11

Ap

r-1

2

Oct

-12

Ap

r-1

3

Oct

-13

AWS Microsoft

Google

$/G

B

Tra

nsis

tors

/mm

2

1970 1980 1990 2000 2010 2020

102

103

104

105

106

107

108

1 2 3

Source: BI Intelligence Internet of Everything


Companies are exploring newer business models and revenue streams through data collected from IoT technology

Post IoT Integration

One-time upfront payment

Examples

Gemalto has launched IoT solution for real-time remote

monitoring of smart objects thus eliminating the middlemenAddressing end customers directlyDisintermediation

Fitbit to sell its data to German life insurer Generali who will

offer customized policies based on the dataSelling customer usage data to third partiesData-led Revenue

Smart Structures developed a system that embeds sensors in

structures during concrete pouring resulting in its real-time

health monitoring of the structures

Increased service and repair revenue through

constant product or customer monitoringMonitoring

Daimler’s Car2Go provides car-sharing services where cars are user-

accessed via an application irrespective of where the cars are parked

• Customized offering

• Product-as-a-service model

• Sharing economyServitization

Traditional Models

Business Models are changing with IoT technology2



Hardware-as-a-service (HaaS) is becoming a shield against the threat of hardware commoditization as the software layer is considered the real value-add

Hardware as a

Service

Reduced Capital Expense

Scalability

Better Troubleshooting & Maintenance

Better Security

HaaS enables converting large capital

expense into a more manageable operating

expenseHaaS helps to free up your cash flow and

provide more working capital

Proactive Service Model delivering a high

level of service integrity and operational

reliabilityThe equipment and service is included in the

SLA thereby avoiding purchase of new

hardware

Organizations can integrate any number of

new components depending on their needs

In case of unprecedented loss to business it

can be scaled-down as per requirement and

asset availability

Constant hardware and software update

of network securities

Easy upgrade to the latest hardware if

necessary for security reasons

Offers security sensors, smart locks,

thermostats, installation, servicing and

24/7 support for a monthly fee

Offers ‘train as a service’ where customer

is billed as-per-use through IoT data

Ride sharing like Citi bike charge

customers a monthly amount and monitor

usage through embedded sensors

Hardware is being offered as-a-service through IoT implementation3



Interoperability challenges owing to billions of connected devices and new IoT platforms everyday are being addressed through alliances and consortiums

One of the most widely used consortium under the industrial

internet spaceIndustrial Internet Consortium

Creates standards & certifications for devices involved in

enabling IoTOpen Interconnect Consortium

Manages the AllJoyn open source project which is used by LG

in commercial productsAllseen Alliance

Develops standards for interoperability among devices using

ZigBeeZigBee Alliance

Focuses on protocols & provides connectivity standardsThread

Develop architecture frameworks like threat model &

quadruple trust model IEEE P2413

Companies are forming alliances and consortiums to enable interoperability standardization4



Agenda





Market Size

Market Trends


Global spend on IoT Technology Products and Services by Corporates is ~USD 120 Bn and is expected to grow at 16% CAGR to reach USD 253 Bn by 2021

USD

54Billion

IoT Technology

Products

USD

66Billion

IoT Technology

Services

USD

253Billion

USD

120Billion

Total IoT Spend

2016

USD

110Billion

IoT Technology

Products

USD

143Billion

IoT Technology

Services

2016 2021e

Expected IoT Spend

2021

15.3%

16.7%

• Sensor, MEMS, Actuators,

Chipsets

• Connectivity Hardware including

gateways, data aggregators

• Network bandwidth

• Storage & Server Infrastructure

• IoT Platforms

• Advisory & Consulting

• Product Development

Engineering

• Managed Services



13.3

8.8

7.77.0

6.2

4.8 4.43.3

2.7 2.5 2.2 2.1

0.4 0.3 0.7

28.9

18.1

15.5 15.5

13.0

9.610.3

8.8

4.95.7

3.9

5.4

1.1 1.1 1.3

0

5

10

15

20

25

30

35

Industrial BFSI High tech Automotive Retail Telecom Energy Healthcare Transportationand Hospitality

Utilities Media andEntertainment

ConsumerPackaged

Goods

HomeAutomation

Wearables Others

Industrial, BFSI, Automotive and High Tech verticals are expected to drive the IoT growth contributing to ~55% of the spend in 2021

US

D B

illio

ns

Split of IoT Technology Services Spend by Verticals

CAGR 17% 15% 15% 17% 16% 15% 19% 22% 13% 18% 12% 21% 26% 26% 12%


2016

2021e

$66 Bn

$143 Bn

IoT Technology Services

Spend


North America

Europe

Asia

South AmericaMiddle East &

Africa Australia

16%

14% 20%

7%

5%

6%

26

0.7

18.6

0.14

0.6

2055.7 36.5 49

0.950.18

0.8

2016 2021e

At 20% CAGR, Asia is expected to grow at the highest rate contributing to ~35% of total spend by 2021

x x

IoT Spend in USD Bn

CAGR


Total IoT Technology

Services Spend in 2016

USD 66 Billion

Split of IoT Technology Services Spend by Geographies


IoT Technology Services Spend is expected to grow at 17% CAGR in the next five years to reach USD 143 Billion in 2021

2016

Service Provider

Addressed MarketService Provider

Addressable Market

66Bn USD

42Bn USD

2.8Bn USD

143Bn USD

107Bn USD

8.4Bn USD

2021e

6.7% of the

Addressable Market

8% of the

Addressable Market

17% 21% 23%


IoT Technology

Services Spend

64% of the Spend

75% of the Spend






Agenda


Asian IoT Technology Service Providers address ~47% of the total outsourced market in 2016

1.13 Bn

0.17 Bn

0.55 Bn

0.21 Bn

0.71 Bn

China

India

Eastern Europe

Western Europe

USA

IoT Technology Outsourcing HotspotsIoT Technology

Services Outsourcing

Addressed IoT Technology Services

Market through Outsourcing Partners

Billion

USD

0.03 BnOthers*

2.8

*Other Regions mainly include Argentina, Japan and Korea Source: Zinnov Research & Analysis

(in USD Bn)


0

50

100

150

200

250

300

350

400

0 20 40 60 80 100

Top 20 Service Providers contribute ~82% of the overall addressed market indicating a highly consolidated market

Top 20

82%Next 20

13%Remaining

5%

Revenue Distribution of IoT Technology Service Providers

Re

ve

nu

e O

f S

erv

ice

Pro

vid

ers

(i

n U

SD

Mn)

No. of Service Providers in decreasing order of revenuesSource: Zinnov Research & Analysis


IoT Technology Service Providers are bringing IoT focused changes in the way they operate and engage with customers


IoT specific partnership across the technology stack with niche companiesService Providers are partnering with platforms firms, start ups, VC funds, and universities with a focus on IoT

Newer IoT Technology specific engagement models:Service Providers are exploring their IoT offering through revenue sharing and outcome-based engagement models

Creation of IoT-specific platforms / solutions and Business UnitsService Providers are investing in IoT specific platforms, accelerators, frameworks, Ips, Delivery centres and COEs

Time & Material

Fixed price

Traditional ModelsOutcome-based

Risk-Reward

Usage-based pricing

New-Age Models

IoT

Integration

• Number of sensors installed

• Number of devices connected

• Amount of data stored / managed

• Optimization achieved, downtime reduced

Startup collaboration for disruptive tech:

• Engage and partner to explore

• Invest for niche solutions

• Acquire for brownfield opportunities

Connected Universe

PlatformMidas

UBIQweise

Service Providers are creating a separate Business

Unit for providing IoT Services to its customers

Building competency to win larger end-to-end dealsService Providers are expanding their IoT technology service spectrum coverage to win larger end-to-end deals

Deal Size: <$2Mn

Deal Proportion: 65%

Pure-play Engineering

Services companies

Deal Size: <$2-5Mn


End-to-End development

capabilities

Deal Size: >$5Mn


Large IT companies with

Managed Services forte






Agenda

Zinnov Proprietary Confidential 23

Zinnov Zones for IoT Technology Services has rated participants across 3 categoriesand their subsequent sub categories

Zinnov Zones - Internet of

Things Technology Services

IoT Advisory &

ConsultingIoT Managed Services

Connectivity & Networking

Engineering

Software Products & Platform

Engineering

Network Management

IoT Product Development

Engineering

IoT Sub Category Ratings

IoT Category Ratings

IoT Overall Ratings

Sensors & Devices Engineering

Decision SciencesEngineering Analytics

IoT Platform Management

Remote Monitoring & Infra

Management



Expansive

Low

HighZinnov Zones – Leading Service Providers

Niche

Emerging Established

• Emerging companies with presence across

Multiple Verticals

• Focus on building competencies across multiple

verticals

• Niche Breadth and Depth of services across

multiple verticals

• Emerging companies in Niche Verticals

• Focus on building Niche Competencies across

focus verticals

• Niche breadth and depth of services across focus

verticals

• Market Leaders across Multiple Verticals

• Strong focus on Innovation, IP creation, and

Ecosystem Linkages across most verticals

• Excellent Breadth and Depth of services across

multiple verticals

• High Scalability across most verticals

• Market Leaders with presence in Niche Verticals

• Strong Competency in Focus Verticals

• Excellent Breadth and Depth of Services across

focus verticals

Capabilities & Innovation, Specialisation

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity

IoT Technology Services: Overall Ratings



ExpansiveWipro

TCS

Tata Elxsi

Tech Mahindra

L&T Infotech

Genpact

Luxoft

HARMAN

Connected

Services

Low

HighZinnov Zones – Leading Service Providers

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity

Aricent

Infosys

Happiest Minds

Altran

L&T TS

HCL

VirtusaPolaris

EPAM

Persistent Systems

Ness Digital

Engineering Prodapt

Hughes

Systique

Innominds

Capabilities & Innovation, Specialisation

Cyient

GlobalLogic

GlobalEdge

eInfochips

Niche

Emerging Established

IoT Technology Services: Overall Ratings

Pratiti

Technologies

Accenture

Atos

Tieto

Cognizant

Capgemini

Partial Participation by Service Providers

Complete Participation by Service Providers



Service providers are evaluated across pre-identified key performance parameters and subsequently classified under Zinnov zones

Human Capital

Human Capital is critical in analysis of company’s capability to deliver specific engineering needs. We considered overall headcount, distribution by experience level, positioning (onsite/offshore), domain expertise across verticals.

Capabilities

Capabilities of the organization is assessed to understand the overall ability of the vendor to deliver on the requirements of clients; it encompasses strengths and advantages across People strength, operational capability, business models employed, and expertise of the organization

Innovation

Focus on innovations, IP creation and disruptive solutions through organic or inorganic capability development; this ensures the service provider capability to provide upcoming faster and cheaper go to market IoT solutions according to the clients needs

Ecosystem Linkages

Strategic partnerships with upcoming digitally native start-ups, University connects to focus on developing digital talent and research activities tell a lot about the organization’s capability in harnessing the ecosystem in Internet of Things Service space. We have covered all aspects as listed with specific weights to each as appropriate

Infrastructure

Infrastructure investment demonstrates capability and commitment to growth. Also, geographic spread and expansions throws light on the ability to leverage geo specific advantages. Companies that have invested in Infrastructure like Digital Labs and CoEs have strong capabilities in providing IoT Technology Services

Service Maturity

Client relationships, Service Line technology and business depth, along with established solutions are indicators of maturity. We used these parameters to assess the service maturity of the partner, which will help customers differentiate long term players from others

Nurture Zone Breakout Zone Execution Zone Leadership Zone

The cumulative score of enterprises based on the parameters is used to classify the service providers in one of the Zinnov Zones below-




Low

High

Scalability

Zinnov Zones – Leading Service Providers

IoT Competency

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity

The cumulative score of enterprises based on the parameters is used to classify the service

providers in Zinnov Zones

• Emerging entrants in the IoT

technology services space

• Presence in only a few

verticals: Focused growth

• Limited number of clients

• Niche capabilities across

focussed verticals

• Feeble IoT ecosystem

linkages

• Limited Thought Leadership,

Whitepapers, Frameworks

and IP

• Typically work in T&M model

• On the way into big league,

delivering IoT services

effectively

• Presence in limited verticals

• Innovation frameworks

resulting in tangible benefit to

customers

• Generic capabilities across

Consulting, Product

development and Managed

Services

• Typically work in T&M and

Fixed Price model

• Capable of performing

concept to Go-To-Market for

IoT Technology

• Presence in most verticals

• Reusable IPs and

frameworks built, and

benefits quantified

• Strong IoT ecosystem

linkages

• IoT specific labs and COEs

built

• Capable of working in all

models, including Risk

Reward and Revenue Share

• Competent to implement

End-to-End IoT technology

solutions

• Presence in almost all

verticals

• Formal innovation culture,

resulting from strong Thought

Leadership to create

frameworks and IP

• Core of the IoT ecosystems

• Established IoT labs and

COEs

• Capable of working in all

models, including Risk

Reward and Revenue Share


Human Capital, Capabilities, Innovation, Ecosystem Linkages, Infrastructure, Service Maturity



Wipro

TCS

Tata Elxsi

Tech Mahindra

L&T Infotech

Genpact

Luxoft

HARMAN Connected

Services

Low

High

Scalability

Zinnov Zones – Leading Service Providers

Aricent

Infosys

Happiest Minds

Altran

L&T TS

HCL

VirtusaPolaris

EPAM

Persistent Systems

Ness Digital

EngineeringProdapt

Hughes

SystiqueInnominds

IoT Competency

GlobalLogic

Cyient

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity

IoT Technology Services: Advisory & Consulting

Pratiti Technologies

Accenture

Atos

Tieto

Cognizant

Capgemini






IoT Technology Services: Product Development Engineering

Nurture Zone Breakout Zone Execution Zone Leadership ZoneHighZinnov Zones – Leading Service Providers

Infosys

Tata Elxsi

Tech Mahindra

Genpact

Luxoft

Altran

Aricent

Wipro

Happiest

Minds

HARMAN

Connected

Services

L&T TS

VirtusaPolarisEPAM

Persistent

Systems

Ness Digital Engineering

Prodapt

eInfochips

Innominds

GlobalEdge

GlobalLogic

Hughes

Systique

Cyient

Low

Scalability

IoT Competency

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity


TCS

HCL

Accenture Atos

Tieto

CognizantCapgemini






IoT Technology Services: Managed Services


Low

Scalability

Wipro

TCS

Tata Elxsi

Tech Mahindra

L&T Infotech

GenpactLuxoft

HARMAN Connected

Services

Aricent

Infosys

Happiest Minds

Altran

L&T TS

EPAM

Persistent Systems

Ness Digital

Engineering

Prodapt

eInfochips

Innominds

GlobalEdge

GlobalLogic

Cyient

HCL

VirtusaPolaris

IoT Competency

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity

Atos

Tieto

Cognizant

Accenture

Capgemini






IoT Technology Services: Sensors & Devices Engineering


Low

Scalability

Infosys

TCS

Tata Elxsi

Tech Mahindra

Luxoft

HARMAN Connected Services

Wipro

Happiest Minds

Altran

L&T TS

HCL

EPAM

Innominds

GlobalEdge

GlobalLogic

Hughes Systique

Cyient

eInfochips

PersistentSystems

Prodapt

IoT Competency

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity


Genpact

Accenture

Atos

Tieto

Cognizant

Capgemini




Aricent



IoT Technology Services: Network Engineering & Management


Low

Scalability

Infosys

TCS

Tata Elxsi

Tech Mahindra

HARMAN Connected Services

Aricent

Wipro

EPAM

L&T TS

Happiest Minds

Innominds

GlobalEdge

GlobalLogic

Hughes

Systique

Cyient

Altran

eInfochipsNess Digital

EngineeringProdapt

IoT Competency

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity


Genpact

HCL

AtosTieto

Cognizant

Accenture

Capgemini






IoT Technology Services: Software Platform Engineering and Management


Low

Scalability

Tech Mahindra

L&T Infotech

Luxoft Happiest Minds

EPAMPersistent Systems

Ness Digital

Engineering

Innominds

L&T TS

Genpact

Prodapt

GlobalLogic

HARMAN

Connected

Services

Infosys

TCS

HCL

Cyient

Altran

Aricent

eInfochips

Hughes

Systique

Tata Elxsi

GlobalEdge

IoT Competency

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity


Wipro

Atos

Tieto

Cognizant

Capgemini

Accenture






IoT Technology Services: Engineering Analytics & Decision Sciences

`


Low

Scalability

TCS

Tech Mahindra

L&T Infotech

Genpact

Luxoft

Wipro

HCL

EPAMPersistent Systems

Ness Digital

Engineering

Innominds

GlobalLogic

Cyient

Aricent

eInfochips

GlobalEdge

HARMAN

Connected

Services

Infosys

L&T TS

Prodapt

Happiest Minds

Altran

Hughes

Systique

IoT Competency

Scale

, S

erv

ices D

ivers

ity,

Vert

ical D

ivers

ity

Atos

Tieto

Cognizant

Accenture

Capgemini






Disclaimer

In the context of Zinnov Zones for IoT Technology Services, we reached out to a limited set of service providers that could be potential leaders in

this space. Our set of inclusion criteria enables us to shortlist, effectively based on which service providers are invited to participate. While we

normally see significant interest in participation, sometimes a service provider may request to be excluded from the Zinnov Zones activity if the

timing of the research or circumstances within the service provider organization makes participation difficult. If a service provider declines to

participate at the beginning of a Zinnov Zones process, it is important to know the following policies:

Some non-participating service providers are still included in our evaluationo As we invite only leading service providers and emerging players to participate in the Zinnov Zones, if a service provider decides not to

participate, we have still included them in the final report if we think it is necessary

o Our reasoning is that a Zinnov Zones without a leading service provider would project an partial picture of the market and make it less

pertinent for our clients

The Zinnov Zones report clearly differentiates service providers that did not undergo the same rigorous evaluation

as its peerso While our analysts have evaluated the service providers that declined to participate, the service provider’s place in the rating is denoted

by a differentiating symbol indicating non-participation in the research process

o Their assessment is based on different inputs than those used for evaluating its peers

We have reached out to the non-participating vendors to schedule a detailed briefingo In an effort to ensure accuracy while circumventing the rigorous evaluation, we have tried to gain as much information from non-

participating vendors on a briefing call as possible

o If we could not arrange such briefings, we have conducted our research through secondary means

Bangalore

69 "Prathiba Complex",

4th 'A' Cross,

Koramangala 5th Block,

Bangalore-560 095.

Phone: +91-80-41127925/6

Singapore

Level 42, Suntec Tower Three

8 Temasek Boulevard

Singapore 038988

Phone:+65 6829 2123

Texas

21, Waterway Ave

Suite 300

The Woodlands

TX-77380 USA

Phone:+1-281-362-2773

Beijing

Meilifang Tower 4, Entrance 4,

10/F #1003,

11 Beiyuan Shuangying Road,

Chaoyang District, Beijing

China 100012

Thank You

Gurgaon Office:

First Floor,

Plot no. 131, Sector 44,

Gurgaon-122002,

Phone: +91 124 4420100

California Office

3080 Olcott Street

Suite A125,

Santa Clara, CA 95054

Phone: +408-716-8432