IoT and Digital Data Challenging The Way We Communicate

IoT and Digital Data Challenging The Way We Communicate New challenges in communication between people and between people and machines Alexander Habinski Head of CSP & ISV CEE IBM Global Business Partners Bled 19.06.2017 Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017 1

The world is being reinvented in code... C C I C + D 100,000,000 lines of code in a new car 1,200,000 lines of code in a smartphone 50% Smart TVs represented 27% of all TV sales in 2012; by 2018, they will represent 82%. Sensors for industrial asset monitoring and management will grow from just over 15M units in 2014 to 80,000 lines of code in a pacemaker of B2B collaboration will take place through web APIs next year. Smart LED lighting will grow from 6M units in 2015 to 570M units in 2020, used for safety communication, health, pollution and personalized services. By 2017, there will be 1B connected things in smart homes, including appliances, smoke detectors and cameras. Code Tools Analytics Data APIs over 40M units in 2018 Smart traffic sensors and other devices installed in smart cities will grow from 237M units in 2015 to 371M in 2017. By 2020, there will be 925M smart meters installed worldwide, more than double the 400M in 2014. Revenues for smart grid sensors will grow tenfold from 2014 to 2021. Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 2

as cloud & digital with IoT become the business concept Dissolution of the Old => sometimes with more unstable revenue streams in the new normal, few big turns into many & small PLATFORM BATTLE (who owns the platform wins) PAY PER / SUCCESS FEE / REV. % SHARE VALUE CAPTURE via ecosystems and API s OPEX ECONOMY - Off Balance Sheet Control points around number of connections, data platform, influx and ability to reach new clients Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 3

Think - uber disrupts taxi (CCIC + D) hazzlefree transparent realtime information match: supply / demand dynamic pricing => transforms mobility worldwide city traffic, traffic planning, transportation, driverless car, traffic management, shared car services, car industry, new car communication services, flight industry, taxi industry Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 4

EXAMPLE: DIGITIZATION IN AUTOMOTIVE In the IoT, the car is literally a big data in motion problem, and risks to become just another thing, with the potential of brand values shrinking close to zero. Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017 IBM

? Code Cloud* - IoT - Cognition + Domain Expertise CCIC => major impact on required roles, functions, capabilities and society will heavily transform: 1. how we live, work, earn etc. 2. how we use, handle communication 3. how businesses are run and supported * Cloud as a Business Model IT aside Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 8 Picture: copyright T. Hofmann

Cognitive Systems Knowledge & Activity Base Political Economic - Social etc. Impact Humans survive by generalisations, Robots survive and thrive on particularities (J.K) Take it with Marx. Power shifts back to capital but individuals can profit in an unprecedented way C C I C + D Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 9 Picture: copyright T. Hofmann

OBSERVE / SENSE (IOT) Smart TVs represented 27% of all TV sales in 2012; by 2018, they will represent 82%. Smart LED lighting will grow from 6M units in 2015 to 570M units in 2020, used for safety communication, health, pollution and personalized services. By 2017, there will be 1B connected things in smart homes, including appliances, smoke detectors and cameras. Code Tools Analytics Data APIs Sensors for industrial asset monitoring and management will grow from just over 15M units in 2014 to over 40M units in 2018 Smart traffic sensors and other devices installed in smart cities will grow from 237M units in 2015 to 371M in 2017. By 2020, there will be 925M smart meters installed worldwide, more than double the 400M in 2014. Revenues for smart grid sensors will grow tenfold from 2014 to 2021. Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 10

EXAMPLE Hi Team, The times are difficult! Our sales have been disappointing for the past three quarters for our data analytics product suite. We have a competitive data analytics product suite in the industry. However, we are not doing a good job at selling it, and this is really frustrating. We are missing critical sales opportunities. We cannot blame the economy for our lack of execution. Our clients are hungry for analytical tools to improve their business outcomes. In fact, it is in times such as this, our clients want to get the insights they need to turn their businesses around. It is disheartening to see that we are failing at closing deals, in such a hungry market. Let's buckle up and execute. Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 13

Regarding Communication / Interaction 1. Human Interaction (working Through Glass) enhanced by IT 2. Human to Machine 3. Machine to Human 4. Machine to Machine Interaction 5. Autonomous Business - done by machines Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017l 16

A Strategist s Guide to Industry 4.0 In the PwC study of Industry 4.0, the most commonly cited difficulty in building an analytical capability was the lack of people with the expertise to conduct analysis. Requires good internal company structures, procedures, data collection, platform creation and participation). Also scale up s need to behave like small multinationals Other prominent concerns: poor data quality, lack of access to the right data lack of top-level support If you can t make sense of that data and use it to boost efficiency, grow closer to your supply chain partners, and develop products and services your customers actually want, much of the effort is wasted. Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017 IBM Confidential 22 www.strategy-business.com/article/a-strategists-guide-to-industry-4.0?gko=7c4cf

Humans Need Not Apply: A Guide to Wealth and Work in the Age of Artificial Intelligence. 2015, Jerry Kaplan Recent advances in computing may place us at the threshold of a unique turning point in human history. Soon we are likely to entrust management of our environment, economy, security, infrastructure, food production, healthcare, and to a large degree even our personal activities, to artificially intelligent computer systems. The prospect of "turning over the keys" to increasingly autonomous systems raises many complex and troubling questions. How will society respond as versatile robots and machine-learning systems displace an ever-expanding spectrum of blue- and white-collar workers? Will the benefits of this technological revolution be broadly distributed or accrue to a lucky few? How can we ensure that these systems respect our ethical principles when they make decisions at speeds and for rationales that exceed our ability to comprehend? What, if any, legal rights and responsibilities should we grant them? And should we regard them merely as sophisticated tools or as a newly emerging form of life? The goal of CS22a is to equip students with the intellectual tools, ethical foundation, and psychological framework to successfully navigate the coming age of intelligent machines. Copyright Instructor: 2017 IBM Corporation. Jerry All Rights Reserved. Kaplan 24 30 June 2017 IBM Confidential 24

Cloud Service Models Traditional On-Premises Applications Data Infrastructure as a Service Applications Data Platform as a Service Applications Data PaaS eliminates / simplifies various tasks: Runtime Runtime Runtime Health management Middleware Middleware Middleware Load-balancing O/S O/S O/S Scaling Virtualization Servers Storage Virtualization Servers Storage Virtualization Servers Storage Deployment OS patching OS security hardening Networking Networking Networking Client Manages Vendor Manages in Cloud Standardization; OPEX savings; faster time to value IBM SoftLayer IBM Bluemix Copyright 2017 IBM Corporation. All Rights Reserved. 30 June 2017 IBM Confidential 25