Semiconductors for the Connected World –

Safe, Secure, Smart

Kurt SieversPresident

Waves of Innovation

10B -

100M -

1M -

0.01M -

1B -

10M -

0.1M -

19

50

-

1970 -

19

90

-

20

00

-

20

10

-

20

20

-

19

80

-

19

60

-

Units S

hip

pe

d

Bipolar ICs CMOS MPU

DRAM

Bipolar Fast Air Interface

Servers

Free Storage, Big Data

Neural Networks & Processing

Mainframe Mini-Computer PCs Cell Phones IoT/ AI

1 2 3 4 5

Source: Extracted from Jefferies Report

IoT/ AI the next innovation wave

Semiconductors for the Connected WorldSafe, Secure and Smart

IoT and AI – The Next Wave of Innovation

Four Technology Pillars Unlocking the IoT/AI Wave

Example: Safe and Secure Mobility

The Internet of Things is Transforming Our World

Connectivity Safety & Security(incl Privacy)

Processing (incl AI, ML)

Sensing

1B+ additional

consumers online,

30B+ connected devices

Physical and functional

safety & security to protect

the smarter world

40B+ devices with

intelligence shipped

in 2020

Precise perception

of the analog and

human environment

Smart

Transportation

Smart Cities

Smart Industry

Smart & green mobility

Autonomous transport

Traffic management

Infotainment

Smart retail

Public Safety

Secure identification

Smart access

Smart Infrastructure

Smart Hospital

Smart Transportation

Industry 4.0

Factory automation

Machine learning

Agriculture 3.0

Smart utilities

Major IoT Growth Markets

Smart Home

Connected

ConsumerMobile payment

Smart cards

Wearables

Healthcare

Smart appliances & Computing

Smart Metering

Home automation & surveillance

Entertainment & Gaming

Massive Growth in Smart Connected Devices Forecasted IoT market growth from 15 billion devices in 2015

to 31 billion devices in 2020 and 75 billion in 2025

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

0

20

40

60

80

(Billions)

Install base

Smart Connected Devices,

global market

Source: IHS

15 18 20 2327

31 36

43

50

62

75

Semiconductors for the Connected WorldSafe, Secure and Smart

IoT and AI – The Next Wave of Innovation

Four Technology Pillars Unlocking the IoT/AI Wave

Example: Safe and Secure Mobility

High-Performance SensingPrecise recognition of the analog & human environment

Human

Contact

Beyond Line

of Sight

Line of

Sight

Mesh Networks (V2X, ZigBee)

Radar Laser Vision Ultrasound

Face & Gesture

Recognition

Biometrics

(Fingerprint & Iris)

Voice Recognition Motion, Pressure,

Temperature Sensing

1

WIDE AREA

SHORT

RANGE

ULTRA-SHORT

RANGE CAT-M1 NB-IoT

5G

Wireless ConnectivityConnectivity landscape with varying performance, energy, range

2

UWB

DSRC (V2X)

Machine Learning/AISuperior recognition & digital modelling enabling new applications

SecurityAutomatically detecting

attacks or strange user

behavior

Personal Health52% breast cancers detected

on mammography scans one year

before officially diagnosed

(computer-assisted diagnosis) 1

Autonomous

DrivingCould reduce road

fatalities by 90%2

Voice

AssistantsTop benefits seen

by U.S. consumers:3

- Better purchasing guidance

- Less time in front of screens

- Convenience in daily life

- Less waiting time in hotlines

1) Gartner Predicts 2017 2) McKinsey & Company, 2015 3) Statista: Opinion of the benefits of virtual assistants among U.S. residents 2017

3

Enable Real-Time Analytics and ActuationTime sensitive applications not hampered by network latency

On-Board Machine Learning Precise & fast detection, classification, adaptation

Reduce Data Center TrafficData centers only process & store relevant data

Reduce Network CostLocal processing shields Cloud from large part of raw data

Safeguard PrivacyTransmit semantic data rather than raw data

Increase SecurityResilience to offline conditions

Robustness & SafetyLatency & availability

EconomicsPerformance & efficiency

Less bandwidth & storage

Data Protection Privacy & security

Moving from Cloud to edge: Edge ComputingEfficient, High-Performance Processing

3

Safety & Security – Basis of User AcceptanceNo Safety Without Security & Privacy Protection

4

Privacy and Security: 10x Growth

Security 2.0 Built Into Everything We Do

CONNECTED THINGS

LIFE CYCLE

MANAGEMENTInteroperability

Authenticity

Device Integrity

SW Management

Secure Access

Credential

Management

Data Integrity

& Privacy

Security & Privacy by Design

4

Semiconductors for the Connected WorldSafe, Secure and Smart

IoT and AI – The Next Wave of Innovation

Four Technology Pillars Unlocking the IoT/AI Wave

Example: Safe and Secure Mobility

Megatrends Transform Automotive Industry

Connected Infotainment ElectrificationADAS Autonomy

Safe and Secure Mobility

ZEROTime Wasted

ZEROEmissions

ZEROAccidents/Congestion

Megatrends Sustainably Boost Semi Car Content1,2

Safe and Secure Mobility… from $380 average semi value (TAM) per car in 2018

+$100 Premium

Experience

+$400 Hybrid

+$450 Full Electric

+$150 Level 2

+$600 Level 3

+$1200 Level 4&5

Connected Infotainment ElectrificationADAS Autonomy

1. Source: Strategy Analytics, NXP

2. Semi content based on 2020 price levels

Megatrends Drive Exponential Performance Requirement1

0.22

20

2015 2020 2025

Data Generation(TeraByte per hour)

• Dramatically more sensors

• Higher precision

0.2 2

100

2015 2020 2025

Compute Performance(TFLOPS)

• ADAS & autonomy

• e-Cockpit

0.11

10

2015 2020 2025

Network Bandwidth(GigaBit per Second)

• Loads of data (on & off board)

• Real-time distributed applications

1. Source: NXP

An Attractive Market ...

And a Truly Inspiring Vision to Pursue!

emissionszero

accidentszero

congestionzero

Safe and Secure Mobility