Digital transformation

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Dr Mike Short VP Telef ó nica Mike.short@telefonica.com. Digital transformation. through mobile technology_. Telefónica. a leading company in global telecoms. 24 countries. 313 million customers. A world leading provider of integrated mobile, fixed & ICT services. 120,000 employees. - PowerPoint PPT Presentation

Text of Digital transformation

Mike Short

Digital transformation

through mobile technology_Dr Mike ShortVP TelefnicaMike.short@telefonica.comWere living in a world of huge change. More people access the internet on mobile than fixed devices Theyre spending more time on mobile than fixed.

We live in a mobile society and mobile economy. Living a digital life is no longer a choice. But its how you navigate the opportunities that it presents that will make a big difference. At O2 our belief and approach is to embrace and harness what tech brings. Were opening the possibilities of technology to everyone.We deliver technology and services that add value to peoples lives and business.

Its about protecting the present and building the future.

Opening the possibilities of technology to everyone.Tugo high quality WiFi calling. Free for o2 customers

+ Mobile Internet continues to grow, innovate and offer choice + Cellular / Wifi coverage and investment open up new comms/video opportunities + Public services benefit through connectivity and standards + Connected cities better informed and served ; more secure + Big data analytics / social media important for public safety and other sectors too.

The Smartphone market hit 1.2 billion in 2012 and isforecast to reach 4.5 billion by the end of 2018 according to Landmobile.co.uk.

What does this mean for services and coverage for all of us in a world of Digital Transformation. I will cover a UK market overview first ; then some international trends of Mobile Internet and then the implications .

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Full network operations (21)Service reach (152)57 billion revenue

24 countries313 million customers120,000employeesA world leading provider of integrated mobile, fixed & ICT servicesTelefnicaa leading company in global telecoms

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19731983Motorola DynaTAC8000X 2003199920072013Motorola InternationalMotorola StarTACNokia 8110Motorola RazrNokia N80Nokia 1200Apple iPhoneSamsung Galaxy SIIIBlackBerry Z10Samsung Galaxy S4First mobile call4G

Nokia21101993

NokiaCommunicatorO2 XdaThe mobile phone turns 4020143G2G1G

Do you remember your first Mobile phone?April last year marked the 40th anniversary of the first mobile phone call in a public setting But it wasnt until 1996 that the 1G Analogue cellular phone launched. 2G GSM cellular Digital from 1991 until today largely a voice based service but with higher data rates added through GPRS and EDGE 3G launched around 12 years ago adding data rates and higher speed connectivity ...often as broadband ; Smartphones since 2007 (Apple - Sept 2007 in the UK BUT did not have Wifi OR Apps stores at the beginning. But pace of 2G / 3G / WIFI has been huge seen since ) 4G from last year or from O2 since August 2013

In March 2014 the web celebrated its 25th birthday. Its proof of what a well established platform it is and its become a central part of peoples lives.

Expected that by end of this year therell be more mobile phones than people.3Everyone now has the power to innovate in a digital world thanks to the marriage between the two great innovation platforms of the 21st century: internet and mobile.

Dr. Mike Short, VP Telefnica, Financial Times, April 2013Smartphone users still risingAs people convert from mobiles to smartphones theres a huge upside still to happenSmartphonesMobile phonesGlobal Mobile Users 2013 estimates1.5Bn5Bn4Bn3Bn2Bn1BnSource: Morgan Stanley Research estimates.One user may have multiple devices. Subscription numbers may be higher than User numbers.

7.4bn all together by mid 2014. If you added tablets it would be even bigger!1.8bn smartphones v 5.6bn mobile phones in use5differently_see the world

6analog_from

digital_to

unconnected_from

Connecting people, services and machines.Examples: email, ticketing, ecommerce, mobile payments, connected bus stops9connected_to

Were communicating more than sleepingThe average UK adult is now spending more time using media than they are sleeping. 8h 41m communicating versus 8h 21m sleeping8hrs 41mSource Ofcom August 2014

We're communicating more than sleepingIt's not only younger teens that are making the most of digital communications technology. Ofcom's research shows that the communications habits of adults of all ages are shifting as they embrace newer services and take advantage of portable connected devices. The average UK adult now spends more time using media or communications (8 hours 41 minutes) than they do sleeping (8 hours 21 minutes - the UK average).

In fact UK adults squeeze over 11 hours worth of communications and media activityinto less than nine hours. The total volume of media and communications activitiesundertaken by an individual each day equate to 11 hours 7 minutes. But as somemedia activities are conducted simultaneously, this is squeezed into 8 hours 41minutes per day.

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Currently campaign on our netowrk.We have more ways to connectMoving from connectivity to connectedness

4g we have achieved 40% indoor coverage in 12m, 2m customers. Growing fast.12Were even better connected_

6 million UK 4G mobile subscribers 73% of premises are in areas with 4G coverage4G MobileSuperfast BroadbandPublic Wifi11m O2 wifi users10,000 hotspots26.1 million superfast fibre broadband connectionsUp 58%Ofcom 2014:The number of superfast broadband connections increased by 58% to 6.1 million in the year to March 2014. The proportion of all fixed broadband connections that were classed as being superfast increased by 9.2 percentage points to 26.7% over the same period. 4G services are now available on all four UK national mobile networks, and by March 2014 there were more than 6 million 4G mobile subscriptions. 4G licence - we have committed to a regulatory requirement of reaching 98% indoor population coverage by 2017. But our network investment (1.5m per day, 3bn over three years -2014-17) means that we can accelerate our 4G rollout plans and are on course to meet this obligation up to two years ahead of schedule.

Data provided to Ofcom by the mobile providers show that 73% of UK premises were in areas with 4G coverage from at least one provider in June 2014. There were 55 million UK mobile data connections at the end of 2013. The total number of mobile data connections increased by 6.5 million (13.3%) during the year. Total operator-reported telecoms revenues fell by 0.6m to 38.6bn in 2013.

13Smart metering_

A stepping stone to the smart homeCoverage targets80%201597%201799%2021Actual figs: 80% by 2015, 97.75% by 2017 and 99.2% by 2021.Smart meters being installed in 23m homes

14Smartphones are used everywhere97%85%72%64%61%61%59%52%44%28%16%HomeOn the moveWorkIn-storeCoffee ShopPublic TransportRestaurantSocial GatheringAirportDoctorsSchool

Source: Google Survey on Internet Usage, H1 2013

61% adults has a smartphone (Ofcom, 2014)

Smartphones were first mostly used for businesses, and by people on the move. Now theyre being used more by consumers and increasingly in the home.Poss replace with Ofcom stats Comms Mkt report (CMR)15

Time spent per day by O2 UK smartphone users, by applicationSource: UK Smartphone Data 2012 (O2 users only)25 mins17 mins16 mins14 mins12 mins11 mins10 mins9 mins9 mins3 minsBrowsing the internetSocial networksListening to musicPlaying gamesMaking callsEmailTextingWatching TV/FilmsReading booksTaking photos

128TOTAL MINUTES PER DAY

The figures for 2013 arent in yet but its expected that the white boxes, which signify the basic phone functions: making calls and sending texts, will have moved to the right. Demonstrates how its not only about growing usage of phones but changing usage.16Not so long ago, people just danced at concerts.Now they click, video, share & tweet_

its about sharing experiences through mobile technology. And were seeing a perfect example of this with Man City and their stadia solutions.17Media + Data Upload + Sharing from mobiles =Ramping fast and is still in early stagesExplosive growth but still early stage.PhotosVideoAudioData uploadRamping fastStill emergingStill emerging

NowFirst

Changing the way things are done. How are you going to be part of a growing application space thats growing the with internet?

High quality audioBig data18Mobile traffic as % of total Internet trafficGlobal mobile Internet traffic as a % of total Internet traffic 2009-2013Source: Statcounter Global Stat 5/13.

ForecastActual Q1 14

New ofcom research reports that 6/10 adults access internet on their mobile.

Now moving ahead of the Red line probably over 25 % by end Q1 2014 . Importance of Mobile Internet is already seen in Google Mobile first strategy, Facebook figures and Twitter flotation noted Mobile priorities .

These stats estimate that in May 2013 15% of total global internet traffic will be via mobile phones and that this will reach 30% by the end of the year.In the UK it reached 30% 18 months ago. Were ahead of the curve.19YouTube uploads reach 100 hrs per minute6 years ago it was nada.Source: YouTube

100hrsper min

No. hours of video uploaded to YouTube every minute

Technology cyclesMainframe computing1960sStill early cycle on smartphones & tablets. Now wearables coming on strong, faster than the typical 10-year cycle.1970s1980s1990s2000sTodayMini computingPersonal computingDesktop Internet computingMobile Internet computingWearable/Anywhere Internet computing

Computing has changed hugely21Sensor-enabled wearable technology

Where technology meets fashion3rd party appsAPI partnersAccessoriesDevelopment PlatformLess distracting when receiving alerts, reminders and messagesAttention-gettingVoice or gesture controlHands-freeLow pow