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THE INTERNET OF THINGS
Steve KoenigSr. Director, Market Research
Trends, Technologies, and Opportunities
Internet of Things is more than a trend.
It’s a connected revolution fostering a global shift in the way we live, work and play.
Industrial Revolution IoT Revolution
Technology’s Magnificent Seven
2017 Global Tech Spending = 81%754 Billion USD
2017 Global Connected Device Spending = 88%827 Billion USD
2020 - Gartner: 20.4 billion2020 - Cisco: 26.3 billion2020 - IHS Markit: 30.7 billion 2021 - Juniper: 46 billion2022 - Ericsson: 29 billion2025 - IHS Markit: 75.4 billion
Sources: Ericsson: Nov 2016 Mobility Report ; Gartner: 2017 Press Release; IHS Markit: Whitepaper, March 2016; Juniper: 2016 Press Release; Cisco: VNI Forecast
How many IoT devices worldwide?
DEVICES FUTURETECH
Devices represent the visible part of the IoT ‘spectrum’.
China Malaysia Vietnam Indonesia Philippines
#1
99% 99% 97% 98% 98%
#2Desktop
89%Laptop
93%TV
94%Headphones
95%Smartphone
96%
#3Laptop
88%TV
89%Laptop
94%TV
94%TV
96%
#4Digital camera
85%Headphones
80%Headphones
91%Laptop
94%Laptop
91%
#5Headphones
83%Digital camera
80%Feature phone
88%Feature phone
85%Tablet87%
APAC Region: Top Five Tech per Country*
Source: CTA Asia-Pacific Tech Adoption Study, May 2016 * Among Online adults
Smartphones: The Heart of IoT
61 38 24 14 11 9
260 352 379 401 431 432
17%21%
3% 3%6%
0%
-10%
-5%
0%
5%
10%
15%
20%
25%
0
50
100
150
200
250
300
350
400
450
2012 2013 2014 2015 2016fcst 2017fcst
Global Mobile Spending (USD bn)
390 402 416 442 441
321
Smartphones
StandardPhones
VPS 16 eye-tracking glasses
Gear S3 smartwatch Spartan Boxer Brief
Global Wearables Market In High Gear(Units in Millions)
26 45 66 8719
38
757
8
11
14
122%
58% 50%
0%
20%
40%
60%
80%
100%
120%
0
20
40
60
80
100
120
140
160
180
2014 2015 2016fcst 2017fcst
35
77
122
184
3Others Wrist Sport Computer Smartwatch Health & Fitness Tracker y/y Wearables
Digital Assistants: Personification of IoT
Today Tomorrow
Assistance Embedded
Lenovo Smart Assistant
C Lamp by GESamsung
Powerbot VR7000
NvidiaSpot
SomfyOne
C-WayMemoo
Alexa: Rapidly Moving Beyond Devices
Ford Motors ties up with Amazon’s Alexa LG Smart InstaView Refrigerator
Home Theater: Then & Now
15%
39%
42%
45%
55%
59%
62%
66%
71%
82%
Airplay-enabled
Support for other audio/video inputs (e.g., optical audio or S-video)
Built-in streaming services
Multi-room system capability
Number of HDMI inputs
USB connections
Wireless components (such as a wireless sub-woofer or surroundsound speakers)
Smartphone or tablet connectivity
Bluetooth-capable
Wi-fi-enabled
AVR Feature Importance: Connectivity
Source: CTA, State of the Home Audio Theater, October 2016
The Next Decade Now
5G Connectivity: Coming Soon•Higher speed, greater capacity, lower latency
•Potentially 40 times faster; some say 25-30 Gb/second
•Several wireless companies investing in development• Ingredient technology:
Smart CitiesWireless VR
Self-Driving Cars
5G:How fast is it?
5G Deployment: Trend Impact
•Key ‘ingredient’ technology•Much deeper impact than personal mobile device pursuits•Connected workforce•Smart Cities•New business models
Japan Targets 2020 for 5G Deployment
•2020 launch targeted by Ministry of Internal Affairs and Communication.
•Opportunity for Japan to market its 5G standards work to global community.
•R&D tests proceeding in Japan.
Two Approaches to Autonomy
• Evolution of singular ADAS features• SAE Levels 1 and 2• Automated Driving• Step-by-Step approach• Existing automotive strategy
• Future of Mobility • SAE Levels 3, 4 and 5• Self-Driving - No operator required • Requires advanced robotics and AI• Pursued by tech industry
Self-Driving VehiclesDriver Assist Technologies
The Evolution of Self-Driving Cars
2015 20202010 2030
Leve
l of A
uton
omy
2025 2035
Level 1
Level 4
Level 3
Level 2
Level 5Self-Driving
Cars
DriverAssist Tech
2040
Fully Autonomous Vehicle Driverless door-to-door
Active (control-based) ADAS SolutionsActive lane keeping, adaptive cruise control, automatic emergency braking, etc.
Highly Autonomous Vehicle Driverless in certain areas
Conditional Autonomy Full automation on a highway –driver required to resume control
Partial Autonomy Full automation within a lane
SAE Levels
Japan Wants Self-Driving Cars for 2020 Olympics
•Government to soon release guidelines. •Road tests of driverless trucks, taxis and buses planned for this year.
•Seen as key technology in Japan’s ‘graying’ economy.
A drone test conducted in Hyogo Prefecture last October.
Drones: Flying High
Drones: What’s all the Buzz?•Commercial / Industrial Uses explored in Japan.•2017 CES Trend: Object detection and avoidance•Drones and privacy: citizen concerns• Japan: TEPCO, Zenrin to develop drone ‘highways’ along powerlines.
Artificial Intelligence
•Beyond IoT – Adding Intelligence•Deep Learning
•Software learns from data (i.e., experience)
•Neural Networks•Processing devices from algorithms to hardware
•Japan’s Abe: No Fear!
Smarter than you think!
Terminator image
What can AI do?
This is a cable harness used for suspension bridges. All of three versions can carry the same structural loads and forces.
The machine learning designed version on the rightaccomplishes the same architectural goal but weighs 75% less.
Artificial Intelligence: Trend Impact
• AI will take on all kinds of tasks, such as those we:• Don’t care to do • Can’t do• Need all the help we can get
• Data as (artificial) brain food• Greater AI integration will generate societal impacts
Robotics in the Consumer Market
Hub Robot Lawn Mowing Robot
AirbotBlack and Decker Smartech Robot VacUbtech Lynx
Mayfield Robotics Kuri Leka LG Robots at CES
Witness the ‘Robotic Revolution’
From Honda’s Asimo … To Toshiba’s Aiko…
Robotics: Trend ImpactQuickly Moving Beyond Simple Tasks
•THEN: Task oriented: mowing, cleaning windows/floors, folding clothes etc.
•NOW: Service Oriented: Companion/Service Robots• Voice activated: Mobile and conversant with ability to take videos,
pictures, monitor home and in some cases make a purchase online.• Kid Friendly: Features to engage kids to learn and play.
•Robotics personify automation.
Smart Cities: The Next Big Thing
$14.85
$34.35
2015 2020e
2013 2016170 235
Global Smart City Programs
Global Spending on Smart Cities (Billions USD)
70% of the world's population forecast to live in cities by 2050
The Case for Smart Cities
•Urban centers increasingly difficult to monitor/manage•Better, more-timely information = better choices•Optimization of public safety and services•Reducing traffic congestion•Less pollution•Competitive economic advantages
Massive Challenges exist: Market-based, Organizational, Political leadership
Smart Cities: The Greatest Expression of IoT
• IHS predicts there will be 88 Smart Cities worldwide by 2025, with 32 of them in Asia.
• In the U.S. cities must cope with legacy infrastructure and other systems.
• Integrating digitally connected systems into city infrastructure creates new pathways for adversaries to exploit.
•Privacy and ethics issues on a massive scale
Biometrics: Evolution of Human–Machine Interaction
THE INTERNET OF THINGS
Steve KoenigSr. Director, Market Research@KoenigSteve
Trends, Technologies, and Opportunities
Smartphone Ownership
HH Penetration
80%+6pts
from 2016
HH Purchase IntentAvg. Units/ Owner HH
33%2.5Installed Unit Base238M
104 Million(2012)
238 Million(2017)
Installed Base Growth
Source: CTA, 19th Annual CT Ownership and Market Potential Study
Connected Consumer Devices ForecastU.S. Shipment Volumes (millions)
Sources: CTA Market Research, March 2017 Estimate. Connected products includes, in order of 2020 sales volume: Smartphones, Tablets, Fitness Trackers, Notebook PCs, Portable Wireless Speakers, Internet-enabled TVs, Bluetooth Headsets and hands-free car kits, Wireless Headphones, Home Gaming Consoles, Smart home systems, Streaming Media Players, Desktops, Digital assistants, Printers, IP/Wi-Fi cameras, Connected thermostats, Standard Cellphones, Smartwatches, Soundbars, Connected switches, dimmers and outlets, Smart locks and doorbells, Other Health and Fitness Devices, Pet Technology, e-readers, Connected e-toys, Smart smoke/CO detectors, Hearables, Blu-ray players, Aftermarket head units with Bluetooth audio, Action Camcorders, Portable Gaming Consoles, Wireless MRAV, Portable Media Players, VOIP equipment, 360 Cameras, Digital cameras, A/V Receivers with network/Internet connectivity, Home Radios with Internet connectivity.
Digital Assistants
1,7002,970
4,501
6,686
9,582
13,258
2015 2016 2017 2018 2019 2020
2017 U.S. HH Penetration
U.S. Volume Shipment Forecast
Smart Home Technology Devices
HH Purchase IntentAvg. Units/Owner HH
14%2.7Installed Unit Base 51M
2017 HH Penetration
+4pts from 2016
Includes lighting controls, door locks, motion sensors, etc.Excludes cameras and thermostats
Home Technology Products: Ownership
Home Technology Products % of U.S. Households Number Owner HHs
Installed Unit Base*
Avg. Units Per Owner HH
2014 2015 2016 2017 (Millions) (Millions) 2017 2016
Other smarthome device, such as lighting controls, door lock controls, motion sensors, etc.
-- 9% 12% 16% 19 51 2.7 2.0
Smart home security camera -- -- -- 14% 17 32 1.9 --
Smart thermostat 3% 5% 6% 8% 10 12 1.4 1.4
2017 U.S. HH ownership
Home Technology Products: Purchase Intent
Home Technology Products Households Planning to Purchase in 2017 % of HH Buyers
% # (Millions) Repeat 2017
First-Time1
2017First-Time1
2016
Other smarthome device, such as lighting controls, door lock controls, motion sensors, etc.
14% 16.66 42% 58% 64%
Smart home security camera 13% 15.47 28% 72% --
Smart thermostat 7% 8.33 11% 89% 83%
912191921
3243
77105
140
Digital assistant
Smart thermostat
4KUHD TV
Other smart home devices
Smartwatch
Smart home security camera
Fitness tracker
Digital media streaming device
Internet enabled TV
Portable wireless speakers
Smartphone 238
2017 IoT Product Ownership / Purchasing Stats:Multiple Consumer Technology Categories
• Audio technology • Video technology• Wearable technology • Home technology
U.S. household Installed base: In millions1U.S. household intent to purchase in 20171
33%
16%
16%
16%
14%
13%10%
14%
11%
7%
9%
Change in penetration between 2016 to 20171
+6%pts
+6%pts
+4%pts
+2%pts
+4%pts
N/A+4%pts
+4%pts
+9%pts
+2%pts
N/A
1CTA Consumer Technology Ownership and Market Potential Report, 20172 CTA estimate of Installed Base for 4KUHD TV and Digital assistant = Cumulative Unit Sales to date from CTA Consumer Technology Sales and Forecast Report, January 2017Ownership and purchase intent of digital assistant and smart home security camera were asked for the first time in 2017 Ownership and Market Potential study
2
2
Wearable Technology Product Ownership
Wearable Technology Product % of U.S. Households Number
Owner HHs Installed Unit Base
Avg. Units Per Owner HH
2014 2015 2016 2017 (Millions) (Millions) 2017 2016
Wearable activity fitness tracker 5% 11% 20% 24% 29 43 1.5 1.4Smartwatch -- 5% 8% 12% 14 21 1.5 1.4
2017 U.S. HH ownership
Source: CTA, 19th Annual CT Ownership and Market Potential Study
In-Vehicle Communication and Safety System
HH Purchase IntentAvg. Units/ Owner HH
9%1.5Installed Unit Base80M
2017 HH Penetration
Source: CTA, 19th Annual CT Ownership and Market Potential Study
Smart CityInvestments
In the U.S.
Indicates the seven finalists for theU.S. Department of Transportation’s Smart City Challenge (Dec 2015)
Smaller Screens = Bigger Viewing Profile
62%
51%
16%
21%
5%
12%
14%
8%
3%
7%
1%
2%
2012
2016
Television Smartphone Laptop Desktop Tablet Other
Source: The Evolving Video Landscape (2012)Source: 2016 Video Study Q3. What percent of your video watching is done on the following devices? Base: Online U.S. Adults (n=1,000)
Average Share of Video Viewing on Each Device
213,088
193,554
171,482
2015 2016 2017 2018 2019 2020
95,210
122,866
147,249 Smart Switches & OutletsSmart ThermostatsMedia Streaming DevicesSmart Home KitsHome Gaming Console Wireless HeadphonesInternet-enabled TV Portable Wireless SpeakersDigital AssistantsFitness Trackers
Top 10 Connected Devices ForecastU.S. Shipment Volumes (000s)Excludes ‘hub’ devices
Source: CTA Consumer Technology Extended Forecasts 2015-2020 (January 2017)
Global Consumer Tech Unit Sales Leveling Off(in Millions)
6,835 6,708 6,711 6,389 6,211 6,187
-1% -2%0%
-5%-3%
0%
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2012 2013 2014 2015 2016fcst 2017fcst
Units y/y
Today’s Battle for the Living Room?
3%9%
15%
24%
43%50%
54%
8%
19%24% 24%
29%34% 36%
2011 2012 2013 2014 2015 2016 2017Connected TV Media Players
U.S. HH Penetration Trend
Source: CTA, 19th Annual CT Ownership and Market Potential Study
Connected Video Products Ownership
$
54% HH penetration(+4pts from 2016)
36% HH penetration (+2pts from 2016)
1.7 1.8
105M 77M
16% 16%
Avg. Units/ Owner HH
Installed Unit Base
HH Purchase Intent
57
Connected TV Media Streaming Device
Source: CTA, 19th Annual CT Ownership and Market Potential Study
Nvidia’sAI CoPilot
Global Consumer Tech Spending(Billions of USD)
1,005 1,045 1,040955 950 929
-1%
4%
-1%
-8%
-1%-2%
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
0
200
400
600
800
1,000
2012 2013 2014 2015 2016fcst 2017fcst
Values (USD) y/y
ConnectedDevice Share
89%
$827Billion USD