Building a Profitable IoT Ecosystem

Sharing the Value

Patrick Zhang

President, Marketing and Solutions Department,

Products & Solutions, Huawei

2

Connected Elevator Internet of Vehicle Predictive Maintenance

Smart Metering

More…

More…

Smart parking Connected City Lighting Smart Water

Smart Home

How to Share the Value from Industry Digitalization

Cost Saving Revenue Sharing New Profit Growth New Business More…

3

Smart Water, $5.7/meter/year from Cost Saving

Telco Business Modeling

$5.7US

/meter/year

Service

IoT

Platform

Meter

ConnectivityMisreading

compensation

Leakage loss

Meter reading cost

Meter

Amortization

0.7

27.3

5.7

2.9

Manual reading

(million USD/year)

Smart Water

(million USD/year)

0.14

19.1

4

5

30%

80%

Water Company Business

30%

Cost Saving 8.36M USD/year Telco Income : 4M USD/year

700k meters

4

Smart Parking, $7.5 ARPU from Revenue Sharing

Labor cost**

$1.62M

Revenue*

$2.74M

* Revenue: $2.74M = 1,000 parking spaces x $2.5/day x 365 days x 3 years

** Labor cost: $1.62M = 60 staffs x $750/month x 12months x 3 years

95% Revenue

Parking

Company

$5.21M

2X• Increase parking space usage

• Missing payment prevention

60 → 10 headcounts $0.27M

5% Revenue

$0.27M

Telco Business Modeling

Manual Parking

Management

Smart Parking

Parking Company Business

Parking Space

Connection

IoT platform

Device

$0.46

ARPU

$7.5

ARPU

Telco shares

5% revenue

Parking

Mgmt

System

3rd Party

APP

1,000 parking spaces in 3 years

16X connection ARPU

5

Connected Elevator, $6.5 ARPU from New Profit Growth

Cost Saving $4.88M/yearTraditional

IoEL$ 4.94M

$ 4.13M

$ 2.47M

Elevator Manufacturer Business

$ 7.54M

Accessories

Maintenance

39%

Connection

Service

Agile Controller

Elevators

IoT Platform

AR IoT Gateway

Telco Business Modeling

$6.5

ARPU$0.7

ARPU

$ 1M

(10K elevators maintained in this case)

6

Smart Home, $7.5 ARPU from New Business

$32

/month

$32

/month

$7.5

/month

Internet Internet +

Smart Home

Service

IoT

Platform

Connection

Device

Equipment package: $7.5

• 1 Home gateway

• 1 Door sensor

• 1 Motion sensor

• 1 IP Camera

ARPU increase: $7.5 (23%)

Service provided

• Home monitoring

• Home security

Service package

$7.5/month

Equipment package

$7.5, 24-month contract

Kit Smart Home

7

Create Value , Share Value over IoT Platform

IoT Agent

…

Smart Home IoVehicleUtility OtherSmart City

3rd Party

Cloud & APP

IT System/

OT System/

Vertical Industry Cloud

Device Management

Connectivity Management

Application Enablement

OceanConnect

IoT Platform

API

Device ServiceConnection IoT Platform

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limitation, statements regarding the future financial and operating results, future product

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