1WINTER 2015 INSIGHTS

TABLE OF CONTENTSPreface 3

1. Autonomous Vehicles 4

2. Media 8

3. Smart Homes 12

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PREFACEThe Queen’s Technology and Media Association strives to bridge the gap between the industry and the Queen’s School of Business. As a completely student run organization, QTMA works hard to ensure that Queen’s is being represented globally in these exciting fields. The club is made up of students of all ages, who are working towards a common goal of pushing Queen’s forward. The organization has been built upon three standing principles of connecting with industry, educating students with programming skills and creating presentable research material.

QTMA proudly presents this research package as the result of diligent investigation into autonomous vehicles, media and smart homes over the winter of 2015.

Sincerely,

Justin Herlick Co-Founder

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1. Autonomous Vehicles

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WHAT ARE AUTONOMOUS VEHICLES/TECH-NOLOGY

Autonomous vehicles are undoubtedly one of the hottest new advancements in technology that

will change the world before we know it. In concept autonomous vehicles are quite simple, any vehicle that possesses some ability to ‘drive itself’ can be considered to be autonomous. This loose definition is given as we already see some autonomous features in vehicles on the road today, like Ford’s Active Park Assist. While these vehicles may be easily defined and imagined, the technology behind these sci-fi vehicles is much more complex.

A combination of video cameras, radar, light distance ranging and other various sensors are used to enable the vehicle’s autonomous technology. Besides the cars internal sensors, the vehicles are also equipped with car-to-car communications (C2C) and car-to-infrastructure communications (C2I). With the combination of the vehicle’s external and internal sensing and communication abilities the vehicle is able to make a map of the world around it and safely travel alongside traffic. The technology is so precise that after several years of traveling California Google’s driverless car has yet to suffer an at-fault accident. An added benefit of the C2C and C2I communications technology is the ability of autonomous vehicles to coordinate and streamline travel to greatly reduce traffic.

THE AUTO INDUSTRY

The Auto Industry is comprised of three major players: hardware specialists, software specialists and in-car content specialists. Hardware specialists manufacture the physical portion (engine, transmission, seats) of an automobile and currently comprise an astounding ninety percent of an automobile’s value according to the industry’s current revenue model. Software specialists regulate the functions (human machine interface, blind spot detection, automatic braking systems) of a car and account for the final ten percent of revenue. In-car content specialists create advanced infotainment systems and other forms of media to enhance the passenger’s experience. The rise of autonomous technology will transform the revenue model into sections where hardware and software specialists comprise forty percent and in-car content providers form the remaining twenty percent. This new valuation ensues from the rise of software-related autonomous features, which create

a new revenue stream for third party technology companies to develop advanced in-car applications for consumer’s entertainment, productivity and functionality. ADOPTION

The adoption of autonomous cars can be divided into two broad markets: developed markets and emerging markets. Although it is expected that autonomous cars will eventually achieve mass adoption in both markets, the ways in which they will likely penetrate each market differ.Within developed markets, autonomous cars have a clear path to adoption due to the presence of more developed infrastructure present in developed countries. Put simply, there are more miles of roadway in developed markets than in emerging markets, so autonomous cars will be able to cover more area. Although the infrastructure advantages that developed markets hold, adoption can still be stagnant in these markets. Most consumers already own cars and are therefore less likely to purchase a new car with autonomous features.

In comparison to developed markets, adoption in emerging markets is less predictable but will likely have a much greater impact on society. There are several compelling reasons favoring adoption in these markets. Emerging markets are generally much faster to adopt new technology--as was seen in the past with global smartphone adoption--because there are fewer legal and government roadblocks, as well as newer infrastructure in certain recently developed areas. The improved safety of autonomous cars stand to make a much larger social impact in developing countries with less strict driving standards and laws that cause more traffic-related deaths. Finally, whereas the consumer market for cars in developed markets is already fairly saturated, there is a growing base of middle class citizens in emerging markets with the financial means to purchase autonomous cars.

IMPLICATIONS Autonomous vehicle technology raises political, social and economic implications. Political implications revolve around the laws, yet to be established, regarding the legality of autonomous vehicle technology in global markets. The social benefits behind this technology include faster travel time, less accidents and capabilities for disabled individuals to travel in their own autonomous vehicle. Economic incentives for the automotive industry have been

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estimated at over one billion dollars. Autonomous technology will improve total fuel, accident and congestion avoidance savings and raise passenger’s productivity level. Inevitably, negative consequences accompany autonomous technology as it accompanies cross-industry repercussions. A decreased spending on alternate forms of transportation (train, bus, taxi) will transpire due to luxurious benefits from driving an autonomous vehicle. Specifically the taxi industry will be threatened as autonomous vehicles give owners the opportunity to be dropped off and picked up from a location as the car manages to drive and park itself. Lastly, the radio industry is likely to be harmed as a result of new in-car content that will become available when drivers are not required to remain behind the wheel.

OBSTACLES

When examining the path toward widespread adoption, there are currently five broad categories of obstacles limiting the rate at which autonomous cars can gain popularity:

1. Consumer Acceptance - according to recent surveys, only 1 in 2 drivers in developed markets are comfortable being inside an autonomous car or sharing the road with one. There is a higher percentage of acceptance in emerging markets, but nonetheless it is expected that all markets will steadily become more comfortable with autonomous cars as the technology is further tested and understood.

2. Cost - each stage of the adoption will add several thousand dollars to the retail price of a car. Car manufacturers believe that consumers will be hesitant to pay these added costs, despite the economic and social benefits gained--as consumers are already less inclined to buy more expensive fuel-efficient even with the fuel savings in the long run.

3. Technology - the sensors and computer systems behind autonomous cars have been thoroughly tested under normal weather conditions, however their reliability under adverse weather conditions, like heavy rain or snow, is much more doubtful. Car manufacturers must invest more time and money developing their autonomous cars technology before they can be implemented in the mass market. Additionally, manufacturers must also design a foolproof system that would allow a driver to safely take back control of the car in

emergency situations.4. Legislation - even with advanced autonomous

driving technology currently in existence, car companies still face legal obstacles in major markets, particularly the United States. Only a few states have laws allowing autonomous cars on public roads, but companies are continuing to lobby congress for support. It is predicted that most states will pass relevant legislation within the next few years, opening up the potential for accelerated mass adoption.

5. Security and Liability - recently, there have been instances of hackers gaining access into modern car computer systems and controlling the car’s locks, engine and other computer systems. These hacks all require physical access inside the car, however, so the security risk is low since it is unlikely that hackers would be able to gain access to autonomous car networks remotely.

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2. MEDIA

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MOBILE COMPUTING

Mobile computing has evolved throughout the new millennium – from devices empowering business executives such as early Blackberries to devices that enable communication en masse for the greater half of the world’s population. Not only have devices developed, but so has the networks that connect them and what they enable. In some areas, desktop computing has had little ability to grab on whereas the prevalence of mobile continues to skyrocket. In the future, there will be repercussions of this shift from a business standpoint in the consumption patterns of people in the developing world – mobile technologies will enable a higher level of connectivity and present business opportunities for companies that are willing to invest in markets where mobile infrastructure will develop rapidly.

CATALYSTS

Driving this change is the low cost of mobile devices, with a consistent decrease in cost and increases in the computing power of handheld devices to the tune of 2x every two years. This trend prevails in the developing markets, however, this may not be apparent to North American consumers that are faced with iPhones that retail for up to $1079 USD. Consumers in Asia and Africa often do not have phones subsidized by service providers and have, on average, lower disposable incomes. This leaves the onus of procuring smartphones on the end consumer themselves, thus driving down the price of value oriented handsets. With the cost of mid-range smartphones from lesser-known manufactures such as Google‘s Android One priced at $100 USD in developing markets, there is little that prevents markets with low average incomes to access the internet and media. Although there is a clear gap in performance, the trickle-down effect is expected to occur and allow even low-cost smartphones such as the $45 Karbonn A50S to deliver a friendly experience.

Smaller and lesser known microchip manufacturers such as MediaTek are enabling this revolution. In the future, it can be expected that MediaTek and its competitors will have a larger share of the mobile chipset market due to a desire for low-cost solutions and greater access to communication technologies. Unlike Qualcomm, which manufactures the strongest performing system on chip (SoC), companies such as MediaTek are willing to power smartphones at much lower prices. Without digressing overtly, a SoC is an

entire mobile chipset located in a single chip allowing for greater efficiency. This appears to indicate that the computing power and experience of low-end smartphones will vary vastly from those of high-end makes. However, it is expected that low-end devices will soon boast very similar features and specifications when compared to high-end smartphones. It is predicted that MediaTek’s development of a strong SoC will enable budget smartphone manufacturers to increase their appeal to consumers by offering greater battery performance. With continued research and development in a field that Qualcomm has led for the past decade, budget mobile SoC producers may be able to compete with Qualcomm beyond simply price.

Next, the standardization and market dominance of free open-source mobile operating systems (OS) will enable the low-cost handsets to use the same interface and application environment as flagship devices. Moreover, the hardware requirements of operating systems have changed little relative to the quantum leaps forward made by chipset manufactures. This means that new handset manufacturers will be able to compete in the highly-commoditized budget smartphone market without significant research and development overhead. Thus, it is predicted that better and cheaper budget handsets will become commonplace and perhaps further in the future we can see budget smartphones being driven down to the cost of producing them.

Beyond the smartphone itself, the speed and bandwidth of networks are also growing at incredible rates. As of recent, there have been more attempts to reach rural areas and connect the developing world using mobile telecommunications. Large multinational tech companies such as Google and Facebook are already trying to blanket the developing world with internet access. It is expected that many companies with the capital to complete projects on such a scale will attempt them. This will give such companies the ability to become the first mover and set the precedent for internet development in less-populous regions where traditional tower infrastructure may not be suitable. Current projects include Google’s Project Loon and Facebook’s internet.org to deliver high-speed internet to developing nations. It is expected that there will be leap-frogging, similar to that of developing countries skipping landlines – albeit, in this case, there may be no cell towers but simply low-orbit satellites.

Lastly, it is predicted that investment by multinational enterprises will help fuel the expansion of mobile

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technology as there is a need for increased users. With a limited audience and staggering growth rates in the North American markets, companies such as Twitter and Facebook have incentives to acquire users from low ARPU generating parts of the world. With continued development of infrastructure, enabling more and faster communications, companies that invest have the ability to tap into another market and grow along with the market. This will give large enterprises more headroom to grow when compared to the relatively stagnant North American and European markets.

IMPLICATIONS

QTMA predicts that there will be a phenomenal increase in global high-quality media consumption. It is expected that high-resolution videos and auto-playing ads will be commonplace in the developing world. This indicates two outcomes: it may be possible for media/film producers (i.e. Lionsgate Entertainment) to expand their offerings to developing markets via a freemium model and provide a substantial amount of additional revenue for social networks and other advertising networks located in the developing world. This is because the increase of bandwidth and speed will allow for the dissemination of richer forms of media; and richer forms of media, from an advertising perspective, is more valuable per impression than static images or text based advertising.

It is also predicted that there will be a sharp movement away from text-based applications in the near future. Already, the available applications for mobile devices in the developing world are becoming more and more advanced, as developers vie to lead the way in these new enterprises. Facebook is taking a leading role in this process, recently coming out with a Facebook Lite, a stripped down version of their current app for Apple and other high-end Android devices. The new app is specifically targeting users in developing countries that have lower end Android phones, which are predominantly used in many East Asia and Southern American countries. The app will only be available in a handful of countries, including Bangladesh, Nigeria and Sri Lanka, and supports Internet connections as low as 2G, and is designed to work in areas will relatively poor connectivity and availability. As the buying power of developing nations becomes greater, companies will continue to devote a vast amount of capital into expanding and integrating themselves into these countries.

As mobile technology becomes more readily available in developing countries, the number of global internet users will increase dramatically. This majority of this rise is going to be a result of new internet users in developing countries, which brings with it massive opportunities for entrants into this new market. Already, the number of developing world Internet users exceeds the number of developed world Internet users, and this gap will continue to widen at an incredible pace. With this comes the potential for a variety of opportunities, from the opportunity for new entrants into the phone manufacturing industry, to mobile healthcare, to payments. Currently, the global cellular baseband processor market is dominated by Qualcomm, who have held the dominant share in this market for the majority of its existence, with a 66% share as of 2014. However, other players in the market have begun to make a move on Qualcomm, spurred by the incredible potential that is available for new entrants in the phone-manufacturing industry. Currently second in the industry, MediaTek with a 15% market share, has shown the greatest desire to expand their range in the manufacturing market. Their current plan is to focus on bringing 4G LTE services to as many individuals as possible, and more importantly, lower the price of their processors while still retaining the quality and durability. This strategy could produce success for MediaTek if successful, especially if they are able to capture a greater percentage of the growing market in developing countries.

More of the world is becoming connected through mobile technology and with it come plenty of alternative opportunities that have not yet been introduced in the developing world. The GSMA predicts that over 80% of the expected six billion connected smartphone users in 2020 will be users in developing countries. This presents the opportunity to assist people by breaking down prohibitive infrastructure barriers. One very interesting prospect arising from this change is the development of mobile healthcare. In this new world healthcare will become more accessible, opening a realm of possibilities for people in countries whose access to healthcare is currently both limited and incredibly expensive.

CONCLUSION

Mobile computing in the developing world is rapidly expanding as technological advancements have allowed for more affordable and accessible smartphones in the developing market. This enables businesses to tap into over 3 billion users that were

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once inaccessible, creating incentive to develop the infrastructure necessary to provide better service to this new market. With superior service comes access to richer media in advertisements and applications. A movement away from text-based applications and toward those that are media-rich enhance the quality and accessibility on a mobile device. This creates opportunity for business and lifestyle improvements for all of the developing markets, including access to mobile healthcare and banking. As global bandwidth and processing capacity on affordable smartphones increases, mobile technologies will allow for great business expansion and opportunity in the developing world.

123. SMART HOMES

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INTRODUCTION

It is hard to imagine what technology is not involved in nowadays. From our vehicles, to our work spaces, to our purchases, and smartphones, technology is an integral member of our lives and is continuing its integration into our everyday decisions. While it has long been dreamed and discussed about, Smart Homes has finally become a reality, with innovators like Nest starting to introduce these technologies into our homes.

INTERNET OF THINGS

The Internet of Things (IoT) stands as one of two great ongoing technological trends along with cloud computing. It describes how computing and communication technologies are becoming increasingly embedded in our everyday lives. Everything from consumer products to industrial machines are acquiring the capability to connect to the Internet, with prominent examples such as wearables, self-driving cars, and intelligent home appliances. Numerous firms, including Microsoft, Oracle, Amazon, and Google are seeking to take advantage of this growing trend by creating innovative new products that allow consumers to better interact with the world around them. By observing product emergence fuelled by new technologies such as cloud computing, web services, and big data analysis, it is clear that the smart home can now become a reality.

THE SMART HOME

As individuals increasingly adopt smart home technology, they will recall an era when people could not expect to interact with their homes, or when their home could not learn their habits. Children will be astonished to learn that their parents grew up in homes where their appliances and lighting systems did not operate based on data about current outdoor weather conditions. As of early 2015, it is evident that the next frontier of digital technology innovations is the smart home. The home is one of the increasingly few areas of our lives that are still reliant on physical and analog solutions.

Central to understanding the smart home is understanding that it is not a single technology. The smart home experience relies on several interconnected technologies, products, and services that utilize external data and Internet connectivity to operate more intelligently. An example of the benefit that smart homes can bring is a home where

the lighting systems, home appliances, and HVAC systems are synchronized to minimize energy use and lower costs by adapting based on outdoor weather conditions.

FROM OLD TO NEW

Most consumers today continue to use out-dated, physical, and analog solutions in their homes. These include everything from light switches, thermostats, to refrigerators. However, there are emerging players who are rapidly gaining market share in the smart home market. These include companies such as Nest which sells a successful thermostat product, which unlike their outdated counterparts, connecst to the Internet, is self-learning, and can continually update itself through software updates. This product can be connected to a smartphone, and the customer can control the temperature of their home from anywhere in the world, as long as they have an Internet connection. This can provide significant benefits to the end user, such as helping them save energy costs and allowing them to view data insights on their energy use. Another example is the WEMO Light Switch by Belkin, which allows an individual to control their home light switches from their smartphone. It also enables the user to program the device to turn their home lights on and off based on constantly updating sunset and sunrise times.

KEY PLAYERS

Currently, there are several key players in the home automation industry. Some notable examples include Google, which acquired Nest Labs, as well as Samsung, another technology giant that has recently acquired another company with significant growth potential, SmartThings.

AFFECTED MARKETS

Several markets will be significantly affected by this growing industry. In many cases, home automation will bring plenty of opportunities for different types of firms to innovate by creating new products and software solutions to compliment the smart home experience. One prominent example is the Smart Home Assistance market. Firms like Best Buy will very likely provide users with assistance in navigating this increasingly complicated ecosystem of interconnected devices with their Geek Squad service. Other markets that will be affected include home cloud solutions, e-Health, and telecommunications.

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TECHNOLOGY

Communication in smart homes rely on radio frequency (RF) signals. These signals do not require line of sight communications and can operate at reasonably long distances. Three main communication protocols are INSTEON, UPB, and Z-Wave systems.

INSTEON uses existing wires like a home’s power line in addition to RF signals, and is considered the gold-standard in home automation since it can control everything from lighting to integrated security systems. Unique network topology means each INSTEON-enabled device adds strength to the signals to a home network. These devices are also fully forward and backward compatible. INSTEON’s automatic error detection and correction protocols mean that each message is confirmed as it is received, so signals are resent if any errors are detected.

UPB also uses power line wiring for signalling and control. It is an extremely technical and sophisticated system, which means startup costs are slightly higher though elegant network design guarantees smooth functionality even with dozens of nodes or devices in a home network. UPB groups devices by rooms according to controller environments and uses network and unit IDs and network passwords to keep devices secure.

Similarly, Z-Wave systems are identified and secured by Network ID and Node ID. This protocol allows devices to communicate with one another through longer distances and circumvent household obstacles or radio deadspots through network healing. Signals in this network “hop” from one node to another to produce the desired result. Established routes become optimized and continues to optimize itself using pruning algorithms as more nodes are added.

FUTURE TRENDS

Wearable technology such as smart watches, the Nymi, and Google Glass are making it easier for devices to recognize their owners and customize their behavior and profiles. These devices are also the key to increased security and seamless authentication. In the future, our mobile computing devices will authenticate our identities by pairing themselves to their owner’s fingerprint or voices, allowing homes to automatically adjust the lighting, room temperature, or play custom music based on personalized

preferences and pre-configured profiles.

IMPACT

The Internet of Things has been described as an “extension of the Internet to the physical world.” As a part of the IoT revolution alongside wearables and driverless cars, smart homes are poised for incredible growth in the near future. Currently, full-service smart homes are still a niche category; less than 1% of U.S. households are have smart home systems fully installed. However, by 2020, 50 billion objects are expected to be connected, with the penetration of connected objects in total “things” expected to reach 2.7% in 2020 from 0.6% in 2012. This growth is partly driven by an increased prevalence of smartphone and tablets, which are often at the center of controlling the smart home technology. Moreover, with technology developing and getting cheaper, the mainstream market is expected to grow 60% to more than 6.4 million devices. This essentially creates an entirely new industry - home automation, which is projected to grow to $14.1 billion in worldwide revenues by 2018. As our generation leads the trend to always be connected, to be more sustainable, and to maximize efficiency, smart homes certainly have a very bright future.

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