Internet of Things Driving a Revolutionary Business Model For the Next Generation Embedded Market

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1 Internet of Things Driving a Revolutionary Business Model For the Next Generation Embedded Market Miller Chang Vice President, Embedded Core Group, Advantech The world is moving through an Internet of Things evolution, in which things are capable of digitally interacting with other things. Helped by the endorsement and promotion of market leaders, the Internet of Things (IoT) has become a vital emerging industry that is 1 AXIOM

2 highly valued and full of potential. In the Internet of Things era, enabled parking lots will guide you to unoccupied parking spaces, factories will automatically address production line issues, hotels may adjust temperature and lighting according to a guest s preference; making the whole city an intelligent city. The new ecosystem of Internet of Things is now shaping a revolutionary new business model for the next generation embedded market. The Tremendous Business Opportunity behind Internet of Things According to Gartner Report, in 2020, over 30 billion connected devices will be in use. Cisco has an even bigger projection driven by reducing the price per connection and the consequent rapid growth in the number of machine-to-machine (M2M) connections, Cisco expects the number of connected objects to reach 50 billion by 2020 (2.7% of things in the world). Morgan Stanley has an even more progressive prediction 75 billion connected devices around the globe, by [1][2][3] Gartner also predicts IoT product and service suppliers will generate incremental revenue exceeding $300 billion, mostly in services, in Another IDC report has even more stunning prediction, anticipating IoT technology and services spending to generate global revenues of $4.8 trillion in 2012 and $8.9 trillion by 2020, growing at a compound annual rate (CAGR) of 7.9%. [4][5] And this is just the beginning. Governments around the World are Driving IoT Development 2 AXIOM

3 Not limited to business, but governments around the world are driving IoT development. President Obama addresses IoT for rejuvenate strategic economics to Congress; European Unions raise Internet of Things An action plan for Europe ; Japan follows a suit to purpose i-japan National Roadmap, and Sensing China by PRC China. The Internet of Things is an overwhelming trend. "In the Internet of Things era, enabled parking lots will guide you to unoccupied parking spaces, factories will automatically address production line issues, hotels may A Key to IoT Business Success, Enabling IoT Value Chain & Ecosystem Partnership adjust temperature and lighting according to a guest s preference; making the whole city an intelligent city." The IoT trend is here. Yet, the IoT market is huge and the IoT infrastructure is complex, covering SoC/chip design, sensors/devices, systems/platforms, IoT clouds and web services, and every kind of vertical applications. A comprehensive business ecosystem requires active partner participation from various industry sectors and application fields. Therefore, the key to the future IoT business success will be the ability to shape the industry ecosystem through collaboration with key partners, all together forming an IoT Value 3 AXIOM

4 Chain. An IoT Value Chain is composed of industry-leading companies, in hardware and software, with pioneering technologies and know-how; together providing customers with the most comprehensive and integrated IoT solutions and services. Partner with Software & Hardware Companies for IoT-Centric Cloud Solutions The crucial part in the IoT era is to gather all the data around, so toptier companies are reaching towards important new partners to cowork on IoT products and solutions to shape a sustainable IoT infrastructure, which include critical components such as a wireless sensor network designed for fundamental IoT data transmission and collection. Alliance with System Integrators in Various IoT Applications A few top-tier companies on the market are reaching out to various system integrators to build their IoT applications. This is not only to develop a comprehensive IoT product series and IoT-centric Cloud solutions for system integrators, but also to provide IoT-based services to support and focus on the integration of various IoT devices, enabling system integrators to accelerate the design-in process. For potential customers in the IoT business, companies are aiming to refine internal talent-training while securing cooperation 4 AXIOM

5 from partners and third-party players because alliances and integration are the best strategies for developing a business ecosystem. Similarly, academia-industry innovation is also vital for developing better IoT solutions. ' the key to the future IoT business success will be the ability to shape the industry ecosystem through Value Chain.' Enabling IoT Connectivity collaboration with key partners, all together forming an IoT On the market, there are various network suppliers who are capable of providing services to help enable IoT connectivity. The first step to building IoT applications is to transform embedded devices to interconnected smart devices. These services should help enable IoT connectivity, offering wide range embedded gateways/nodes/sensors with IEEE , UHF RFID, SubG RF technologies and multiple sensor interfaces for data collection; with IoT-centered Cloud solution to connect, manage and control data from sensor, gateway, system and cloud layers for further big data analysis. Now in the IoT era, however, they will have to use cloud management to integrate systems. The major challenge system integrators face is the significant difference in cloud management strategies. Undoubtedly, large companies can develop their own solutions. The most difficult part of IoT services is the INTEGRATION of IoT devices. Partnership is the Key to Win in IoT Market Partnership is the key to winning in the IoT market. The IoT trend is moving quickly and this market is huge. In the future Internet of 5 AXIOM

6 Things world, the IoT infrastructure and devices are complex, covering SoC/chip design, sensors/devices, systems/platforms, IoT clouds and web services, and innumerable vertical markets. The key to the IoT business success will be the ability to shape the industry ecosystem through collaboration with key partners, all together forming an IoT Value Chain. In short, partner to win! [1] [2] [3] [4] [5] Internet-of-Everything-in-Motio_ Miller Chang Miller Chang serves as Vice President of Advatech s Embedded Core Group. Having joined Advantech in 2007, he has since then been in charge of the Embedded Firmware and OS development business. Mr. Chang has built the integrated central embedded software team for Advantech and has been an influential asset to the team for 8 years. Mr. Chang has an Executive M.B.A. from the National Taiwan University of Science and Technology. 6 AXIOM