Yves Gassot Directeur Général, IDATE
‘‘Mobility reloaded” will be the central theme of the 36th annual DigiWorld Summit.
Following through on ‘‘Game Changers’’ (2012) and ‘‘Digital Gold Mines’’ (2013), this year’s theme will allow us to further our examination of current and future upheavals in the digital economy by exploring the issues from a specific angle: mobility and its impact on user behaviour and on the value chain for telecoms, TV, advertising, the Internet, gaming, smart cities, etc.
- What innovations can we expect from mobile Internet disruption?
- Are fixed and mobile superfast access interchangeable?
- What new players and business models will emerge from the Internet of Things and mobile advertising?
- Will mobile devices turn TV into a one-to-one business?
- How can Europe get back in the game?
IDATE Chairman François Barrault points out that, ‘If the cloud, big data and the Internet of things are clearly the major disruptions looming on the horizon, the momentum today lies in the mantra: mobility first!’
IDATE CEO, Yves Gassot, details the key points of this year’s programme: ‘What began with the swift commercial success of 4G is segueing into the spectacular technological leaps expected from LTE-advanced and, beyond that, the prospect of 5G, the widespread adoption of software-driven networking (SDN)… But questions also linger over the accelerated pace of the migration from the fixed to the mobile Internet, spurred by the massive popularity of smartphones and tablets, coupled with the surge of emerging economies. It goes without saying that a great many stakeholders are being affected by these massive changes in the landscape, which we have chosen to explore from three angles: How revenue is progressing for mobile operators and other players, from M2M to the Internet of things and beyond; How the massively mobile Internet will affect the advertising ecosystem; and how TV industry players are positioning themselves now that video accounts for an increasingly large share of mobile traffic’.
The 36th annual DigiWorld Summit will run from 18 to 20 November in Montpellier, France, and play host to a panel of international industry luminaries who will share their views with more than 1,300 participants from 30 countries. IDATE analysts will lend their expertise to the sessions that will be moderated by Digiworld Institute members.
DigiWorld Week: the DigiWorld Summit broadens its horizons
This year’s DigiWorld Summit will kick off DigiWorld Week: a new initiative from IDATE and its key partners to explore the many facets of the digital society’s core economic issues. A series of exciting events will be taking place from 16 to 21 November on either side of the core two-day Summit:
- The Connected Things Forum
- The Game Summit
- MIG (Montpellier In Game)
- Industry Oracles
- Economic Club on m-payment
> Find the latest programme updates at www.digiworldweek.com
More than 140 speakers on hand
This year, we are delighted to welcome speakers from the four corners of the globe, come to share their views on the future of mobility:
- Mikael BÄCK, Vice President Global Strategy & Portfolio Management of Ericsson will share some of the chief findings of the “Mobility report”.
- Jean-Michel FOURNIER, CEO & Co-Founder of BitGym, a San Francisco-based start-up and winner of the prestigious Auggie Award at AWE 2014, will talk about the “quantified self” phenomenon.
- Kayvan MIRZA, CEO & Co-Founder of Optinvent will unveil his approach to new generation smart glasses.
- Patrick PELATA, EVP & Chief Automotive Officer of Salesforce.com will speak with Thierry VIADIEU, New Mobility Program Director from Renault, about the future of connected cars.
- Christophe WILLEM, Senior VP of Strategy & Marketing at Thales Alenia Space, will tell us if drones, balloons and mini-satellites offer viable solutions for connecting huge swaths of the population to the Internet.
- Michel COMBES, CEO of Alcatel-Lucent will close the “Road to 5G” session, whose speakers include Selina LO, President & CEO of Ruckus Wireless, and Atsushi TAKESHITA, President & CEO of DOCOMO Communication Laboratories Europe.
- Pierre LOUETTE, Deputy CEO of Orange and Carlos LOPEZ-BLANCO, Global Head Public & Corporate Affairs for Telefonica, will discuss how telco business models will evolve in Europe, against the backdrop of market consolidation.
- Laurent SOLLY, Facebook’s Managing Director France, and Benny ARBEL, Founder & CEO of MyThings, a rising star in retargeting, will discuss the challenges that advertising faces as it makes the transition to mobile.
- Luc JULIA, VP & Innovation Fellow of Samsung and Co-authored Apple Siri's core patents, Erick TINICO, Director of Mobility at AT&T, one of the world’s most advanced telcos and Axel HANSMANN, Gemalto’s VP of M2M Strategy & Marketing, will share their analysis of new business models for M2M and the IoT.
- Fu SHENG, CEO of Cheetah Mobile, a growing mobile Internet powerhouse in China, with 340 million users.
- Abigail KHANNA, Head of Digital and Future Media Business Development at the BBC, Steve McCAFFERY, GM & SVP of sales for Europe Arris, Eric SCHERER, Director of Future Media, France Télévisions, and Valery GERFAUD, General Manager, M6 Web, will explore what the future holds for television, now that mobile devices are becoming users’ screen of choice.
- Guillaume de FONDAUMIERE, Co-CEO of Quantic Dream, Susan O’CONNOR, a writer whose script credits include the games BioShock 1 & 2, Far Cry 2, Tomb Raider and Star Wars 1313, along with Charles CECIL, co-founder of Revolution Software, creator of Broken Sword, are among our video game Oracles.
- Meng LI, Director of China Telecom’s Mobile Business Department Europe, will talk to us about the development outlook for mobile in its various forms in the world’s biggest market.
- Jean-Ludovic SILICANI will talk about his time as Chairman of France’s telecoms and postal regulator, ARCEP, and share his insights into key issues going forward.
- Vincent LE STRADIC, Managing Director of Lazard, will provide a financier’s perspective on the health of Europe’s digital economy. And…
- Axelle LEMAIRE, French Ministry of State for Digital Affairs will deliver the Summit’s closing remarks.
Iliad has made an offer for 15 billions dollars to take control of T-Mobile US at 56,6%. Yves Gassot, IDATE's CEO gives his point of view.
What is the rationale behind the deal?
This is not a typical case of generating synergies by merging two companies operating in the same national market. It will be hard to bank on swift and considerable synergies between a fixed-mobile telco in France and a mobile operator in the United States.
On the other hand, the US market is far more attractive than the French one (short of a major consolidation deal in France which, at this point in time, seems unlikely) and even more attractive than the ailing European market: 9% drop in revenue for operators in Europe’s five biggest markets over the past five years, versus 29% growth in the United States. In addition to revenue, there are sizeable disparities in margins on either side of the Atlantic, due to less fierce competition in the US and no doubt for reasons of scale as well: in each of Europe’s five biggest markets, four mobile operators are competing against each other for an average 63 million customers, compared to the 315 million users in the States. The planned takeover thus serves as a good reflection of the sorry state of Europe’s telecoms market, and the strong momentum that the US market is enjoying (albeit at the expense of American consumers to some degree).
There is also a certain similarity between T-Mobile, the smallest of the four operators in the US, and Free which is a latecomer to the French market: it is still working to catch up on rollouts, and especially on LTE coverage, and to beef up its spectrum assets. It needs to have the lowest costs to be as agile as possible, to shift price points and marketing strategies at will. Here, Deutsche Telekom’s US subsidiary is a perfect match for Free.
And, finally, because Free/Iliad is smaller in size and market valuation than its target acquisition, the deal could confirm an impressive availability of capital that the Altice/Numéricable takeover of SFR first revealed.
Will the deal go through?
At first glance, this would seem to be a financial question above all. Deutsche Telekom is the seller of an operator that it acquired in 2001, and which cost a pretty penny. And a savvy seller at that, as AT&T learned recently, and as Sprint is just now learning… T-Mobile had signed a deal to sell to AT&T, which was ultimately quashed by the FCC and the FTC but which allowed the Deutsche Telekom subsidiary to pocket 3 billion USD and a stash of frequencies, and to jump back in the game by merging with MetroPCS, stepping up its national LTE network rollouts, and engaging in an aggressive but costly marketing strategy. After having taken control of Sprint (third biggest mobile operator in the US) Japan’s Softbank (which is sometimes referred to as the Japanese Free) launched its bid for T-Mobile, and appears to have reached an agreement in principle with Deutsche Telekom. Masayoshi Son’s valuation of T-Mobile is higher and so more attractive for its owner. This is natural since it involves a consolidation (No. 3 +No. 4) which would have an immediate impact on competition, and generate substantial savings for 4G rollouts and on the sales and marketing end of things.
But money alone cannot be the only factor in play: how American authorities will interpret the acceptable limits of mobile market consolidation also needs to be considered. SoftBank/Sprint have not yet managed to persuade the FCC and antitrust authorities that reducing the market to only three national operators would be beneficial to consumers. And this despite a number of speeches from Masayoshi Son who continues to argue that a “consolidated” third operator would be in a much better position to raid the great bastions held today by Verizon and AT&T. If the authorities remain reticent, Free will have a serious opening.
But it may also have to wrangle with other investors, such as Dish Network which has acquired spectrum and which, now that DirecTV is due to be taken over by AT&T, needs to find other ways to grow its business.
Finally, should the deal go through, Free will need to accomplish what Deutsche Telekom began. This is by no means a foregone conclusion, especially when going head to head with companies like Verizon and AT&T that have more than 100 million subscribers to their name, and which post impressive profit margins on a very regular basis. Up until now, and despite its aggressiveness, T-Mobile has not yet managed to make a dent. Especially galling for Masayoshi Son is that it is Sprint which, in this ambiguous stage of it merger with T-Mobile, is the one that has supplied most of the customers that allowed the Deutsche Telekom subsidiary to grow! Free/T-Mobile could of course continue to grow, at the expense of Sprint. But, 1) Sprint, which has not engaged in a price war in recent months, could play its trump card by making a sharp turnaround and 2) there is always the possibility of an investment from Dish, this time in Sprint, and even of a merger between cable giant Comcast (which is currently in the process of merging with Time Warner Cable) and Sprint (through an MVNO agreement that would complete the cable market leaders’ impressive Wi-Fi base). The allocation of AWS3 frequencies in the autumn, and the auctions for second digital dividend spectrum (600 MHz band) scheduled for 2015 will also go some way in determining the market’s future, without us yet knowing for sure whether the FCC will give the smallest operators a leg up.
Julien GAUDEMER, Consultant at IDATE
The volume of NFC transactions is estimated by IDATE at 4.6 billion EUR in 2014 to reach 53.8 billion in 2018
In its latest report, IDATE provides an overview of the mobile and online payment market. It provides the main figures for each market segment (in-store payment, carrier billing, remote online payment). The latest market trends are analyzed, as well as the position and evolution of the main players (especially Telcos and internet Players).
Mobile payment markets are still nascent for the most part, the technical aspects are mature and plenty of commercial offers exist. However, the majority of online and mobile payments are still made by debit or credit card while in-store payments are still made by cash, cheque or payment card.
• IDATE estimates that e-commerce is a 1,145 billion EUR market generating 34.8 billion transactions (according to CapGemini) in 2014. M-commerce has generated 115 billion EUR in revenues, through 29 billion transactions including about 13% of alternative payment systems (other than payment cards).
• Regarding in-store payment with NFC mobile solutions, IDATE estimates that 278 million NFC-enabled mobile phones will be used in 2014, and 28 million users are likely to use their NFC phone to make mobile payments. The volume of NFC transactions is estimated by IDATE at 4.6 billion EUR in 2014 to reach 53.8 billion in 2018. All these figures have to be compared with the few hundred trillion USD of global payment transactions per year. If the figures show differences between these markets, other stakes need to be taken into consideration to better understand the overall market payment ecosystem.
• Regarding carrier billing systems, this market is estimated by IDATE to reach 18 billion EUR in 2014, with about 30% of direct online carrier billing.
From the user point of view, the mobile wallet battle focuses on ease of application and added value compared to payment by debit card. Most mobile wallets currently available are no easier to use than a debit card, and do not have the critical mass to be used at a large scale.
Julien Gaudemer, Project leader of this report, says “The main added value is the other services included in the wallet: loyalty programmes and offers management.” However, some players try to reduce the overall payment process in-store: Apple initially developed iBeacon technology for in-door geolocation but it could be used to automatically pay for goods when leaving the store. Alternatively, PayPal has developed payment during ordering (e.g. for the Mc Donalds application) to avoid the in-store payment step.
• Mobile wallet applications can now manage various payment cards, loyalty programmes and offer coupon storage to make them more attractive than traditional payment systems. These features allow service providers to get users’ purchasing habit data in order to provide targeted advertising and offers. In addition, players that are already involved in the advertising market (like Google) are able to increase advertising prices due to a better targeting technique
• Internet giants and new mobile payment players are trying to change the traditional payment ecosystem to gain more revenue. The payment market itself does not bring as much in revenues globally, which is why they are especially trying to bypass all intermediaries between themselves and the user’s money. For instance, Paypal wants to avoid payment systems (like Mastercard and Visa), banks and telcos. Google uses its mobile operating system Android to provide an integrated payment system (using NFC) and a mobile wallet, avoiding telcos and other related intermediaries (like Trusted Service Management services). From the merchants’ perspective, payment service providers need to convince them to adopt their solution: transaction commissions and interchange fees are therefore the key stake as, if they are too high, merchants will not use them. Besides, the recent development of the virtual currency “BitCoin” has been seen as an innovation for some observers but as a threat for the financial sector by others. Many small players have developed new services around the new currency to convert it into traditional currencies or use it on a mobile device or in-store.
Director of Wireless Business Unit
By the end of 2018, we forecast that overall LTE-Advanced subscriptions will represent 45% of LTE subscriptions worldwide, representing more than 927 million subscriptions.
IDATE’s latest report details what LTE-Advanced brings to Mobile Network Operators and how it will help overcome the challenges of providing higher throughputs to more users. After detailing operators’ deployment strategies, it presents the different features of LTE-Advanced and its roadmap before dealing with what 5G could look like. Operators’ strategies are evaluated as well as the benefits and challenges which the features of LTE-Advanced help to overcome.
LTE-Advanced is way richer than just carrier integration, but implementation and deployment will take more time
• While 2013 only saw early LTE-Advanced deployments in South Korea, 2014 should see more and more operators jumping on the bandwagon, motivated by the improvements which LTE-Advanced brings to both operators and users.
• Carrier aggregation is the main feature advertised and LTE-Advanced is often boiled down to, or mistaken for, carrier aggregation, although it is just one of the many features LTE Release 10 and later bring. LTE-Advanced improves spectrum efficiency: 1.4 to 1.6 times better than on LTE Release 8.
• In a spectrum-constrained environment for operators, carrier aggregation enables operators to bring more throughput and capacity by just reusing available spectrum. Services enabled by carrier aggregation are Cat 4 throughput, i.e. throughputs up to 150 Mbps in the downlink but no improvement for the moment in the uplink.
• Cat 4 throughput in itself is not specific to LTE-Advanced, since it can also be reached by just using 20 MHz of contiguous spectrum. In South Korea, the service is called ‘Wideband LTE’ and is not to be confused with carrier aggregation which only starts with LTE Release 10.
• In most advanced markets, 2014 will even see the beginning of services based on the aggregation of two sub-carriers of 20 MHz each and enabling Cat 6 throughput in the range of 300 Mbps in the downlink and still 50 Mbps in the uplink. Basebands and devices will be available shortly on the market. As early as 2015, carrier aggregation of 3×20 MHz sub-carriers will be achieved to provide throughputs of 450 Mbps.
• In the end, carrier aggregation will most probably be adopted quite rapidly by operators.
• Other important features of LTE-Advanced are designed to mitigate interference in small cell scenarios, increase performance at the cell edge, increase spectral efficiency through beamforming and higher-order MIMO. Those features have been trialled by some operators and should be deployed little by little, essentially as densification of the network via small cells is undertaken by operators.
Other features such as Relay function or Device-to-Device will be partially implemented in Release 12 but the real gist of these two functions will rather be found in Release 13, which is expected to be frozen by 3GPP (stage 3) in December 2015. Those functions are essentially meant to enable services for public safety forces that are looking to transition from specific TETRA and TETRAPOL networks to latest mobile broadband technology but with critical mission capabilities.
Samuel Ropert, Project Leader of this report :"On the market side, in 2018, 420 million automobiles will be connected; representing a 57% CAGR on the 45 million connected vehicles in 2013."
In its latest report, IDATE analyses the connected car strategies of manufacturers, mobile carriers and application providers. The study provides the main drivers and barriers for connected car market take-off. It describes the connected car ecosystem, in terms of applications, implementation techniques and also related business models.
A ‘connected car’ is one equipped with access to the Internet (the network of networks) whereby it can communicate with the outside world. This allows the car to share Internet access to other devices both inside and outside around the vehicle.
“The strategy of most manufacturers is to make their cars connected.” Says Samuel Ropert, Project Leader of this report. “The main driver here is based on the regulation related to safety issues in Europe and the underlying revenue opportunity for them. In the USA, the recent GM announcement to embed 4G modules in all new cars is seen as a key trigger for market take-off.”
Three main technical solutions exist. The embedded module system (in the car itself) is the most technically advantageous system as it has a dedicated system for connected services. The next option consists of the use of the smartphone for connectivity tethering, with the technical limitation (use of the miniature antenna). The last model is a combination of the first two other models (use of embedded system for telematics and smartphone tethering for entertainment (mobile Internet-like services). Ultimately, it is an opportunity for a fundamental shift from a largely capex model to a more opex-oriented one, even potentially shifting the focus of manufacturers’ core businesses to embrace a new focus on car-based products and services.
For telcos, the revenue opportunity could be interesting as the connected car will generate traffic that telco will charge indirectly (through the automobile manufacturer). All main M2M mobile carriers are involved in the connected car space, as the connected car represents one of the major markets in volume. In a context where their traditional mobile revenues are flat and even declining in some regions, providing mobile connectivity in cars is a key business opportunity for telcos. Beyond car-related applications in driver assistance, from the perspective of a telco, the car can be seen as an additional cellular device, with a potential high-consumption service profile with such usage as the mobile Internet, entertainment on demand and mobile hotspot features.
The prime business model remains the traditional wholesale relationship (B2B2C), even though AT&T unveiled a retail data plan for Audi A3 in early March and AT&T is expected to announce a new version of its share plan by the summer 2014 which includes the connected car.
For Internet players, the strategy here is clear: the automobile is an additional connected device just as smartphones, tablets and laptops and needs to be addressed. However, Apple and Google do not have really the same approach. Indeed, whereas Apple aims to introduce its technology to interface with its products, Google is promoting the embedment of its technology into the car as a regular device. Google also wants to collect data to provide the most accurate advertising as possible, such as a related point-of-interest, based mainly on location.
On the market side, according to IDATE, in 2018, 420 million automobiles will be connected; representing a 57% CAGR on the 45 million connected vehicles in 2013. Nevertheless, this growth is not homogeneous for each category of connected cars. The embedded systems will lead the market with 222 million units by 2018.
In 2018, the connectivity revenue for connected cars will exceed 8 billion EUR. This encompasses direct connectivity through embedded systems but also the indirect revenue related to smartphone usage. The major issues to be raised here are on the real willingness of the user to pay for such services. To encourage users to subscribe, telcos and manufacturers are already contemplating different revenue models including share plans. All the same, adoption is likely to remain limited over the next five years.
If you want more information on the study "Connected Cars".
IDATE’s latest report explores telecom carriers’ strategies with respect to Content delivery networks (CDN). It analyses the impact of telcos’ arrival into the CDN value chain, especially with respect to pure-player CDN companies and equipment suppliers.It concludes with an analysis of the market that telcos can expect to capture over the long term, especially in the realm of mobile solutions which today are few and far between.
Telco CDN: strategic business for telcos and two-sided market enabler
As internet traffic continues to grow, spurred in large part by video consumption, most incumbent carriers have become engaged in a strategy to deploy their own content delivery network (CDN), which is integrated into their access network. Telcos will use a fixed CDN for their internal purposes, to improve the quality of the content services they distribute. This allows them to earn revenue from users, notably on managed services like IPTV, to offload traffic and to reduce their network expenditures. As to mobile networks, we have not really seen any native mobile CDN solutions as yet, but rather fixed solutions adapted to mobile systems. We are nevertheless starting to see initiatives from mobile equipment suppliers such as Samsung and Ericsson, in partnership with Akamai.
Operators are using telco CDN as a way of shoring up their two-sided market strategies, by generating new revenue streams, notably from OTT vendors. In other words, operators are looking to to be both a both technical and economic solution to their development issues. But the way they are positioning their CDN is somewhat tentative, and they are struggling on the sales end of things when targeting media or internet companies, as both have a range of alternatives for distributing their video services, such as paid peering.
An increasingly complex CDN value chain
The direct competition that telco CDN are facing has more or less required them to embrace coopetition, and create partnerships with their rivals. Traditional CDN players developed their solutions to target telcos, offering CDN resale and managed CDN solutions as well as licensing schemes. Some operators, such as AT&T and Orange, stumbled when initially rolling out their own CDN, before turning to more long-established CDN players as partners, in particular via distribution deals.
So CDN market competition has heated up since telcos entered the fray, and become full-fledged links in the newly revamped CDN value chain. They are part of what is now a complex ecosystem where players often occupy dual positions:
• telcos are both rival and customer for long-established CDN players, in both the retail and wholesale markets;
• with respect to internet companies, telcos may be both their wholesale supplier and their retail market competitor;
• equipment manufacturers are also positioned in the value chain, targeting client telcos and competing with traditional CDN companies.
The CDN market is in the throes of a second wave of consolidation, which will result in an even more competitive environment as telcos acquire traditional CDN players, a case in point being Verizon’s recent takeover of EdgeCast.
Expected boost from mobile traffic and non-video services starting in 2016
Telco CDN accounted for a mere 0.7% of the global CDN market in 2013. But the long-term outlook is good, and they are forecast to grow by 90% annually over the next five years. 2016 is expected to be the year that operator CDN really take off, spurred by growing distribution on mobile networks and distribution of non-video content. By being indispensable players in the mobile ecosystem, telcos will be able use CDN to optimise traffic on cellular systems. The creation of CDN federations also opens up new opportunities for CDN market players to expand their footprint.
Tiana RAMAHANDRY, Consultant
Head of the radio technologies and spectrum practice, Idate
In its latest report, part of the Spectrum service, IDATE details existing spectrum allocation for public safety services. It presents the requirements for broadband services and the corresponding spectrum needs of public safety users. The use of commercial LTE networks by public safety users is analyzed and the mobile broadband strategies for PPDR players are evaluated.
Public protection and disaster relief (PPDR) is the general designation given to a range of public safety services broken down into: Day-to-day operations (category ‘PP1’) or routine operations; large emergency and/or public events (category ‘PP2’) for larger events; and disaster relief (category ‘DR’) caused by either natural of human activity. PPDR is not a commercial service.
- Current non-broadband PPDR systems mainly use the 400 MHz and the 700-800 bands worldwide. Spectrum above 1 GHz supports also a variety of PPDR operations for temporary use only.
- Regarding spectrum requirements, PPDR users face the challenge of different interests within countries whether or not spectrum should be reserved for PPDR applications.
- Broadband-dedicated PPDR spectrum is expected to be allocated mostly in the 700 MHz with complementary frequencies below 1 GHz for specific countries (800 MHz) and above 1 GHz (1.4 to 5 GHz frequencies). At 700 MHz, coexistence is mainly with television broadcasting/digital TV and commercial broadband networks in Europe.
- According to PPDR user groups, a minimum of 2 x 10 MHz for broadband PPDR spectrum should be reserved, similar to what was allocated in the USA. Additional country specific spectrum needs to be calculated.
- The question of allocating broadband PPDR spectrum through auctions is also being debated.
PPDR services can be provided through dedicated PPDR systems or commercial cellular networks.
- The challenge is to enhance the LTE and LTE-Advanced standards to meet PPDR requirements. However, in the short term, extended LTE and LTE-Advanced capabilities and standards (Direct Mode, Proximity Services and Group Communications System Enablers, resilience and VoLTE) will not be in operation.
- Dynamic use of shared broadband PPDR spectrum with predictable QoS is also a key potential capability considered through Temporary Licensed Access (LSA/ASA).
In conclusion, we have identified the following options for PPDR players wishing to get access to mobile broadband capabilities :
1. Build and run an own dedicated broadband PPDR network
2. Use a dedicated broadband PPDR network run by a private operator
3. Use a narrow band PPDR network + MVNO agreement for broadband services
4. Use a dedicated commercial mobile network or Use a standard commercial mobile network
5. Use a dedicated commercial mobile network which operates specific PPDR spectrum
Potential candidate bands for broadband PPDR spectrum by region
More information about "Public Safety Report" study.
Round-up for 2014
It’s hard, in the first editorial of the year, to avoid laying out the overriding themes that we expect to see play out over the next twelve months. But it is still too early for me to deliver a complete summary of the year gone by, which has become the much-anticipated task of our DigiWorld Yearbook.
You will also need to wait until the next Executive Note to find out the central topic selected for this year’s DigiWorld Summit (but you can already mark your calendars for November 18, 19 and 20).
What I can share with you, however, is our belief in the profound relevance of certain issues, by summarising three topics that we have chosen to explore in this year’s Collaborative Research Programme (CRP 2014). These are think tanks open to existing IDATE member companies and those wanting to join, who will work for close to a year with a dedicated team of our analysts on the following subjects:
Telecoms USA: model or counter-model?
Following thorough on the two projects carried out in Brussels in 2012 and 2013 on telcos’ new business models, and the new European policy options being considered, we will work to deepen our understanding of the specific points that explain the different directions being taken on either side of the Atlantic.
The internet of things: will everything be connected?
We are going to analyse the true potential of the internet of things, by taking account of the developments that need to occur in the technical environment, difficulties in generating income from both consumer objects and industry applications and, finally, governance and personal data ownership issues, with tie-ins to our 2013 think tank on personal data
What will tomorrow’s TV and video networks look like?
Here we are building on the 2013 Video as a Service think tank by exploring issues surrounding the future of television and video distribution networks, and by analysing long-term scenarios for the delivery of TV and video products, taking particular account of the cooperation and convergence between networks, i.e. hybridisation involving both fixed and cellular networks
Other topics may be added to the CRP. For instance, we are contemplating an ambitious project that aims to define what could be a comprehensive, metropolitan area-scale digital investment strategy, going beyond marketing clichés and segmented vertical approaches.
I can also tell you that the next issue of Communications & Strategies (DigiWorld Economic journal) will be published in March, and is shaping up to be a promising one. It will be devoted to scoring Europe’s telecommunications sector, and examining potentially clashing policies.
And, finally, a reminder that the best way to delve into the subjects that are consuming our teams is though the reports that we publish every month as part of our annual Market Research programme.
Lead Analyst, IDATE
M2M is enjoying swift growth of roughly 30% in volume and over 10% in revenue, with the market to reach €40 billion in 2017
The 6th edition of IDATE’s M2M Market report, covering 2013-2017, reveals that a healthy growth rate has finally taken hold in this promising but, up until recently, underperforming market. This performance is being spurred by increased use within the main areas of application (automotive, consumer electronics and utilities) and is expected to accelerate even further over the next five years as M2M spreads to other sectors of activity.
The M2M market (Reported devoted to M2M applications, excluding satellite M2M) represented 175 million modules worldwide in 2013, generating €24.2 billion in revenue, which translates in to an annual growth rate of 31% in volume and 11% in revenue. The bulk of revenue was generated by software and IT developments which together accounted for two-thirds of total market value.
IDATE forecasts that global M2M market volume will grow by an average of close to 30% annually between now and 2017, which corresponds to 470 million modules, while market revenue will climb by 13% a year on average, to reach €40 billion.
Europe will be the biggest market in terms of revenue, ahead of North America, even if Asia-Pacific will continue to dominate in terms of volume. At the end of 2013, China rose to the number one spot in number of cellular M2M modules installed, overtaking the United States.
World M2M cellular market, 2013-2017
Million of modules Revenues (billion EUR)
Source: IDATE, December 2013
Over the next few years, the M2M market’s growth will be shaped by three key verticals: automotive, consumer electronics and utilities
While they will theoretically drive the market, certain barriers could nevertheless obstruct their growth. Several long-awaited applications in these key markets have been repeatedly delayed, such as Europe’s eCall regulation and large-scale rollouts by utilities. Added to which certain technical choices can have a tremendous impact on the market, a good example being smart meters connected to the cellular network through a concentrator that would allow large utility companies to further increase their already massive negotiating clout to drive down per-unit prices. But utilities will dominate the M2M market in 2017 in terms of module numbers, all technologies combined. The rise of M2M in consumer electronics will have a major impact on the market as a whole, especially on the number of active modules. Because it is a de facto mass market, consumer electronics will represent the largest number of modules, all technologies combined.
M2M players seeking business opportunity beyond their core expertise
The market offers M2M application providers with very attractive opportunities, despite the already relatively low and declining average revenue per user (ARPU). The projects have a long lifespan, very low churn rates and average contracts representing several thousand SIM cards. Connectivity alone is expected to represent €10 billion worldwide in 2017, and more than 3% of European telcos’ mobile data revenue. MVNOs are being pushed out of the market and so repositioning themselves as platform providers, while module providers will have to adapt to a market where unit prices are in free fall. Meanwhile, the top telcos are exploring new cloud and big data services that would allow them to find solid and sustainable new business opportunities.
This comprehensive M2M report will be followed up over the coming months with other reports with a specific end use or vertical focus. For example, just after Mobile World Congress, there will be a very topical report on connected cars.
Consultant at IDATE
Selon l'IDATE, le marché mondial du jeu vidéo (marché des équipements compris) passera de 53.9 milliards EUR en 2013 à 82.1 milliards EUR en 2017 (+11.1% en moyenne par an). Deux raisons expliquent cette dynamique :
• début des cycles de vie des dernières générations de consoles portables et de consoles de salon;
• progression remarquable des segments de jeux sur terminaux nomades et de jeux en ligne.
La Game Summit Conference 2013, qui s'est tenue le 21 novembre dernier à Montpellier, a permis de dessiner les différentes tendances auxquelles devra faire face les différents segments de marché dans les prochaines années.
Retrouvez le programme et les intervenants du séminaire Game Summit Conference
Les consoles de salon dans la tourmente
L'IDATE estime que la nouvelle génération de consoles devrait connaître un rythme de croissance moins important que celui observé pour la précédente génération. Les consoles subissent en effet une concurrence de plus en plus vive issue des segments du jeu nomade et du jeu en ligne.
Évolution du marché des consoles de salon, 2001-2017 (millions EUR)
Source : IDATE d’après Industrie - Etude multiclients "Marché mondial du jeu vidéo" – Novembre 2013
Les consoles de salon font aujourd'hui face à des défis de taille pour s'adapter aux nouveaux usages des joueurs:
• Financer davantage de jeux indépendants: La situation actuelle du jeu sur consoles de salon est comparable à celle que connut l'industrie du cinéma dans les années 80. Ce fut l'époque où le cinéma indépendant commença à s'imposer sur le marché face aux grands studios hollywoodiens, ces derniers n'ayant ainsi d'autre choix que de se lancer à leur tour dans la production de films indépendants. Pour Alexis JOLIS DESAUTELS, Game Director, Ubisoft Montréal, il est indispensable pour le jeu vidéo sur consoles de salon de financer davantage de jeux indépendants en sus des blockbusters, au risque de s'asphyxier.
• Faire face à un environnement déflationniste: De par l'influence du segment du jeu sur mobile, les joueurs sont aujourd'hui familiarisés avec l'idée que les jeux vidéo peuvent être acquis gratuitement ou pour des sommes très peu élevées. Comment arriver dans cet environnement à ce que le consommateur perçoive la valeur d'un jeu AAA à 70 EUR? Il faut pour cela que les jeux sur consoles puissent durer en moyenne un an et demi. Il s'agit là d'un enjeu majeur de développement. "Challenge is how to create perceived value" (Alexis JOLIS DESAUTELS, Game Director, Ubisoft Montréal). Pour l'IDATE, le jeu sur consoles de salon doit également songer à faire évoluer son modèle économique pour se diriger vers le Free2Play.
• Intégrer des composantes sociales: Le succès du jeu social montre l'intérêt des joueurs à jouer avec d'autres personnes. Aujourd'hui, 60% des joueurs jouent avec des personnes qu'ils connaissent. Il apparaît donc crucial aujourd'hui que les consoles de salon intègrent des composantes sociales.
• Ne pas rester uniquement des appareils statiques sous le téléviseur: La prééminence des tablettes et des smartphones, le succès du jeu nomade, témoignent de l'intérêt des joueurs pour les appareils portables. Les joueurs veulent aujourd'hui payer pour quelque chose auquel ils peuvent accéder partout. Dans ce contexte, les consoles de salon doivent évoluer pour ne pas rester uniquement des appareils statiques sous le téléviseur. Pour l'IDATE, l'ubiquité offre là des perspectives intéressantes.
Enjeux économiques et technologiques des jeux ubiquitaires
Un jeu ubiquitaire offre la possibilité à un joueur de vivre une expérience ludique en continu sur plusieurs plateformes. Sur les différentes plateformes, les expériences peuvent être substituables ou complémentaires.
Caractéristiques des jeux ubiquitaires
Source : IDATE - 2013
Dans les jeux proposant des expériences substituables d'une plateforme à une autre, gameplay et business model sont répliqués à l'identique sur les différentes plateformes. La prochaine étape pour les éditeurs sera de les adapter aux spécificités de chaque plateforme ainsi qu'aux comportements des joueurs, qui s'avèrent différents d'une plateforme à une autre. Par exemple, Scimob, éditeur du jeu 94 secondes, a remarqué que les joueurs jouaient plus longtemps sur tablette que sur smartphone, et pense monétiser ce comportement en ajoutant un système d'attente sur tablette.
Dans les jeux ubiquitaires offrant des expériences complémentaires d'une plateforme à une autre, les applications "compagnon" peuvent être utilisées de manière synchrone ou asynchrone au jeu "principal". La synchronisation en temps réel laisse présager un fort potentiel ludique, néanmoins des progrès technologiques restent encore à faire afin de résoudre les problèmes de latence rencontrés aujourd'hui.
TV connectée et second écran: le potentiel du jeu vidéo comme outil d'engagement du téléspectateur dans les programmes audiovisuels
De plus en plus, les téléspectateurs utilisent un ou plusieurs écrans supplémentaires tout en regardant la télévision: ordinateurs, smartphones et tablettes, mais également liseuses numériques ou consoles de jeu. Que font-ils sur les seconds écrans? 53% effectuent des activités qui ne sont pas relatives aux programmes diffusés à la télévision: consultation de mails, recherche d'informations diverses, etc. Les 47% restants réalisent des tâches en relation directe avec le programme diffusé: recherche d'informations sur les acteurs, recherches d'informations relatives au programme, commentaires sur les réseaux sociaux, etc.
Part des téléspectateurs effectuant les activités considérées sur leur second écran
Source: The NPD Group, 2013
L'enjeu pour les chaînes de télévision est d'arriver à concevoir des interactions 2nd écran engageantes avec leurs programmes télévisuels, afin de préserver l'attention de leurs téléspectateurs et in fine leurs revenus publicitaires.
Selon Dean FOX, CEO, ScreenAngels, le jeu vidéo serait tout à fait à même de proposer ce type d'application: "Who can design and develop synchronized, multiscreen, interactive programming for TV and the second screen? We can". Il évoque à titre d'exemple le jeu Psychic Detective (EA), dans lequel le joueur doit mener une enquête policière. Associé à une série policière télévisuelle, ce type de jeu serait à même d'encourager le téléspectateur à suivre avec encore plus d'attention la série.
L'importance des analytics pour le développement des jeux en ligne et des jeux nomades
Dans le secteur du jeu en ligne et du jeu nomade, des outils spécifiques comme Flurry Analytics permettent de recueillir des statistiques sur le comportement des joueurs. Pour un éditeur/développeur, l'intérêt est de pouvoir comprendre le comportement des joueurs, de valider/corriger ses choix de développement rapidement ou encore de détecter les éventuelles frictions dans le jeu. Pour un éditeur/développeur, il est notamment intéressant de connaître: le comportement de l'ensemble des joueurs, exception faite de ceux nouvellement arrivés; le comportement des joueurs qui viennent de quitter le jeu et qui ne sont plus revenus; le comportement des joueurs-payeurs. Ainsi par ce biais, les joueurs font également partie du processus de développement d'un jeu.
DigiWorld Summit - du 19 au 21 Novembre 2013
Retrouvez les médias enrichis produits pendant la conférence :
- Les comptes rendus des experts de l'IDATE sur notre Blog
- Mapping interactif de la communauté twitter #DWS13
- Vidéos des sessions et interviews sur Vimeo
- Toutes les photos sur flickr
- Slides des interventions sur Slideshare
- Interviews de speakers by Convergence numérique
- Compte rendus storify (tweet + photos) by AgenceOndine