the internet of everything€¦ · the internet first came to us on pcs estimated global pc...
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Providing in-depth insight, data, and analysis of everything digital.BI Intelligence
The Internet of Everything
THE INTERNET FIRST CAME TO US ON PCS
Estimated Global PC Installed Base
Source: BI Intelligence Estimates, 2015
-
15
30
2015E 2016E 2017E 2018E 2019E 2020E
InstalledDe
vices(Billio
ns)
IT THEN MOVED TO SMARTPHONES
Estimated Global PC And Smartphone Installed Base
Source: BI Intelligence Estimates, 2015
-
15
30
2015E 2016E 2017E 2018E 2019E 2020E
InstalledDe
vices(Billio
ns)
Smartphones PersonalComputers
EXPANDED TO TABLETS, SMARTWATCHES, AND TVS
Estimated Global PC, Smartphone, Tablet, Connected TV, And Smartwatch Installed Base
Source: BI Intelligence Estimates, 2015
-
15
30
2015E 2016E 2017E 2018E 2019E 2020E
InstalledDe
vices(Billio
ns)
Smartphones
PersonalComputers
Tablets
Smartwatches
ConnectedTVs
AND IS NOW COMING TO ALL OF OUR EVERYDAY DEVICES UNDER THE INTERNET OF THINGS
Estimated Global PC, Smartphone, Tablet, Connected TV, Smartwatch, And IoT Device Installed Base
Source: BI Intelligence Estimates, 2015
-
15
30
2015E 2016E 2017E 2018E 2019E 2020E
InstalledDe
vices(Billio
ns)Tablets
PersonalComputers
Smartwatches
ConnectedTVs
IoTDevices
Smartphones
BY 2020, 34 BILLION DEVICES WILL BE CONNECTED TO THE INTERNET
Estimated Global Internet-Connected Device Installed Base
Source: BI Intelligence Estimates, 2015
-
20
40
2015E 2016E 2017E 2018E 2019E 2020E
InstalledDe
vices(Billio
ns)
THAT’S MORE THAN 4 DEVICES FOR EVERY HUMAN ON EARTH
2020 Estimated World Population Vs. Internet-Connected Devices
Source: UN, BI Intelligence Estimates
8
34
GlobalPopulation Internet-ConnectedDevices
Billio
ns
THE INTERNET OF THINGS HAS THE POWER TO REVOLUTIONIZE EVERYTHING
Source: Shutterstock- Mikko Lemola
IT’S REVOLUTIONIZED OUR HOMES…
Source: Shutterstock
OUR BUSINESSES…
Source: Getty
AND OUR CITIES…
Source: Shutterstock
WHAT’S DRIVING THE IOT’S GROWTH?
BY 2018, HALF OF THE WORLD WILL BE CONNECTED TO THE INTERNET
Estimated Penetration Of Global Population Using The Internet
Source: ITU
0%
50%
100%
2005 2007 2009 2011 2013 2015E 2017E 2019E
AND THE PRICE OF HARDWARE THAT MAKES THE IOT POSSIBLE IS DROPPING
Average Sensor Cost Forecast
Source: Goldman Sachs, BI Intelligence Estimates, 2014
$0.00
$0.75
$1.50
2004 2006 2008 2010 2012 2014 2016E 2018E 2020E
BY 2020, 24 BILLION IOT DEVICES WILL BE INSTALLED
EstimatedGlobalInternet-ConnectedDeviceInstalledBase
Source: BI Intelligence Estimates, 2015
-
15
30
2015E 2016E 2017E 2018E 2019E 2020E
InstalledDe
vices(Billio
ns)
THE MAJORITY OF IOT DEVICES WILL BE USED BY BUSINESSES AND GOVERNMENTS
Estimated Global IoT Device Installed Base
Source: BI Intelligence Estimates, 2015
0
15
30
2015E 2016E 2017E 2018E 2019E 2020E
InstalledDe
vices(Billio
ns)EnterpriseIoTDevices
GovernmentIoTDevices
AND BUSINESSES WILL BE THE TOP INVESTOR IN IOT SOLUTIONS
Estimated Global IoT Investments Compounded 2015-2020
Source: BI Intelligence Estimates, 2015
$-
$5
$9
Enterprise Government Consumer
USD(Trillions)
HOW ARE BUSINESSES USING IOT DEVICES?
AS OIL PRICES FALL…
Historic Oil Prices
Source: Federal Reserve, Bank Of St. Louis, 2015
$-
$20
$40
$60
$80
$100
$120
OIL AND GAS EXECUTIVES ARE INVESTING IN THE IOT TO BECOME MORE EFFICIENT
Global Oil & Gas Company Executives’ Future Plans To Invest In Digital Technologies Over The Next 3-5 Years
Source: Accenture, Microsoft, 2015
18%
0% 25% 50%
Don'tPlanToInvest
InvestTheSameAmount
More
SignificantlyMore
MANUFACTURERS ARE CURRENTLY SEEING THE MOST RETURNS FROM IOT INVESTMENTS…
Source: TATA Consultancy Services, 2015
0% 25% 50%
MediaandEntertainmentConsumerPackagedGoods
InsuranceAutomotive
UtilitiesHealthcareandLifeSciences
HighTechTravel,Transportation,andHospitality
RetailEnergy
TelecomBankingandFinancialServices
IndustrialManufacturing
Industries Seeing Largest Returns From IoT Investments% of respondents in their industry with 2014 revenue gains from IoT of > 30%
AUTOMATING THEIR PRODUCTION THROUGH INTERNET-CONNECTED ROBOTS
Estimated Global Industrial Robot Shipments
Source: IFR Estimates, BI Intelligence, 2014
-
250
500
2010 2011 2012 2013 2014 2015E 2016E 2017E 2018E 2019E 2020E
Installatio
ns(Tho
usan
ds)
AGRICULTURAL COMPANIES ARE USING SENSORS TO COLLECT DATA FOR PRECISION FARMINGEstimated Amount Of Data Generated By The Average Connected Farm Per Data
Source: Onfarm, BI Intelligence Estimates
-
2,500,000
5,000,000
DataPointsGeneratedPerDay
DOCTORS CAN REMOTELY MONITOR THEIR PATIENTS
PercentOfAmericansWithAWearableFitnessTrackerByAge
Source: Icontrol State of The Smart Home, 2015
0%
10%
20%
Total 25-34 35-44 45-54 55-64 65+
INSURANCE COMPANIES ARE TRACKING CUSTOMERS’ DRIVING HABITS FOR USAGE-BASED INSURANCE…
Estimated Number Of US Drivers Who Have Or Have Had Usage-Based Insurance
Source: Insurance Research Council, Tower Watson, NHTSA, BI Intelligence Estimates, 2015
-
30
60
2014E 2015E 2016E 2017E 2018E 2019E 2020E
Numbe
rOfC
onsumers
(Million
s)
AND ADOPTING IOT DEVICES RAPIDLY
Q: How far, if at all, has your company progressed with these IoT-related connected insurance initiatives?
Source: Accenture, 2014-2015
0%
50%
100%
2014 2015 2014 2015 2014 2015
ConnectedHome/Buildings
HealthandFitnessMonitors
OtherWearables
It'snotcurrentlyofanyinterest
It'satopicoffocus/discussionsbutwehavenoconcreteplansyet
Strategydefinedinthisarea
Wehavelaunchedpilotsorareintestphase
Wehavealreadylaunched,orareabouttolaunchproductsandservicesusingthesetechnologies
RETAIL STORES ARE USING BEACONS TO TRACK THEIR IN-STORE CUSTOMERS AND PUSH DISCOUNT OFFERS
$-
$25
$50
2015E 2016E
USD(Billion
s)
*Top 100 Retail Locations OnlySource: BI Intelligence Estimates, 2014
Estimated US In-Store Retail Sales Influenced By Beacon-Triggered Messages
UTILITIES COMPANIES CAN REMOTELY MONITOR THEIR CUSTOMERS’ POWER USAGE
Source: Pike Research, IBIS World, USITC, European Commission, Northeast Group, Ernst & Young, News Releases 2010-2015, BI Intelligence Estimates 2015
-
500
1,000
2014 2015E 2016E 2017E 2018E 2019E 2020E
InstalledBa
se(Billion
s)
Estimated Global Number Of Smart Meters Installed
THE POSSIBILITIES ARE ENDLESS
HOW ARE GOVERNMENTS USING IOT DEVICES?
AS THE URBAN POPULATION RISES…
Estimated Percentage of World Population Living In Cities
Source: UN Estimates, 2015
0%
35%
70%
1960
1963
1966
1969
1972
1975
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2008
2011
2014
2017
2020
2023
2026
2029
2032
2035
2038
2041
2044
2047
2050
WeAreHere
URBAN PLANNING FOR CONNECTED CITIES WILL BECOME MORE IMPORTANT
Source: Shutterstock
AND CITIES’ INVESTMENT IN THE IOT IS SOARING
Estimated Connected Cities’ Investment In IoT Systems Per Year
Source: BI Intelligence Estimates, 2015
$0
$70
$140
2014E 2015E 2016E 2017E 2018E 2019E
USD(Billion
s)
BY 2020, 6 BILLION IOT DEVICES WILL BE USED BY CITIES
Estimated IoT Device Installed Base for Connected Cities
Source: BI Intelligence Estimates, 2015
-
4
7
2014E 2015E 2016E 2017E 2018E 2019E
IoTD
evice
InstalledBa
se
(Billion
s)
WHICH CAN IMPROVE CITIES IN MULTIPLE WAYS
Source: Libelium
GOVERNMENTS ARE ALSO AUTOMATING THEIR DEFENSE
Global Spending on Smart Weapons
Source: Transparency Market Research, BI Intelligence, 2015
$-
$40
$80
2012E 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E
USD(Billion
s)
THROUGH DRONES AND ROBOTS
Global Shipments of Military Robots
Source: Frost & Sullivan, BI Intelligence, 2015
0
70
140
2012E 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E
Thou
sand
s
HOW ARE CONSUMERS USING IOT DEVICES?
THE SMART HOME MARKET HAS BEEN STRUGGLING TO TAKE OFF
North American Smart Home Device Penetration
Source: McKinsey, 2015
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Connected Smoke/CODetectorRemoteVideo
Connected LockConnected LeakDetectorConnected Thermostat
Connected LightingConnected EnergyTrackingConnected LawnSprinklers
VitalsDataUploadingConnected Scale
Elderly/ChildActivityUploadingConnected PillCase
ConnectedWasher/Dryer/DishwasherConnected Stove/Oven
Connected Refrigerator/PantryConnected Cleaning/Vacuum
Multi-RoomMusicSeamlessAudio/VideoPlaybackRoom ControllingHomeTheater
SecurityAn
dSafety
Utilitie
sManagem
ent
Wellness
Monito
ring
Smart
Appliances
Smart
Entertain
ment
BECAUSE THE DEVICES ARE TOO EXPENSIVE
2015AdvertisedPricesOfConnectedVs.Nonconnected HomeProducts
Source: Amazon, Sears, Nest, Walmart, Best Buy, Build.com, Sears, Home Depot
$250
$16
$250
$18
$200
$31 $25 $8
AugustDoorLock
MasterLock
NestTherm
ostat
Honeyw
ellB
asic
Thermostat
NestConnectedHom
eMonito
ringCamera
AstakW
iredSecurity
Camera
BelkinW
emo60WLight
Bulb
CreeLED
i60W
Connected Nonconnected
HOWEVER, THE CONNECTED CAR MARKET EXPLODED IN 2015
Source: Shutterstock
PRIMARILY BECAUSE AUTOMAKERS SEE MULTIPLE INTERNAL BENEFITS FROM CONNECTING THE CARS THEY SELL
1• CollectingDataGeneratedByTheCar
2• PushingOver-The-AirUpdatesToPreventRecalls
3 • ImprovingCarSafety
4• SellConnectedCarProducts&Services(e.g.apps,media,etc.)
How Automakers Benefit From Connecting Cars
AT&T CONNECTED NEARLY 3 MILLION CARS IN THE FIRST 9 MONTHS OF 2015
AT&TConnectedCarNetAdds
Source: AT&T Company Filings
-
600,000
1,200,000
3Q2014 Q42014 Q12015 Q22015 Q32015
NetA
dds
THAT’S 43% OF THE CARS THEIR 8 AUTOMAKER PARTNERS SOLD
AT&T Net Adds Vs. Total Car Sales Of 8 Partners
Source: AT&T Company Filings, Motor Intelligence, WSJ, Company Filings, 2015
-
1
2
3
4
5
6
7
AT&TPartners AT&T
Million
s
SubaruofAmerica
Volvo
NissanNorthAmerica
Tesla
BMWofNorthAmerica
AudiofAmerica
Ford
GM
THESE TECHNOLOGICAL ADVANCEMENTS WILL LEAD TO A SELF-DRIVING CAR
Global Self-Driving Car Shipment Forecast
Source: BI Intelligence Estimates, 2015
-
3
6
2015E 2016E 2017E 2018E 2019E 2020E
CarsShipp
ed(Tho
usan
ds)
RemoteValetAssistant
HighwayAutopilotWithLane-Changing
UserOperated
YearFe
ature
IsRe
leased
WHAT’S SLOWING THE IOT DOWN?
THE CURRENT INFRASTRUCTURE CAN’T HANDLE THE INTERNET TRAFFIC
NorthAmericaMobileDataTrafficForecastInPetabytesPerMonth
Note:Datatrafficprediction basedonaverageofCiscoandEricssonMobile DataTrafficforecastsSource:CTIA
0
1,750
3,500
2010 2011 2012 2013 2014E 2015E 2016E 2017E 2018E 2019E
THEREFORE, NEW NETWORKS ARE BEING INTRODUCED
Source: BI Intelligence THE IoT NETWORKS REPORT, 2015
ISP/ServerBase
Hardwire
TelcoWirelessNetwork
InternetModem
Gateway
Wireless Router
InternetNetworkDevices
Ethernet
Ethernet
Wi-Fi
Wi-Fi
InternetOriginationPoints
IoTDevices
MeshNetworking
NetworkSignalRangeLow
High
LongRange
Hardwire
ALL OF THESE NEW NETWORKS ARE CONFUSING TO BUSINESSES, GOVERNMENTS, AND CONSUMERS
Source: Shutterstock
THERE ARE ALSO 3 PRIVACY AND SECURITY CONCERNS
IOT DEVICES OFTEN LACK BASIC CYBERSECURITY PROTECTIONS
(I.E., STRONG PASSWORDS, ENCRYPTION)1.
IOT DEVICES GIVE CYBER CRIMINALS NEW AVENUES TO STEAL SENSITIVE DATA FROM
ENTERPRISES, CONSUMERS, AND GOVERNMENTS2.
STATE-BACKED HACKERS AND HACKTIVISTS CAN USE IOT DEVICES
TO DO PHYSICAL DAMAGE3.
THESE VULNERABILITIES HAVE BEEN BROUGHT TO LIGHT BY RECENT HACKS
Source: WSJ, 2014; WIRED, Engadget, 2015
AS A RESULT, IN 2016, WE EXPECT CYBER SECURITY INVESTMENTS TO RISE
EstimatedGlobalCybersecurityMarket
Source: BI Intelligence Estimates, 2015
$0
$80
$160
2015E 2016E 2017E 2018E 2019E 2020E
USD(Billion
s)
ConnectedCarWearablesConnectedTVMobile/NetworkPCsIoTDevices
AND DEMAND FOR CYBER INSURANCE IS SET TO EXPLODE
EstimatedGlobalAnnualCyberInsurancePremiumsWritten
Source: PwC, Lloyds, BI Intelligence Estimates, 2015
$0
$4
$8
2014E 2015E 2016E 2017E 2018E 2019E 2020E
USD(Billion
s)
EVEN WITH THESE BARRIERS THE INTERNET OF THINGS MARKET
WILL BE HUGE…
IN TOTAL, $6 TRILLION WILL BE INVESTED ON IOT SOLUTIONS BETWEEN 2015-2020
Estimated Global IoT Investment Per Year
Source: BI Intelligence Estimates, 2015
$-
$4
$7
2015E 2016E 2017E 2018E 2019E 2020E
USD(Billion
s)
Enterprise Government Consumer
THAT’S 1.25% OF THE GLOBAL GDP DURING THAT SAME TIME
Compounded Global IoT Investment vs. Compounded Global GDP (2015-2020)
Source: : World Bank World Development Indicators, International Financial Statistics of the IMF, IHS Global Insight, Oxford Economic Forecasting, BI Intelligence Estimates
$-
$100
$200
$300
$400
$500
$600
Compounded IoTInvestment Compounded GDP
USD(Trillions)
THAT $6T INVESTMENT WILL GENERATE A $12.6T ROI OVER THE NEXT DECADE
Estimated Global IoT Return On Investment
Source: BI Intelligence Estimates, 2015
$0
$8
$15
Compound Investment2015-2020 ROI2015-2025
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