Towards a digital economy. Strategic vision

Gianluca Di Pasquale

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► The explosion of mobile devices

► Simplicity is the ultimate sophistication

► Shift of focus from the product to customer experience journey

► Expansion of new e-purchase habits (e-commerce, mobile commerce, gamification) to new domains

► Eg. Customer engagement in energy management and smart homes

The digital customer experience era

► Consumers will never return back to

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Extreme productivity bringing marginal cost to near zero

► “Shareable value” supersedes “exchange value”

► Cooperation vs. Competition

► Sustainability vs. Consumerism

The rise of the Collaborative Commons

► In the digital economy, social capital is as important as finance capital

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The digital world attacks the physical world

► Innovations in the digital domain are passing across the firewall from the virtual world to physical goods and services…

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…and are disruptive

► The digital innovation changes the paradigm bringing to new model of industry transformation

► Individual importance of companies is disappearing

► Key players are “business economic system”

► Products and services will need to be, networked, developed and marketed as hybrid bundles

5 enabling solutions

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MOBILE

DATA MANAGEMENT

SOCIAL

INTERNET OF THINGS

CLOUD

E-payment, applications,

citizen and city user services

Vehicles, building, wearable and other connected devices

USER EXPERIENCE

Service delivery platform B2G, B2G2C, B2B

Sharing e collaborative

economy, customer sentiment

Big data, analytics, semantic

The Internet of Things will have a major economic impact, with differences between geographies

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0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

35,0%

40,0%

45,0%

50,0%

$0 $5.000 $10.000 $15.000 $20.000 $25.000

Degre

e o

f im

pact

(Va

lue

at

Sta

ke

/ i

nd

ust

ry s

ize)

Geography size (value added $B)

United States ($4.6T)

Japan ($0.7T)

China ($1.8T)

Western and Eastern Europe

($4.3T)

Canada ($0.4T)

Rest of world ($2.6T)

Source: Cisco IBSG 2013. Estimations to 2022

Investments in IoT are on the rise especially in energy, transportation and manufacturing

91% 89%

86% 86%

79% 77% 76%

65%

70%

75%

80%

85%

90%

95%

% of Respondents Increasing IoT Investments in the Next 3 Years

Source: Cisco IoT Survey 2014

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► Investments in IoT are on the rise

Infrastructure is king in the Third Industrial Revolution

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The Communication Internet

is going to converge

with a digitized Energy Internet

and a

digitized Logistics and Transportation Internet

The Super IoT platform enabling the convergence of infrastructures

► A super IoT platform can help meet the challenges of the cities of the future through an innovative scheme that substitutes the traditional “vertical silos” approach with a pioneering view based on interoperability among service categories.

► Players from different industries compete and collaborate in each layer to deliver hybrid bundles of products/services to customers & citizens.

Service

LIVELLO 3 DELIVERY PLATFORM

LEVEL 1 BASIC INFRASTRUCTURE

LEVEL 2 CONNECTED OBJECTS

LIVELLO 4 APPLICATIONS &

SERVICES

Broadband & Wi-Fi

Smart Lighting

Smart Grid

Cameras Buildings Vehicles

Applications Services for the citizen

Big Data elaboration and management

Transport Network

Sensors Mobile

devices

LEVEL 3 DELIVERY PLATFORM

LEVEL 4 APPLICATIONS & SERVICES

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Case study: towards the converging digitalized Energy Internet in the U.S.

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► Consumers’ expectations for a connected life are expanding beyond the world of mobile gadgets to include a wide range of smart home and smart automotive devices

► Wi-Fi connectivity increases purchase likelihood for smart home devices

► 60 million households and businesses can use Green Button to access their own energy usage data from their electric utility

► A growing set of companies are offering products, services, and apps that use Green Button data

Why urbanization is important

70 3

11

16 26

8

37

29

Developed economies

Emerging marketmegacities

Emerging marketmiddleweight cities

Emerging market smallcities and rural areas

► From 2007 to 2025, population in the top 600 cities by GDP will grow 60% faster than the world population as a whole.

► 423 emerging market mega and middleweight cities will generate more than 45% of global GDP growth, as opposed to 16% of the top 177 developed market cities.

► The urbanization process and the increasing energy demand are concentrating the need for enhanced energy and mobility infrastructures in the cities, especially in emerging market cities where there is a big gap between demand of services and their provision.

Contribution to GDP by type of city, 2007 (%)

Contribution to GDP growth by type of city, 2007-2025 (%)

Source: McKinsey Global Institute, 2011

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Service provider

A strategic Vision for industries: From mono-service providers to a single contact point

Service provider

Supply contract (kWh, m3, kg, etc.)

Mono-service consumer

(Monopolies, cost reduction)

Service 1

Service 2

Service 3

Service 4

Multi-service consumer

(price competition, business integration, marketing efforts)

Smart consumer

(collaborative economy, value chain synchronization,

aggregation of services, simplicity)

Service provider: a single contact point

for the consumer

Service 1 Service 2 Service 3 Service 4

Service 2 Service 3 Service 4

Service 1

Service 2 Service 3 Service 4

Service 1

Customer engagement

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