Business Potential from Industry Digitalization

Transcription

1 Business Potential from Industry Digitalization ITU Seminar: 5G Implementation in Europe and CIS Budapest 2-4 July 2018 Silvana Apicella Southern Europe Network Evolution Lead, Ericsson

2 5G Use Cases Massive MTC Critical MTC Very large # of device Very low device cost/power High density Wide coverage SMART AGRICULTURE LOGISTICS FLEET MANAGEMENT INDUSTRIAL APPLICATION & CONTROL TRAFFIC SAFETY & CONTROL REMOTE TRAINING Very low latency Very high reliability and availability SMART METER TRACKING REMOTE MANUFACTURING REMOTE SURGERY Enhanced Mobile Broadband Fixed Wireless Access Very High Data Rate Very High Traffic Volumes ENTERPRISE VR/AR Mobility HOME MOBILE/ WIRELESS/ FIXED SMARTPHONES BROADCASTING VENUES NON-SIM DEVICES 4K/8K UHD G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 2

3 5G Architecture x 1000x 5x 100x Cost 5x 3x END-USER DATA RATES MOBILE DATA VOLUMES LOWER LATENCY MORE DEVICES DEVICE COST REDUCTION NW ENERGY EFFICIENCY SPECTRAL EFFICIENCY Devices / Local NW Access sites Distributed sites Application cloud National sites Global sites Mobile Fixed Management & Monetization Network slices Access, Mobility, Network applications Cloud infrastructure Transport embb FWA mmtc cmtc G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 3

4 With industry digitalization, new fast growing revenue pools emerges USDbn CAGR ,5% Operator to seize emerging revenue potential ,6% Challenge: current operator service revenues Opportunity: digitalization revenues* * Digitalization revenues for ICT players from 10 key industries Source: Ericsson and Arthur D. Little G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 4

5 Of the total 5G enabled value in 2026, up to 47% is addressable by operators Digitalization revenues for ICT players USDbn, G enabled revenues Operator addressable revenues Service creator: % 47% Network developer: Digitalisation revenues for ICT players 5G enabled digitalization revenues 5G enabled digitalization revenues 5G operator addressable revenues G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 5 Source: Ericsson and Arthur D. Little

6 Operators share of the 5G value created Total 5G enabled revenue (USDbn, 2026) 1307 bn Connectivity and Infrastructure Provisioning Service Enablement Application & service provisioning Total 5G enabled revenue per value chain step Operator addressable share 230 bn 646 bn 432 bn 89% 52% 18% Operator addressable market for role Network developer Operator addressable market for role Service enabler Operator addressable market for role Service creator bn bn bn 337 bn 337 bn 79 bn bn bn bn Sum of addressable 5G revenue per operator role Source: Ericsson and Arthur D. Little Note: The total addressable market for operator role Service creator is the total operator addressable market G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 6

7 Current service revenues 5G addressable B2B2X 5G revenue potential for operators addressing industry digitalization USDbn, * Adding an addressable 36% revenue growth potential 2026 Service enabler and service creator revenue potential Network developer revenue potential *Total addressable as Service creator operator role G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 7

8 Current operator service revenues New addressable 5G enabled revenues Operator opportunity addressing Industry digitalization with 5G Current & 5G addressable revenues Split per Industry (2026) USD bn 2,500 Potential to add 36% growth in revenies in % USD bn 619 2,000 > , , Source: Ericsson and Arthur D. Little G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 8

9 Use Case clusters Cluster approach From industries to clusters From what to how Enables shared investments and resource allocation across a larger revenue pool Possible to prioritize opportunities depending on investment Increase scalability across industries G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 9

10 Current operator service revenues 5G enabled To grow with up to 36% operators can address 9 Use Case clusters USDbn, Global market X Service enablement and service provisioning value Connectivity and infrastructure value Total addressable as Service creator operator role Source: Ericsson and Arthur D. Little Real-time Automation Enhanced video services Monitoring and tracking Connected vehicle Hazard and maintenance sensing Smart Surveillance Autonomous Robotics Remote operations Augmented reality Other G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 10

11 Industries and Use Case Clusters G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 11

12 5G Use Case clusters +200 use cases in 10 industries Automotive Media & Entertainment Public transport Healthcare Financial services Agriculture Retail Energy and utilities Public safety Manufacturing Application based cluster methodology Go-to-market challenges Business and monetization model Value chain positioning Role in ecosystem Partnership development Enhanced video services Monitoring and tracking Real time automation Smart surveillance Autonomous robotics 5G Deployment challenges Technical performance criteria Role of 5G Device, network, computing and service enablers Hazard and maintenance sensing Augmented reality Connected vehicle G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 12 Remote operations Source: Ericsson and Arthur D Little

13 Go to market challenge Emerging 5G strategies Ambition level steers the ability to capture the value Low High Operator opportunity 2026 Smart Surveillance Real-time Automation Hazard and maintenance sensing Connected vehicle Monitoring and tracking Autonomous Robotics Remote operations Augmented reality Enhanced video services Easy to deploy Deployment challenges Difficult to deploy Source: Ericsson and Arthur D Little G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 13

14 Use Case deep dive Structure of the Analysis G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 14

15 Operators in all geographies of the world are embarking on their 5G journey Cluster Real time automation Monitoring and tracking Enhanced video services Hazard and maintenance sensing Market Connected vehicle Case study North America Europe & Latin America North East Asia Oceania & India AT&T (US) Fleet management solutions Verizon (US) Commercial drone solutions Ericsson (US) Conn. Urban Transport Telefonica-Vivo (Brazil) Smart grid Orange (Europe) Remote patient monitoring Telia (Sweden) Connected cars China Mob. (China) Condition-based maintenance Telstra (Australia) Connected venues Source: Ericsson and Arthur D Little G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 15

16 The Ericsson industry digitalization tool quantifies the 5G cluster opportunity Key inputs 1 Steering variables Outputs Main topdown market sizing Triangulation sources +36 industry market reports +400 digitalization use cases Proxy business cases Market reports sizing use cases ICT company P&L structure benchmarks ADL ICT and industry expert evaluation Selected bottom-up case study quantification sanity check Industry ICT investment benchmark Cluster Region/ footprint Operator role 5G Business tool Top down cluster calibration Bottom up use case calculations Currency Revenue potential per cluster Revenue Cash flow profile Cluster X Source: Ericsson and Arthur D Little Note: Other sources used include GDP forecasts, exchange rates, ICT development index etc. X% G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 16

17 Ericsson Studies and Analysis G Business Potential from Industry Digitalization - ITU-D Commercial in confidence Page 17 hts-and-reports/the-5g-business-potential

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