Greger Blennerud Head of Marketing, Mobile Broadband · Xperia Z5 (Sony) World first smartphone with 4K (2160x3840) display. Will be launched in this autumn. New capabilities increase

Greger BlennerudHead of Marketing, Mobile Broadband

Ericsson Mobility Report November 2016 Master presentation | Ericsson Confidential | EAB-16:019953 Uen, Rev A | 2016-11-11 | Page 2

7.5 billion Mobile subscriptions in Q3 2016


84 million new mobile subscriptions in Q3 2016

Top 5 countries by net

additions Q3 2016

1. India +15 million

2. China +14 million

3. Indonesia + 6 million

4. Myanmar + 4 million

5. Philippines + 4 million


More mobile subscriptions than people on earth


550 million 5g subscriptions by the end of 2022


90% of mobile subscriptions for Mobile broadband in 2022


90% of smartphone subscriptions on 3G and 4G


Mobile broadband key driver for subscription growth


25% of subscriptions in north America will be for 5G in 2022


3.3 billion volte subscriptions in 2022


Mobile traffic


Mobile traffic Q3 2016

Note: Traffic does not include DVB-H, Wi-Fi or Mobile WiMax. VoIP is included in data traffic


90% of mobile traffic from smartphones in 2022


Traffic for all application categories

growing, but their relative share of

total traffic declining as a result of the

stronger growth in the video category

Mobile video traffic to grow 50% annually to 2022Mobile traffic by application category CAGR 2016-2022 (percent)


Mobile video traffic will be increasingly dominant


The share of video traffic is approaching 60% on tablets


State of the networks


Mobile networks evolve with higher speeds towards 5g


5G estimated to reach 10% population coverage in 2022


Uplink and slow time-to-content


A minimum uplink speed of 300 kbps for a good time-to content


Live streaming joins social media


Live streaming spreading to new markets and users groups

Don’t do this and not interested in starting to use soon Don’t do this but interested in starting to use soon Already do this

Source: Ericsson ConsumerLab, Experience Shapes Mobile Consumer Loyalty study

Base: Smartphone mobile broadband users


Consumers expect high quality video experience


Growing usage will set more requirements on networks


Growth Codes -monetizing data


2015 Frontrunners


three Strategies to profitable growth

› End-to-end customer

experience focus

› Selective distribution & campaigns

› Segmented approach – often

utilize sub brands

› Fast followers on new products &

services

› Selected strategic partnerships

› High focus on market innovation

› One-for-all offerings and targeted

distribution

› First to market with new offerings

› Several strategic partnerships

› High focus on operational

efficiency

Offering-led Transfomation

› Selective customer experience

efforts & simplification focus

› Extensive campaigns & promotions

› Vast distribution network

› Rely on extensive high-quality

service portfolio & converged

offerings

› Few strategic partnerships -

extensive own VAS offering

Quality-led Progression Market-led Adaptation

Differentiate on

high-performing networks

and brand preference

Differentiate on

uniquely designed offerings

redefining customer value

Differentiate on

quick adaptation

to market conditions


the growth codes…Streetwise Metrics

Co-Partnering Unboxing

Showcasing

Eco-systematic

Gap Minding

Measure and Manage User Experience

Create Innovative OfferingsCreate Strategic Partnerships for Innovation

Market your Performance Leadership

Embrace Innovation

Create Performance Gap to Competitors

The Enabler

Measures for

sustainable growth


development per strategy

Offering-led transformation

Differentiate on being first to

market with uniquely designed

offerings

Quality-led progression

Differentiate on high-performing

network and brand preference

Market-led adaptation

Differentiate on quick

adaptation to market conditions

2013

20%

24%25%

20

2014

25

2015

56%

33%40%

5

2012

35%

12

67%20%

80%

# of Frontrunners


“Unboxing”

Redefine Subscription

Growth Code #4


Growth opportunities

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption

Enable Extend Expand Explore

Expose

network

capabilities

Time & Effort


1. Drive the adoption of smartphones

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities


› Verizon follows T-Mobile and

eliminates service contracts

› No contract, no device subsidy

– Devices now sold and financed separately

– Devices financing plans create customer

lock-in

Service contracts replaced by Upgrade plans

Service contract +

subsidized device

Service without

contract

Device with

upgrade plan

Stickiness now through device upgrade plans


› “Don’t get stuck with a phone you

don’t want!”

› Upgrade 3 times per year

› $20/month over 18 months

– No upfront cost

– No upgrade cost

Taking device upgrades to the next level


Xperia Z5 (Sony)World first smartphone with 4K (2160x3840) display. Will be launched in this autumn.

New capabilities increase requirements on speed

iPhone6s (Apple)Capable to take 4K video. (Display resolution is still 1080p)Launched on 25th Sept.

1,5 2,4

5

7,6

20Mbps

0

5

10

15

20

25

360p 480p 720p 1080p 4K

DL

Spe

ed

[M

bp

s]

610

20

30

80Mbps

0

20

40

60

80

100

360p 480p 720p 1080p 4K

DL

Spe

ed

[M

bp

s]

4K

4K

Target median speed for 90% Time-to-Content Guarantee

Target speed for 4s Time-to-Content

“4K experience” rely on a fast network


2. Capture the growth in data

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities


Transitioning from voice to data

Revenue growth

from voice

Decline in voice revenue not

offset by data growth

Usage and packaging aligning,

resulting in revenue growth

Revenue

Traffic

Voice era Transition era Data era


› Smallest monthly packages no less than ~1-2GB*

– Day/week packages (50 / 500MB)

› Hard Stops

– Force top ups and reduce customer care issues

– Automatic Top Up

› Transparancy

– Comfort drives usage

› Simplicity

– Ease of use when topping up

› Move towards family and multi device plans

– Increase usage and improve NPS and churn

Checklist for success

*) Some markets require even bigger buckets


3. Drive the need for speed and data

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities


Allow transfer of unused data – for a fee

Monetizedata twiceMobinil, Egypt


On line extras…

Extra Social…

“Get 30- or 60-minute all-you-can-use

4G LTE data sessions when you want

to go big without using up all your

data—only with the My Verizon app.”


Turbo boost revisitedputting a price on video data?

“Get 30- or 60-minute all-you-can-use

4G LTE data sessions when you want

to go big without using up all your

data—only with the My Verizon app.”


4. Drive more connected devices

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities


Consumers feel shared data offerings can helpThe figure below show the main reasons

for acquiring a new shared data plan.

Source: Ericsson ConsumerLab, Embracing data sharing, 2015

Base: Shared data plan users and intenders

20%

19%

12%

8%

7%

3%

2%

1%

1%

1%

1%

1%

1%

Save money by bundling

One data plan for all devices

Single bill for the family

Share allowance with family

Flexible plan

Share allowance with friends

Tailored offering including devices/people

Set quotas for data usage for each user/device

Allow temporary usage of plans

Track services/data used on different devices

Track data usage on devices

Track individual data usage

Set quotas for each user/device

Track services/data each individual use

23%


4 out 10 users indicate increase in mobile data usage

6 out of 10 in India and Brazil indicate increase in usage

Ever since they moved to shared data plans

51% consumers indicate increase in data capacity available to them

now!

Consumers buying more data in a shared plan than in individual plans.


Barriers to adoptionThe central barriers preventing some users

from taking up shared data plans are:

› Perceived higher costs

› The belief that sharing will lead to slower connection speeds


Base: Smartphone users in Brazil, India, Japan, South Korea, the UK

and the US, who are aware of shared data plans but do not have one


would replace their

Wi-Fi usage with a

SHARED DATA PLAN

if the cost was

EQUAL OR LOWERthan Wi-Fi combined

with an individual

subscription.

Existing shared data users are less inclined to replace Wi-Fi,

however intenders express a higher interest.

55%

Could Shared data replace Wi-Fi usage?


Base: Shared data plan users in Brazil, India, Japan, South Korea, the UK and the US

Shared data user Shared data intender


5. Drive the use of Content and apps

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities


› Netflix caps streaming at 600 kbps

› Controlled (sufficient) quality protects customers from exceeding data buckets

› Right-sized packages essential to keep video customer (and service providers)

happy

Netflix caps speed to keep customers in service

Source: Fierce Wireless


US operators competing with video offers

Verizon AT&T T-Mobile


New unlimited data offeringAT&T, US

› Only available to AT&T TV customers

› Unlimited talking, texting, data for

$100 per month

› Retained quality, but throttling may

apply after 22GB

“We've got the content consumers want, we're

delivering it to the devices they want, and we're

making it as easy as ever for them to consume as

much as they want. And, they will get a high-quality

video streaming experience from the start. No

compromises in video quality.“

Ralph de la Vega, CEO of AT&T Mobile and Business Solutions

AT&T Press release/ AT&T Newsroom)


Data consumption... Extreme variation

Segment size 25% 75% 5-15%

>>10 GB~0,5-4 GB<0,1 GBConsumption


Video only add on?

› Video – 20 GB or 20h

– 3$ only YouTube

– 5$ select 3

– 10$ any video

› Add on to existing Premium Plans

› Additional revenue targeting high Video Consumers

› Marginal cost per GB is a few cents...

› What is the Price Elasticity for high Video Consumption??


On line extras… social media

Monetizing the desire for Social

Media. Unlinking it from

standard package.

5 EGP/month for 0,5GB

Source: Orange Egypt


On line extras… youtube

Monetizing the capacity hungry

10 EGP/month for 1 GB high

speed YouTube, on top of

regular package.

Source: Orange Egypt


6. Expand into Adjacent Markets

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities


What is iot… to me?

All I need is connectivity!

And some gadgets…

And a few Apps

It’s primarily for FUN,

Safety and Convenience.

I may save some money in

the process…

The operator… well, I have

Fiber…


Iot maturity model

Vertical

Applications & Services

Service Enablement

Connectivity

Share of overall revenue

Flexible

Pricing, SLA,

Self-service

Connectivity

Provider

9-12%

Direct

Go-to-market

Vertical

Service

Provider

100%

White Labeling

Technology

To service

Providers

Powered

By Telco

Application

Service

Providers

60-65%

Application

Service

Providers

10-20%

Joint

Go-to-market

Telco

Reseller

Limited

Data plans

Wholesale

Provider

6-9%

Our experience with some Tier 1 MNO’s


› Complete smart home solution

based around home alarm system

– Basic 39,99$/mo,

– Automation 54,99$/mo

– Premium 64,99$/mo

Plus additional devices and functionality

› Reviews :

– Good products and functionality – sleek

interface

– BUT price is a showstopper

At&t digital life


The competitionTrojan horses?

Amazon Echo

”Music player”

Apple TV

”Entertainment Center”


› Today 50% of food ready for

harvest never reaches the

consumer’s mouth

› 90% of crop losses are due to

weather

› 25% of lost crops could be saved

with predictive weather technology

M2M solutions for agricultureVerizon

25%increased efficiency for farmers

Source: Verizon M2M solutions for agriculture


Microwave links as accurate rainfall measurement tools


› Hi3G microwave network

› Comparison rain gauges, weather

radar and microwave links

› Microwave links higher correlation to

rain gauges than the radar

8 month trial has validated the concept


Microwave links provide much better resolution than radar


connected ?

A connected cow!

Statistics and health status

on each individual cow

Quality and volume of milk

Benchmark vs other farms

Simplify’s life for the farmer!


> Telia supports mobile monitoring and control of

milking robots

– Tracks eating volumes and times

– Alarms if there are deviations from normal behavior

> Cattle can move freely and decide for themselves

when to milk, with improved quality of life

> Solution increases health and productivity

– Healthy cattle is more profitable

– Analytics and Statistics enable planning of production

Telia supports digitalFarming, Sweden

Mobility improves productivity –

with less effort


Starting up in iot…

Sim


The ”vertical” challenge

TIME

BUDGET

INTEREST


iot starter kit… at&T

• AT&T LTE SIM

• 300MB and 300 SMS for use over 6 months

• Avnet Cellular Shield and NXP MCU Board

• Two Pulse LTE antennas and Two MicroUSB Cables

• 5V Power Supply

• Quick Start Card

• and more...

99$ one time fee


Getting iot started… simple

Plug’n’play – press a button…

Web portal with rules engine

Motion, Position and Climate

Support 24/7

Possible to add additional HW, back end integration etc


7. Apply two-sided business models

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities


a connected car?

• With BMW Wi-Fi hotspot into the

high-speed Internet

• Now putting the eSIM into series

production

• LTE mobile telephony set for use in

BMW motorbikes too


Digital transformation and the connected car




Building blocks for an ecosystem…

Standardized and regulated

Available as consumer device

for as little as 30-40 € Attractive app

providing value to

consumerGood partners who

see value in the

service.


CONNECTING ALL CARS WITH TELIA SENSE• Adding high-end capabilities to your car without

changing anything.

• Telia Sense takes the hassle out of car

ownership and opens up a world of new

possibilities.

• Telia Sense is a new way to make almost any

car a more connected part of life.

• It has a range of exciting features that give

drivers more control, fast Wi-Fi and a more

enjoyable connected ride.

• With Telia Sense car, ownership will become

smoother, easier and more convenient.


Making life more convenientTelia Sense




8. Expose network capabilities

Data

centric

plans

Need for

speed and

data

Connect

more

devices

Promote

content

and apps

Target

adjacent

markets

2-sided

business

models

Smart-

phone

adoption


Expose

network

capabilities

Ericsson Mobility Report November 2016 Master presentation | Ericsson Confidential | EAB-16:019953 Uen, Rev A | 2016-11-11 | Page 87Ericsson Commercial in Confidence | Page 87Ericsson Commercial in Confidence | Page 87

Documents

Greger Blennerud Head of Marketing, Mobile Broadband · Xperia Z5 (Sony) World first smartphone with 4K (2160x3840) display. Will be launched in this autumn. New capabilities increase