IoT OPPORTUNITIES IN MALAYSIA: NEW ROLES AND NEW VERTICALS

Transcription

1 RESEARCH MALAYSIA TELECOMS SUMMIT 2017 BUILDING BLOCKS FOR SUCCESSFUL OPERATOR STRATEGIES IoT OPPORTUNITIES IN MALAYSIA: NEW ROLES AND NEW VERTICALS Sherrie Huang Research Programme Head, APAC Research division

2 Malaysia National IoT Strategic Roadmap Impact of IoT in Malaysia Mobile device penetration Internet users Mobile broadband penetration Social network penetration Mobile services revenue 143.7% 65.8% 13.3% 45% USD8 billion 280% 195% 167% 135% USD16 billion Three Goals Create an IoT industry ecosystem conducive to innovation. Strengthen technopreneur capabilities in applications & services layer. Make Malaysia the regional development hub for IoT. IoT in Malaysia by 2020 MYR1.7 billion in revenue Created new jobs 146 local patents to be exploited Source: MIMOS, MOSTI 2

3 IoT will bring new revenue and markets and increase scale, driven by strong demand and supply DRIVERS & ENABLERS Strong demand side: enterprise automation and innovation expansion of local businesses interest from MNCs and global telcos. Growing supply side: dynamic ecosystem telcos investing in IoT. Support from government: national policies and roadmaps, smart x s. IoT connections (fixed + mobile + LPWA ) in Malaysia by sector, 2015, 2020 and Source: Analysys Mason forecast, available at DataHub

4 Telcos in Asia Pacific face a number of IoT challenges and Malaysia has its own specific ones Challenges faced by operators building IoT businesses in Asia Pacific, and specifically in Malaysia? Some companies are cautious about new tech Risk of cyberattacks Local IoT ecosystems are still immature Source: Analysys Mason KEY ISSUES AND CHALLENGES Local regulation is often unclear or undefined No CSP has a region-wide network IoT strategy not fully developed 4 Strategies to help CSPs IoT alliances and partnerships help operators to increase their negotiating power and reach region-wide deals. Industry consolidation and collaboration helps build an IoT ecosystem and end-to-end capabilities. Success stories help educate and develop the market. Operators should understand and influence IoT regulations. Operators must learn globally and innovate locally.

5 All types of operators are offering connectivity to a range of vertical markets Overview of operator approaches to new vertical markets Clients Clients P P Hospital A Hospital B (e.g. secure cloud storage) Hospital C Hospital D (e.g. video conferencing) Vertical-specific market platform Healthcare 1 Company A Company B (e.g. diagnostics) Vertical-specific market platform Connected car Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) 5 Company C Company D (e.g. emergency services) End user A End user B (e.g. smart metering) End user C End user D (e.g. smart parking) Vertical-specific market platform Smart city Source: Analysys Mason

6 IoT connectivity: a mix of networks will be required, including low-power, wide-area (LPWA) networks Technology and related use cases 1Mbps+ (for example, 4G) ~100kbps (for example, 2G and LTE-M) <10kbps (for example, LoRa, Sigfox, NB-IoT) Smartphone CCTV Smart grid Smart watch Low-value object tracking P Smart parking Connected car High-value object tracking Smart meter Smart street lighting LPWA will account for 6.4 million IoT connections in Malaysia in 2025 Source: Analysys Mason 6

7 Case study: Connectivity in the retail sector Vodafone offered VeriFone network reliability It s important that we do everything we can to provide the most reliable service. Vodafone offered us the network reliability that we needed, worked with us to find the right commercial deal, and showed a willingness to develop a strong partnership. Ryan Philo, Head of Product at VeriFone

8 Vertical-specific opportunities Malaysia Telecoms Summit 2017 Vodafone meets VeriFone s requirements and seeks further opportunities to collaborate Vodafone s approach to retail vertical Shop A Shop B (POS solution Verifone) Shop C Shop D (Retail solution B) Vertical-specific market platform Retail Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) 8 Key (Indosat vehicle telematics) Own Partner Company A Company B Horizontal capabilities for all verticals (vehicle telematics) Bluebird Company D Vertical-specific Mix market platform Connected car Source: Analysys Mason

9 Operators with strong ambitions in the IoT market will need to consider offering more than connectivity Simplified value chain for IoT, with splits of IoT revenue in Malaysia and global EBIT margin, 2025 IoT revenue in Malaysia Hardware and installation MYR0.87 billion Connectivity and services MYR0.44 billion Applications MYR1.5 billion Percentage of total revenue 31% 16% 53% Global EBIT margin <5% ~10% 0 30% Total IoT revenue in Malaysia: MYR2.81 billion in Source: Analysys Mason

10 The next step is to provide generic capabilities Overview of operator approaches to new vertical markets Clients Clients P P Hospital A Hospital B Hospital C Hospital D Company A Company B Company C Company D End user A End user B End user C End user D (e.g. secure cloud storage) (e.g. video conferencing) (e.g. diagnostics) (e.g. emergency services) (e.g. smart metering) (e.g. smart parking) Vertical-specific market platform Healthcare Vertical-specific market platform Connected car Vertical-specific market platform Smart city 2 1 Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) 10 Source: Analysys Mason

11 Operators will need to offer vertical-specific capabilities to enter new markets Overview of operator approaches to new vertical markets Clients Clients P P Hospital A Hospital B (e.g. secure cloud storage) Hospital C Hospital D (e.g. video conferencing) Vertical-specific market 3 platform Healthcare 2 1 Company A Company B (e.g. diagnostics) Company C Company D (e.g. emergency services) Vertical-specific market platform Connected car Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) 11 End user A End user B (e.g. smart metering) End user C End user D (e.g. smart parking) Vertical-specific market platform Smart city Source: Analysys Mason

12 Case study: Platform approach for smart cities China Unicom s smart city platform for Shanghai China Unicom s announcements on Shanghai smart city Time Announcements Highlights July 2016 May 2016 July 2015 February 2014 Released end-to-end smart parking solution with Huawei at MWC Shanghai. 5-year agreement with Shanghai government. >300 NB-IoT vehicle detectors in the parking zone of Shanghai International Tourism and Resorts Zone. Inspired by the national Internet + strategy, China Unicom will work closely with industry players to provide integrated E2E IoT solutions for various fields and CNY14 billion (USD2.15 billion), 3K NB- IoT BTS Smart parking agreement with Smart parking, people flow management industries Huawei and Shanghai Shendi and smart wristbands; followed by 4K for Shanghai Disney resort. video, virtual reality and connected Dai Ling, vice president of vehicles. China Unicom (Shanghai) 3-year agreement with Shanghai government. >CNY10 billion (USD1.63 billion) 12

13 Vertical-specific opportunities Malaysia Telecoms Summit 2017 China Unicom is taking a platform approach and working with its partners to offer smart city services China Unicom s approach to the smart city market Key End users Smart metering Smart grid End users End users End users Own egovernment Solution 3 Smart parking Vertical-specific market platform Smart City Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) Solution 4 Transportation Partner Mix Horizontal capabilities for all verticals 13 Source: Analysys Mason

14 End-to-end solutions: gaps in end-to-end capabilities will require in-house development, M&As or partnerships Overview of operator approaches to new vertical markets 4 Clients Clients P P Hospital A Hospital B (e.g. secure cloud storage) Hospital C Hospital D (e.g. video conferencing) Vertical-specific market 3 platform Healthcare 2 1 Company A Company B (e.g. diagnostics) Company C Company D (e.g. emergency services) Vertical-specific market platform Connected car Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) 14 End user A End user B (e.g. smart metering) End user C End user D (e.g. smart parking) Vertical-specific market platform Smart city Source: Analysys Mason

15 Case study: An end-to-end approach in healthcare Telstra has made significant investments Instead of focusing on just one thing, like hospital electronic medical records, [we decided] let s go the big thing. There are six types of products, technologies let s take a position in each of them. Shane Solomon, Managing Director of Telstra Health Source: Australian Financial Review 15

16 Vertical-specific opportunities Malaysia Telecoms Summit 2017 Telstra is providing complete end-to-end IoT solutions for the healthcare market Telstra s approach to healthcare Clients Hospital A Hospital B (e.g. secured cloud storage) Clients GP A GP B (video conferencing) Vertical-specific market platform Healthcare Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) 16 (Indosat vehicle telematics) Own Partner Company A Company B Horizontal capabilities for all verticals (vehicle telematics) Bluebird Company D Vertical-specific Mix market platform Connected car Source: Analysys Mason Key

17 Case study: A mix of approaches in automotive Indosat is flexible in its approaches and partnerships Opportunity Indonesia: >16 million cars; million new cars per year; ~0.1 billion motorcycles REASONS FOR PARTNERING WITH WORLDWIDE PLAYERS Regional/global offices and partners. Success stories. Mature solutions with advanced features. Cover major parts of the value chain. Indosat has partnered with Ericsson, Giesecke & Devrient (G&D) and Gemalto. REASONS FOR PARTNERING WITH LOCAL PLAYERS Good local market knowledge. Capability and willingness to customise. Simple and straightforward solutions. A good fit for local requirements. Cost-efficiency. Indosat has partnered with Bluebird, Pointrek.net and Enerren Technologies. 17 Source: Analysys Mason, Indosat, Ooredoo

18 Case study: A mix of approaches in automotive Indosat is flexible in its approaches and partnerships Opportunity Indonesia: >16 million cars; million new cars per year; ~0.1 billion motorcycles REASONS FOR PARTNERING REASONS FOR PARTNERING WITH WORLDWIDE We have to PLAYERS work with a mix of WITH global LOCAL and PLAYERS local Regional/global partners offices in and Indonesia. But Good the most local market important knowledge. partners. thing is to find the right vertical Capability opportunities and willingness with to Success stories. customise. which to go to market with partners. Mature solutions with advanced Simple and straightforward features. Jürgen Hase, ex-iot Director at Ooredoo solutions. (Indosat s parent Cover major parts of the value company) A good fit for local requirements. chain. Cost-efficiency. Indosat has partnered with Ericsson, Giesecke & Devrient (G&D) and Gemalto. 18 Indosat has partnered with Bluebird, Pointrek.net and Enerren Technologies. Source: Analysys Mason, Indosat, Ooredoo

19 Vertical-specific opportunities Malaysia Telecoms Summit 2017 Indosat is building vehicle telematics solutions with its own end-to-end solution and those of partners Indosat s approach to automotive vertical Shop A Shop B (POS solution Verifone) Key Shop C Shop Own D Partner (Retail solution B) Vertical-specific market platform Mix Retail Platform of generic capabilities (for example, data centres and billing) Connectivity (2/3/4G, fixed, satellite, LPWA) 19 (Indosat vehicle telematics) Company A Company B Horizontal capabilities for all verticals (Vehicle telematics) Bluebird Company D Vertical-specific market platform Connected car Source: Analysys Mason

20 Recommendations 1 Telcos need to enter the IoT market now or risk missing their window of opportunity. 2 Operators need to be flexible in their approaches to IoT and choose to focus on the right verticals. 3 Operators should fill the gaps in their portfolios with M&As and global and local partnerships they must learn globally and innovate locally. 20

21 Leading operators in emerging Asia Pacific have strong capabilities and inspiring innovations Analysys Mason s IoT Scorecard 2017 provides an overall ranking of operators IoT businesses in emerging Asia Pacific. Register for the webinar now at: 21

22 Contact details Sherrie Huang Research Programme Head, Asia Sherrie Xiaoyu Huang Boston Tel: Cambridge Tel: +44 (0) Dubai Tel: +971 (0) Madrid Tel: Manchester Tel: +44 (0) Milan Tel: Dublin Tel: +353 (0) New Delhi Tel: Hong Kong Tel: Paris Tel: +33 (0) London Tel: +44 (0) Singapore Tel: linkedin.com/company/analysys-mason youtube.com/analysysmason analysysmason.com/rss 22

23 Research from Analysys Mason Clients across the breadth of telecoms, media and technology sectors rely on our research and analysis to inform business-critical decisions. 23

24 Consulting from Analysys Mason For 30 years, our consultants have been bringing the benefits of applied intelligence to enable clients around the world to make the most of their opportunities. To find out more, please visit 24