© 2019 IHS Markit. All Rights Reserved.© 2019 IHS Markit. All Rights Reserved.

From AI & IoT to Cloud & 5GTransformative technology6 June 2019

Tom Morrod

Chief of Research – Consumer Technology

IHS Markit

© 2019 IHS Markit. All Rights Reserved.

Big technology ideas can drive exponential change

Connectivity

Blockchain

Robotics

Computervision

Ubiquitousvideo

IoT

AI / ML

Cloud

Speed of change

Impa

ct o

n in

dust

ries

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Convergence of transformative technologies accelerates change

3

As different transformative technologies come together, impact goes from linear to exponential

Connectivity + IoT + Cloud + AI/ML Predicting what the network will be doing

Connectivity + IoT + CloudStoring what the network was doing

Connectivity + IoTInformation about the network

ConnectivityCommunication over a network

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We see this trend in smartphones

4

0

200

400

600

800

1000

1200

1400

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Global smartphone shipments (m)

Global smartphone shipments (m)

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Several technologies converged before the market took off

5

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Displays + SoCs + antennas + OS

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Several technologies converged before the market took off

6

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Displays + SoCs + antennas + OS + apps

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Several technologies converged before the market took off

7

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Displays + SoCs + antennas + OS + apps + data

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We see the same thing happening with Fintech

8

-

10

20

30

40

50

2012 2013 2014 2015 2016 2017

Fintech industry ($bn)

Fintech industry ($bn)

Smart cards + ecommerce + smartphones + cybersecurity

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We see the same thing happening with Fintech

9

-

10

20

30

40

50

2012 2013 2014 2015 2016 2017

Fintech industry ($bn)

Fintech industry ($bn)

Smart cards + ecommerce + smartphones + cybersecurity

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1. Industries start to overlap and blend• consolidation across device makers or across access,

communication, entertainment and utilities

2. Technology developments ripple out further• reach across auto, device makers and telcos

3. Each new development pulls industries together• device technology in cars converges supply chain

IoT

AI

Connectivity

Blockchain

Ubiquitous Video

Robotics

Cloud & Virtualization

Computer Vision

Why is this important?

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Telco digital transformation projects fit this model

To better compete with established internet companies and create new business models, the telecommunications industry is adopting and deploying software technologies that infuse agility into services and automation into operations.

25%

38%

44%

75%

0% 20% 40% 60% 80%

NetworkVirtualization

Cloudification

Automation

CustomerExperience

Top three telco digital transformation projects

Source: Service Provider Digital Transformation Strategies: Service Provider Survey, May 2018

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2025 & Beyond

Unrelenting data traffic growth drives architectural changes

and capacity upgrades for fixed & mobile networks

Network software increases in importance. SDN & NFV help to drive the

“cloudification” and automation of SP networks, reducing opex and capex

Increased network automation is a precursor to new on-demand services

and self-driving and intent-based networks to address increasing

operational complexity

New services & business models become scalable

2020-20252015-20202010-2015

Connectivity trends lead to network management leads to new functions

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The automotive industry is starting to undergo similar trends

The automotive industry is rapidly moving from connected cars to autonomous vehicles. Companies like GM, Uber, and Tesla are pushing the boundaries of what is possible with connectivity, cloud, and AI.

0

20

40

60

80

100

120

140

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Ship

men

ts (M

)

In-car AI & deep learning systems (millions)

Infotainment (Speech)Infotainment (Gesture)Infotainment (Assistant)

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2025 & Beyond

Car becomes technology platform &

data nodes

Connected car generates & consumes

big data

Autonomous transportation starts to

become a reality

Transportation industry undergoes paradigm

shift

2020-20252015-20202010-2015

Autonomous driving is the long-term paradigm shift

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Digital assistants are just starting to find utilization

The new battleground for the consumer is digital assistants, with Apple, Amazon, Google, and Microsoft all working to integrate the smart home and mobile ecosystems utilizing cloud, connectivity, and AI.

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2025 & Beyond

Broadband access and WLAN provide a strong foundation for

consumer connectivity

Proliferation of connected consumer devices—trend to cloud profiles for

most consumersPush for increased

intelligence to anticipate consumer needs

Challenge is to enable robust ecosystems while securing

consumer information

2020-20252015-20202010-2015

Anticipating and responding to consumers is the next frontier

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The more places we look the more opportunity we see

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A couple of trends: Video Everywhere

18

OTT VideoTV

Drones

Auto Smartphone

ANPR

Digital Signage

Video surveillance

AR/VR Live streaming

Home security

Networks

Driving forces • The rise of online offerings and platforms, including new market entrants• Penetration of mobile connected devices that capture and display video• Advances in network and transmission technologies for sharing video• The explosion of user-generated content and social video

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A couple of trends: The Edge

19

Driving forces • The top edge application is video content delivery• Real-time or lower latency for time-critical workloads or safety applications• Resiliency for situations where the network connection is not optimal or offline• Data aggregation and the ability to filter: balancing storage, networking, and compute• Security and privacy functionality centralized and enhanced

Object tracking, Video Surveillance, AI/ML.

IoT, 5GInformation flow through multiple edges

Smart CO = Local caching and mission critical

DC Near CO = Immediate localized cloud

DC Not Near = Traditional cloud

EdgeCloud Gaming,

AR/VR, Healthcare

Partial edgeSmart Cities, vCPE,

AI/ML, loT

Cloud/data centerContent Delivery,

Amazon Prime, Netflix

20msecs

Edge devices: Immediate data

processing

UCPEDigital assistants UCPE

Digital assistants

loT G/W

loT G/W

V2X, ADAS

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Driving forces • The ability of machines to become more independent and autonomous• The explosion of collectable and analyze-able data through numerous platforms• High-performing electronics able to elaborate huge amounts of data and extract structured knowledge• Availability of adjacent transformative technologies creating the perfect storm: IoT and cloud

A couple of trends: Artificial Intelligence (AI)

20

Factory

Hospital

Video Surveillance

Car

Home

Data Centre

Enterprise