Dr Patrick Dixon Chairman Global Change Ltdhttp://www.globalchange.com

Future Telecomhow to create magic for your customers why existing business models are broken

What customers really want

One word will dominate ALL

FUTURE

The future is aboutEMOTION

ALL      BIG      TRENDS      ARE      RELATED  

MOST    DEBATES    ABOUT    TIMING  

300 million move to cities in China and 475 million to cities in Africa by 2030

Growth of Middle Class in Africa 250m people - $2 trillion by 2040

WGP  2005-­‐2014  (%,constant  prices)

Vietnam  GDP  1985-­‐2011  

>40%  WDP  by  2015� IMF - adjusted for Purchasing Power Parity

$3.4  trillion    

$2.4  trillion    

Reserves  

Big strategies often overtaken by events World can change faster than you can hold a board meeting

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What  does  she  know?  What  can  she  see?  SoWware  bugs  Roaming  ?!  

Data  charges  ?!

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CONVERGENCE OR

DIVERGENCE All real innovation is about

doing things differently to serve customers better

Innovation Magic is Hard to Find

“It may be smart, innovative,

astonishing, but does it really create magic for the customer?”

Creating magic for clients often costs

NOTHING

Why  old  telco  business  models  are  bust  

Many  in  UK  no  longer  watch  live  TV

95%  EU  bandwidth  soon  video  Days  of  charging  for  calls  /  SMS  nearly  over  

Tele-­‐presence  20%  growth  pa      $4.5  billion    

 BUT  video  is  unpopular  at  work

Impact  on  bandwidth

•Global  demand  à  250  tbps  2016  •40-­‐100  Jmes  growth  in  next  10  years  •More  than  5%  global  power  >1  trn  KwHs  •=  1  billion  kw  heaters  for  an  hour

How mobile will transform how people think

and feel about YOU

Internet of Things

where is real benefit ?

1.5m components tracked perfectly in Airbus supply chain

$5bn home automation market

Wearable  Health  Devices  will  be  almost  

universal    

Home Tele-Monitoring

Impact of retail and payments revolution on

vodafone future

e-­‐commerce  hits  $1.5  trn

Mobile Magic Mobile influences $29bn of retail sales in UK 50% of all UK online sales are using mobile

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Fusion  On-­‐Off  line    social  media  

physical  friends

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Online / physical worlds become one in Brazil

50% research online - buy in store 40% research in store - buy online

89% want digital information in store

Buy online - deliver to store Buy in store - deliver at home

1  trillion  pages                            a  month        >50%  revenues  from  mobile  

Why Google is under pressure and what it means for Vodafone

"Perfection!,"  TripAdvisor Member, March 13, 2014 This was the most beautiful hotel. Delightful, perfect. We will stay again soon. "Terrible! TripAdvisor Member, Sept 10, 2013 Terrible place, rats, dirty, noisy - sick with food poisoning.

Over  4000  road  hauliers  in  EU

1.3bn  home  delivered  e-­‐com  items  in  UK  a  year  (+12%  pa)

Gold  standard:10am  orders  for  3pm  Delivery

10am orders for 3pm Delivery

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3000 Parcel Shops in UK in 12 months Chosen by up to 50% customers for

deliveries - help for local stores

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2m  businesses  use    SQUARE    in  US

bitcoin

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Bitcoin  

Google Mobile Wallet Monetise (mobile payments for banks) Square startup $3bn valuation

100  mobile  payment  placorms  launched  in  last  5  years  but  how   many  met  real  CUSTOMER  needs  ?

Near Field Tech / RFID is last-century add-on

to smartphones

CUSTOMER  CHOICE   200  million  payments  globally

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Payments to home by migrants

are driving Innovation

• Kenya  -­‐  17m  customers  • $9bn  pa  -­‐  >33%  GDP  • Tanzania  9m  people  • 35  nagon  links  via  HomeSend  Hub  

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1.7bn  phone  users  are  unbanked

Savings,  payments,  loans,  insurance 400m  will  be  newly  banked  by  2015

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33%  of  US  smartphone  users  will  use  mobile  banking  in  2014

90% check balances 42% transfer between accounts 26% pay bills 49% users download bank apps

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• In  UK  alone....  • TransacJons  >£600  billion  pa    • Credit  card  debt  >£60bn  • Average  card  interest  rate  16%  • 2%  commissions  worth  £12bn

Payments

Doorway

Banks and Telcos on Collision Course

Free mobile devicescalls / web / TV / games / payHigher income model

2010                                                  2013                                  2015                                                    

TelcoBank Magic

Beher  Biometrics

Time at bank teller cut from 4 to 1 minute

90% all global data

generated in last 2 years

Big  Data  and  Lihle  Data  

• Home• Work• Online• Offline• Sales• Entertain• Phone• Mobile• Chat• Social web• Mobile

ONE CUSTOMER

MAGIC

• 90%  MicrosoW  R&D  

CLOUD•When  all  life  in  cloud,  then  device  and  connector  don’t  maher  

Aramco - 30,000 computers hit - files lost

Overwhelming CYBERATTACKS

from States or criminals

Internet  of  Things  -­‐  Big  Data  -­‐  Cloud  180bn  spam  emails  a  day  

600m  new  viruses,  malware,  trojans  a  year  >220m  people’s  details  lost  in  single  ahack  70%  large  corporagons  have  been  hacked  

100,000  ahacks  an  hour  on  US  Navy  Paralysis  of  Estonia  government  in  2007  

Worries  about  US,  Russia,  China  penetragon  

Almost all bank IT

spend is on legacy, compliance, security

impossible to keep pace with customers

So how does Vodafone make

money in future?

Amazing customer experience today - partner to create new, diversified, services tomorrow

•Individuals•Family•Clients•Investors•Community

Making  Life  Beher    

Create  magic  for  your  customers

Dr Patrick Dixon Chairman Global Change Ltdhttp://www.globalchange.com

Future Telecomhow to create magic for your customers why existing business models are broken