Beyond the hype bringing the Internet of Things to life. Michael Hobbs June 23 rd 2015
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1 Beyond the hype bringing the Internet of Things to life Michael Hobbs June 23 rd 2015
2 Before all the numbers, some fundamentals A SET OF VERY BIG ISSUES: healthcare, education for all; performance of cities; the need to reduce vehicle emissions faster than populations adopt cars ENGINEERING GREATER RETURNS FROM REDUCED INPUTS: How do we increase crop yields with lower fertiliser inputs? How do we minimise the use of asthma medication and simultaneously minimise asthma incidents? THE ECONOMICS OF IoT ARE LOOKING GOOD 2
3 Between 20bn and 40bn connected devices by 2019 Estimates of Internet of Things Devices , Billions of Devices 45 BI Intelligence Gartner Harbor Cisco ABI Research IDC
4 Everyday physical objects are becoming uniquely identifiable and embedded with the ability to connect to other devices or networks 4
5 Four enabling factors are fueling the growth of IoT Decreasing cost in computing Over the last ten years Proliferation of smartphones Cost of Sensors 2x Cost of Bandwidth 40x Cost of Processing 60x 7.2B 1.7B (24%) 7.3B 2.8B (38%) WW Population Smartphone Penetration Ubiquitous connectivity In 2014 By 2019 Rise of cloud and big data In 2012 By % of mobile devices were IPv6 capable 15% penetration of 4G connections 54% of mobile devices will be IPv6 capable 26% penetration of 4G connections 2.8EB of data 16% in the cloud 40EB of data 37% in the cloud Source: IDC, Cisco Visual Index Report 5
6 We are witnessing strong signs of adoption 2014 IoT Stats Consumer Adoption Retailer Adoption Developer Adoption Industrial Adoption 109M global wearable users 3k ibeacon-enabled US retail stores 52k HealthKit enabled apps 17% of automotive companies using IoT for manufacturing Source: Worldometers, InternetLiveStats, Facebook, Tencent, Vkontakte, Yandex, GSMA Intelligence 6
7 Tesla responds to recall notice from US Highway Traffic Administration by updating the software in 29,222 cars over the air, overnight, without asking owners to bring their cars in, giving car owners the perception that they drive the car that fixes itself 7
8 GoldCorp tracks location of workers and assets in real-time, cutting volume of ventilated air from 1.2M to 650k cubic feet per minute, reducing energy bill by $2.5M/year 8
9 An A380 Airbus grounded awaiting maintenance or replacement parts costs an airline ~$1.25M per day; detecting faults in real-time and ensuring availability of staff and equipment before an aircraft needs to be grounded reduces overall maintenance costs by 15-30% or $500K-$1M per year per aircraft. 9
10 Connected Mine case study #IIoT
11 A $3T revenue opportunity by 2020 Worldwide IoT Revenue by Technology Split , USD Billions Worldwide IoT Revenue by Industry Sector , USD Billions $1,534 $1,752 $1,966 $2,211 $2,470 $2,749 $3,046 Analytics Platforms Services Devices Connectivity Intelligent/ Embedded Systems $1,534 $1,752 $1,966 $2,211 $2,470 $2,749 $3,046 Financial Services Infrastructure Manufacturing & Resources Distribution & Services Public Sector Consumer Source: IDC 11
12 What we are seeing in the market 1 IoT is the next era in computing 6 The amount of data generated by IoT is overwhelming 2 IoT is the next growth driver in the app economy 7 Making IoT work requires managing a complex stack 3 Beyond app-controlled things, the power of IoT is in making things talk to each other 8 It also means relying on a highly fragmented vendor ecosystem 4 To work autonomously, things rely on an increasingly sophisticated backend 9 If done right, IoT has the power to fuel growth over the next 15 years across industries 5 The vulnerability of devices is a top concern 10 Thus every business will become an IoT Business in the next 3 years 12
13 Typical problem statements for our clients ACHIEVE Operational efficiency MOVE FROM Product focus to service focus DISCOVER Unconventional revenues 13
14 Six critical actions to any IoT solution We think all IoT solutions must consider these six actions to be successful: Access & Secure Find & Track Enable & Manage Diagnose & Treat/Service Automate, Predict Monetize 14
15 Questions Michael Hobbs, Accenture
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