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  • Slide 1
  • Surfing the Digital Consumer Wave in Technology Atiq Raza Chairman and CEO Raza Microelectronics, Inc. atiq@razamicroelectronics.com
  • Slide 2
  • 2 Theres wind and then there is a typhoon, there are waves and then theres a tsunami! Such a strategic inflection point [is] characterized by a 10X change Andy Grove Waves, Tides and Tsunamis There is a tide in the affairs of men, Which, taken at the flood, leads on to fortune; Omitted, all the voyage of their life Is bound in shallows and in miseries. On such a full sea are we now afloat, And we must take the current when it serves, Or lose our ventures. William Shakespeare
  • Slide 3
  • 3 Surfing the Technology Waves is Not Easy
  • Slide 4
  • 4 Digital Transformations Broadband Communication and Information Processing
  • Slide 5
  • 5 VCR to DVD: Digital Transformation
  • Slide 6
  • 6 Digital TV Shipments in Japan
  • Slide 7
  • 7 Cameras: Analog to Digital Transformation
  • Slide 8
  • 8 Digital Consumer Market
  • Slide 9
  • 9 Makimoto's Waves - Sony View of Technology Simplified Atiq plus original graphic Compute Processors Next Generation Processors Compute processors drove the first wave Running out of steam for the second wave
  • Slide 10
  • 10 Digital Consumer Lifestyle Study Master Bedroom Kids Bedroom TV Gateway Family Room Kitchen Copyright 2004. MIPS Technologies, Inc. All rights reserved. Home Minivans and SUV
  • Slide 11
  • 11 The Digital Consumer and the Digital Home Entertainment Passive with Higher Quality Experience Television, Music, Radio Interactive with Premium on Gratification Games, Browsing on the web Information Access Work Related Unrelated to Work Comfortable and Safe Living Environmental Control Security Remote control and management Minivans and SUVs gain Home Attributes Television, Music, Radio Gaming Cell Phone with rich features
  • Slide 12
  • 12 The Digital Home - Future Home Network Wireless (802.11 a/g/n/e, UWB) Wired (Ethernet, phone line, power line) Digital (DVI, HDCP, USB, 1394) RF (broadcast) Entertainment & Information Broadcast (RF) Multimedia content Rich experience Internet
  • Slide 13
  • 13 Consumers and Home Network Home is primarily a Languorous Interactive Environment Digital Content is much more Important than Home Automation Distributed Control TIVO, Environment, Security Systems Limited Automation and Autonomy in Home Controllers PC penetration in US Homes is 65% PC as Central Controller for Digital Home is less than 5% Driver for Home Networking is connecting multiple PCs Wireless Connectivity will be ubiquitous when it can deliver HDTV Ideal Control for Home will come through Learning Tools Global explosion in Digital Consumer Product Demand
  • Slide 14
  • 14 Global Economic Transformation
  • Slide 15
  • 15 Globalization Emerging Markets CHINA INDIA RUSSIA
  • Slide 16
  • 16 Chinas and Indias Growing Middle Class The Ansal Plaza shopping mall in New Delhi features a McDonalds and Nike, Reebok, Burberry's and Gucci brand products. This advertising- filled Shanghai street exemplifies the growth from China's economic reforms.
  • Slide 17
  • 17 Semiconductor Revenue Shipments by Geography Source: SIA
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  • Slide 20
  • 20 Richness of Experience Drives Customer Demand Content sustains Customer Demand Standards propel proliferation MP3, MPEG, 802.11, VHS, etc. Standards enable multiple Vendors and Brutal Competition Consumer Products have enabled Affordable Usage Model Digital Camera chips, 802.11, Bluetooth Overall winning model is the Razor-blade model DVDs, Digital Gaming Systems, Digital Cameras, Inkjet Cartridges, Cable/Sat TV Consumer Content and Services create Profits as Dessert EBay, Google, Sony, Movies, Music, Games Opportunities for Start-up wins in Consumer Products Atheros, Cambridge Silicon Radio, Portalplayer Digital Consumer Market Economics
  • Slide 21
  • 21 Market Segments defined by Product or Service, Technology, Sales Channels, Customers Large Companies Goliaths have Franchises but cannot react rapidly to Market Changes Start-ups have to offer Disruptive Products that are Aligned with Emerging Market Requirements Start-ups can only be Successful by Product and Sales Execution in Target Segments Start-ups Grow by expanding to Adjacent Segments Market Segments defined by Product or Service, Technology, Sales Channels, Customers Large Companies Goliaths have Franchises but cannot react rapidly to Market Changes Start-ups have to offer Disruptive Products that are Aligned with Emerging Market Requirements Start-ups can only be Successful by Product and Sales Execution in Target Segments Start-ups Grow by expanding to Adjacent Segments Start-up Opportunities and Market Segments Goliaths with Franchises New Product Emerging Market Directions Adjacent Segment Adjacent Segment
  • Slide 22
  • 22 David and Goliath
  • Slide 23
  • 23 Nasdaq Tsunami was Followed by Undertow January 1983 - Present Doubles in 8 years Doubles in 4 years Doubles in 2 years Doubles in 1 year
  • Slide 24
  • 24 Venture Investments
  • Slide 25
  • 25 Waves and Riptide Co-Exist
  • Slide 26
  • 26 Where VCs are Investing Forbes Nanotechnology PC-TV-Web Convergence Open Source Software Medical Devices Software-Hardware Integrated KPCB Focus Personalized Medicine Consumer Devices and Services Wireless Devices and Services Clean Power, Water and Transportation The New Enterprise Sequoia Components Systems Software Services Benchmark Enterprise Software and Services Communications and Security Semiconductors Mobile Computing Consumer Services Financial Services
  • Slide 27
  • 27 Innovation + Rapid Execution = Success Improvements Breakthroughs Goliaths Start-ups Rapid Execution Innovation Focus Creativity
  • Slide 28
  • 28 Sources of Technology Innovation
  • Slide 29
  • 29 Cost-Effective Innovation on a Global Scale Integration
  • Slide 30
  • 30 Recipe for Success Identify Emerging Opportunities WiMax, UWB, HDTV, Enhanced Media over WiFi, etc. Develop Jaw-dropping Value Proposition through Innovation Develop a Strategic Base of Support for Product Large Customers, Major Technology Partners Place emphasis on low Cost-of-Goods Cost-effective Product Development Global Markets Flawless Execution to intercept Emerging Opportunity Price the Products to enable Rapid Growth Surf the Huge Digital Consumer Wave
  • Slide 31
  • 31 Technology Waves Successful Surfer