iot evolution · really driving us as a differentiator. we think deploying this technology can move...
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IOTEVOLUTIONHow the IoT is driving new opportunities in 2018 and beyond
Alexandra Rehak Practice Head, Internet of Things – Ovum
Charles JuniperPrincipal Analyst, Financial Services Technology - Ovum
John SousanisManaging Director – WardsAuto Intelligence
AGENDA• Key IoT Trends for 2017-2018
• IoT Impact in the Global Insurance Sector
• IoT and Automotive: Necessary Connections
THE IOT IS NOT ONE-SIZE-FITS-ALL
Diverse technologies
Diverse customer
needs
Diverse business models
0
500
1000
1500
2000
2500
3000
3500
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Co
nn
ecti
on
s (M
n)
Global M2M and LPWA IoT Connections
total M2M total LPWA
NEW TECH OPENS UP NEW USE CASES
LPWA use cases
LPWA = 1986 Mn
M2M = 962 Mn
“We have parking pay and display using GSM, Bluetoothconnectors on the road network, air quality sensors, and traffic signals.
There’s a city council initiative on connected bins – but not using our LoRa network –they’re using GSM. And Ofo are using Sigfox to track their connected bikes.“
- UK Smart City ProgrammeManager
CSP/telco (e.g., BT, Vodafone)10%
Enterprise IT vendor (e.g., Cisco, IBM)
40%
Systems integrator (e.g., Accenture, Tech Mahindra)
19%
Industry vertical or industrial specialist (e.g., Philips,
Bosch, GE)10%
Enterprise applications provider (e.g., salesforce.com , Oracle)
11%
Specialist IoT applications or solutions provider
7%
WHO DO CUSTOMERS GO TO FOR IOT?
Q: “Who is the main provider of your IoT deployment or solution?”. Source: Ovum IoT Enterprise Insight Survey
building datasets for future business insight
better use of environmental/energy resources
shift to as-a-service or usage-based business…
developing new revenue streams
improving employee productivity
growing existing revenue
improving customer experience
increasing competitiveness
improving business processes
reducing costs
WHAT ’S DRIVING IOT DEPLOYMENT?
Q: “What are the main goals of your IoT deployment or plan?” Source: Ovum IoT Enterprise Insight Survey
building datasets for future business insight
better use of environmental/energy resources
shift to as-a-service or usage-based business…
developing new revenue streams
improving employee productivity
growing existing revenue
improving customer experience
increasing competitiveness
improving business processes
reducing costs
WHAT ’S DRIVING IOT DEPLOYMENT?
Q: “What are the main goals of your IoT deployment or plan?” Source: Ovum IoT Enterprise Insight Survey
“The biggest thing for us, to be honest, is customer satisfaction, which is really driving us as a differentiator.
We think deploying this technology can move us up the value chain with customers. “
- US Manufacturer
IOT CHALLENGES VARY BY INDUSTRY
Source: Ovum IoT Enterprise Insight Survey
Data and network security concerns
Integrating with ICT infrastructure
Service reliability concerns
Up-front capital investment requirement
Expected ongoing running costs
Integrating with business processes
Q: What’s your biggest challenge in deploying IoT projects successfully?
IOT ENABLES NEW BUSINESS MODELS
Event- or usage-based
Customer pays only (or mainly) on trigger event
As-a-service
Shift to managed service approach
using IoT
Data-leverage
IoT data as basis for new revenue streams
DISRUPTION IN UNEXPECTED PLACES
Non-data companies can also lead on IoT monetization
• Connect customer’s non-connected devices + processes
• Sell data + insight back to customers
• Sell data to third parties
KEYS TO SUCCESS: SIMPLICITY, FLEXIBILITY, VERTICALIZATION
Diverse technologies
Diverse customer
needs
Diverse business models
AGENDA• Key IoT Trends for 2017-2018
• IoT Impact in the Global Insurance Sector
• IoT and Automotive: Necessary Connections
IOT IS REDEFINING INSURANCE BUSINESS MODELS
•Reduce risky behaviour
•Pre-emptive intervention
•Dialogue with customer
•Automated & high speed
•Accurate & detailed data
•Process efficiency & fraud
•Connection to individual items
•Pricing reflects risk
•Pricing reflect usage
•New sectors
•New services
•Valued purchaseSelling &
MarketingPricing
Risk
Managing Risk
Managing Claims
IMPACT ON INSURANCE COMPANIES
16% 15%26%
27%45%
41%
41%
28%24%
15% 11% 8%
0%
20%
40%
60%
80%
100%
Within 12 Months Within 24 Months Within 36 Months
% o
f Su
rvey
Res
po
nd
ents
Transform Our Organization Significant Impact on Our Organization Some Impact Limited Impact
‘What do you believe the impact of IoT, telematics or wearable sensors devices will be on the your organization?
Sample: 474 insurance senior decision makers
CHANGING COMPETITIVE DYNAMICS
13%
10%
10%
8%
13%
14%
17%
18%
22%
25%
27%
33%
31%
37%
35%
39%
34%
31%
39%
39%
35%
32%
32%
31%
31%
34%
23%
20%
22%
17%
16%
13%
Vehicle Manf.
Utility Co's
Telco's
InsurTech's
Security Co's
FS excl. insurers
GAFA*
Other Insurers
% of Survey Respondents
Major Competitive Threat Competitive Threat Minor Competitive Threat No threat
‘What level of competitive threat do the following types of organization present to your company when it comes to
offering IoT, telematics or wearables-based insurance products?’
Sample: 474 insurance senior decision makers*GAFA = Google, Amazon, Facebook & Apple
THE NEW INSURANCE PROPOSITION
Today
‘Bucket’ & Opaque Pricing
Multiple Policies
Annual Renewal
Disconnected From Insured Items
Infrequent Communication
Inefficient Claims
‘Pay to clear up the mess !!’
IoT-Based Insurance
Insurance as a Utility
Pre-emptive Risk Management
Value-Added Dialogue
Automated Claims
‘Avoid the mess in the first place’
AGENDA• Key IoT Trends for 2017-2018
• IoT Impact in the Global Insurance Sector
• IoT & Automotive: Necessary Connections
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
• Keeping up with the smart phone• Mobile, personalized connectivity• Navigation, concierge services
• Smart home on wheels• Personalized environment• Heating, cooling, lighting, acoustics
• Usage/user data
CONNECTED IN OUR CARS
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
IMPACT OF IOT ON AUTOS• Creating new business models for automakers• Attracting new players to the market• Changing every aspect of the vehicle and industry
• Safety and driving (not driving?)• Maintenance – OTA monitoring and updates• Insurance – usage and user pricing • Fleet Management – connecting vehicles• Cybersecurity
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
IMPACT OF AUTOS ON IOT
• Arguably most important extension of IOT• 50% of today’s new cars are connected to
the Internet • 100% (~100 million vehicles/year) by 2025• Creates new classes of user/usage data• Completes the picture• Furthers the cause with public, government,
businesses
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
THE PROBLEM WITH CARS
CARS CONSUME
• >50% oil goes toward gasoline
CARS CONGEST
• Land-use: parking, streets
• City gridlock, commuter traffic
• Record demand – 90 million
• 1.4 billion vehicles on the road
CARS POLLUTE
• #1 global warming contributor (NASA)
• >50% CO and NOx emissions
CARS KILL
• 1.2 million deaths/year
• More than WAR + MURDER
• #1 cause of death 15-29 yr olds
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
• Connected fuel-economy improvement driven by select systems, such as Smart Cruise Control, whose estimated impact is shown to the right
• Connected autonomous vehicles could reduce passenger car fuel consumption 44% by 2026
• Connected driving-cycle management alone can improve fleet efficiency 5%
Estimates from Autonomie Vehicle Performance Analysis Software
CONNECTED CARS – EMISSIONS & FUEL ECONOMY
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
• Connected-vehicle traffic management on freeways • Reduce the number of crash-related incidents• Increase the level of throughput on roads• Reduce traffic delays in already congested areas
• Increased stages of ADAS and autonomy increase safety• Reduce need for parking in city centers
• Safety solutions require redundant levels of connectivity
CONNECTED CARS – CONGESTION AND SAFETY
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
A Matrix of Connections• Onboard Wireless LAN• System-to-system connections• Connection(s) to the Internet• Vehicle to Infrastructure sensors,
servers• Vehicular Ad hoc networks (V2V)• Systems-to-Service connections• Vehicle-to-Devices• Vehicle-to-Grid
THE CONNECTED VEHICLE
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
BUILDING THE NETWORK: THE AUTO IMPERATIVES
• V2C Vehicle to Cloud;
• Full coverage, requires investment in cellular, Wi-Fi
• V2V Vehicle-to-Vehicle
• Requires international standardization, regulation
• V2I Vehicle to Infrastructure:
• Pillar of Autonomy; Traffic management; Safety
• Requires government regulation, investment in IoT
IOT & AUTOMOTIVE NECESSARY CONNECTIONS
• IoT/connected vehicles will be the key driver of change in the auto industry for the at least a decade
• Government regulations and investment, consumer demand and commercial interest will be activated by societal needs for safer, cleaner more efficient mobility
• Complexity and urgency of automotive IoT needs will act as a catalyst on overall IoT development and adoption
SYMBIOTIC DEVELOPMENT
Thank you. Questions?
Alexandra RehakPractice Lead, IoTOvum+44 (0) 7770 785 798alexandra.rehak@ovum.com @RehakResearch
Charles JuniperPrincipal AnalystFinancial TechnologyOvum+44 (0) 7876 791 092charles.juniper@ovum.com
John SousanisManaging Director
WardsAutomotive Intelligencejsousanis@wardsauto.com
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