Marie-Astrid mastrid@ptolemus.com +33 1 45 53 36 56 Thank you!

1. PTOLEMUS Consulting Group
Mobile machines - bringing smart
interactivity into the world of
moving machines
Mobile Monday Brussels
Frederic Bruneteau, Managing Director
7th June 2010

2. Introduction
PTOLEMUS is named after Ptolemy, the geographer who
created the first map of the world
2

3. Introduction
PTOLEMUS assists its clients, from strategy definition to
business development
Our areas of expertise Our services
Positioning / Location enablement Strategy definition
including business plan
Navigation development, board coaching and
support
Location-based content
Telematics
& services
e.g. connected car, fleet Strategic due diligence
e.g. maps, traffic, fuel
management, PAYD, road and market assessment
prices, speed cameras,
charging, e-call
weather, parking, etc.
Intelligent transport systems Innovation management
including product & services
Mobile content and social networking, e.g. application development and launch
stores, content sourcing, crowd-sourcing
M2M Business development
including response to RFPs
Connectivity (sourcing, MVNO, ESP, etc.)
3

4. Smart machines
We will focus today on mobile, connected, machines
MOBILE PTOLEMUS area of focus, NON-MOBILE
CONNECTED GEO-CONNECTED MOBILITY
IT
INDIVIDUALS MOBILE MACHINES MACHINES
EQUIPMENT
Cars, motorbikes, bikes, Vending machines,
Mobile phones, PNDs, airplanes, ships, trucks, light PC, working stations, meters, digital
cameras, game consoles, etc. vehicles, building equipment, servers, etc, photoframes, printers,
farming equipment... etc.
NON-CONNECTED
Today's focus NON-CONNECTED
4

5. Smart machines
In which industries will mobile M2M develop?
Transportation & logistics Retail & distribution Hospitality
Automotive Energy & mining Construction Consumer
Emergency services Health Surveillance & security
5

6. Smart machines
Most machines cannot be considered as smart
Machines are dumb
• Can do only one thing well
• Do not listen
• Do not speak
• They are often too slow
• Have limited processing power
• They do not understand us
• They do not adapt to us, we
adapt to them
• Do not change their behaviour i.e.
do not learn / repeat the same
errors
6

7. Smart machines
However, machines are starting to follow the path of our
most important machine, our mobile phone
The best of mobile handsets for M2M
• Our mobile phones hold a growing part
of who we are: they know when we get
up and go to bed, who we call and talk to,
what is our diary
• This growing intelligence is spreading to
more and more objects, from cars to
fridges to lampposts
• The mobile phone brings to the M2M
industry:
- Miniaturisation,
- Unexpensive modules / smart cards
- Storage capacity
- Standards and economies of scale
- Improved battery life
- Profitable 2G networks and
worldwide coverage
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8. Smart machines
Mobile machines are not like us
We appreciate Machines prefer
1. Splashy, highly luminescent screens 1. To avoid displays, which consume
power
2. Interaction with other human beings
2. As little interaction as possible to avoid
3. To change our electronic devices every consuming data bundle
2 years
3. To stay alive for 10-30 years
4. Beautiful user interfaces
4. Straightforward, remote interfaces
5. To visit a doctor when we are ill
5. Remote diagnosis and maintenance
6. Spontaneous gestures and contacts
6. Automated responses and processes
7. To spleep at least 8 hours a day
7. To be active 24/7
WE LIKE NEW, ORIGINAL AND THEY LIKE HIGHLY EFFECTIVE, DURABLE
EMOTIONAL THINGS AND COLD SYSTEMS
8

9. Smart machines
Despite a common belief, machines will not consume most of the
mobile network bandwidth
Machines
Digital connected
photoframes,
which consume
10x as much as a
mobile phone, are
the exception
Sources: Cisco, PTOLEMUS 9

10. Smart machines
Of the 16 billion machines in Europe, probably 5 billion are
mobile, so M2M is clearly about volumes
Active wireless M2M SIM cards in Europe What is driving volumes?
Penetration rate of total machines: • Fast decreasing cost of 2G network
from 0,13% in 2010 to 0,38% in 2014!
(GPRS / EDGE) connectivity
• Fast decreasing cost of data-only
In millions In billions
80 40
roaming tariffs
Number of connections
• Fast decreasing cost of GSM data
Number of machines
60 30
modules
• Fast decreasing cost of GPS
40 20
chipsets
• Decreasing cost of SIM cards
20 10
• Key projects, often regulatory-
driven (eCall, opening of electricity
0
2007 2008 2009 2010 2011 2012 2013 2014
0 market, etc.)
Sources: PTOLEMUS, M2M Magazine 10

11. Smart machines
Machines are becoming (much) smarter
They can reflect... They can feel...
Microprocessors MEMS
They can speak... They will know where they are
SIM cards Multi-bearer
connected modules A-GPS SIM cards
11

12. Smart machines
The evolution of species
Connected
High Layering
Die-cutting
machine train
machine Airplane
Elevator Tractor
Connected Connected
car truck
Server
Parking
metre
Laptop
Air
Fridge conditioning
system
Local Smartphone
device Fixed
phone
intelligence Connected
copier
WiFi
Cash router Connected
register PND
Oven
Traffic light Connected
photoframe Connected
vending
Washer machine
Lawn mower Connected
Connected watch
videocamera
Connected
Low Hairdryer plug
Toaster
Low Total solution intelligence High
Source: PTOLEMUS 12

13. Smart machines #
However, this connected intelligence will not always come
from the cellular network
An increasing number of bearers are available Key factors of selection
• ADSL / cable / fibre can work • Amount of data exchanged
when a synchronization is possible
• Possibility of synchronization?
and when large data exchange is
required • Regular or bursty data exchange
• WiFi can also provide unexpensive • Cost
connectivity
• Availability of economic modems
• Bluetooth and / or devices
• RFID is well adapted to logistics • Ability to integrate with vertical
and industrial requests application
• GPRS, 3G and soon LTE • Supplier competition
• Sustainability of suppliers
13

14. Smart machines
At last, machines are starting to talk to us... and to listen
There is someone to talk to in the car!
• Text-to-speech: the device
provide voice route guidance,
reducing user distraction
• Speech recognition enables the
user to indicate his destination
for an increasingly large
number of operations
Garmin embedded device for Citroën
14

15. Smart machines
Machines are even helping us when we are in trouble
Machines are our friends
• Peugeot launched a joint eCall / B-call
service in 2003, starting with high end
models.
• It now has over 800 000 cars equipped
with the functionality.
• Since 2003, roadside assistance has been
provided 3 500 times, including 2 000
times for an automated emergency call.
• Peugeot recently decided to broaden the
scope of the service by pricing Peugeot
Connect at only €290 and making it
accessible to entry-level cars such as 207
and 308.
• The service provides assistance in local
language on a 24/ 7 basis. It is now PSA's eCall system
available in 10 countries.
15

16. Smart machines
Machines can now learn from the same machines
Itinerary based on estimated
speeds • With IQ Routes, TomTom uses
historical speed data to provided
improved routing
• This data has been generated by
millions of PNDs in last 3 years -
This itinerary actually lasts
29 minutes connected through TomTom HOME (i.e.
DSL / cable)
• TomTom devices have brought 800
billion measurements
The shortest itinerary at this time
takes actually 26 minutes • Rather than using estimated speeds,
TomTom devices use these actual speed
profiles to route drivers
Source: TomTom 16

17. Smart machines
Progress towards the connected car is a unique opportunity
for wireless M2M
The wireless M2M industry
2013 estimated revenues for selected telematics markets
will benefit from a number of (Europe, € in millions)
key projects
126.000
25.000
• The connected car vision Non-connected
is about to become a Connected
reality 20.000
• Telematics vendors can
address new multi-billion 13.000
15.000
market opportunities
- Embedded in-car 18.000
navigation 10.000
- Roadside assistance
- Fleet / asset tracking
- Car insurance (PAYD) 5.000 7.700
9.500
• Connected solutions can 460
1.654
3.750
encroach on significant 2.047 2.548
1.070 1.500
3.000
existing industries 0 0 0
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18. Smart machines
Smart mobile machines are coming
• Boundaries between "our" machines and other machines are blurring
• The path towards connecting 16 billion machines is just beginning
- Machines are becoming part of an ubiquitous intelligent network
- Growth potential is enormous
• Contrary to mobile, it will not be about ARPUs but about volumes (at
least at the connectivity level)
• The ability to show and align all players towards clear and large
vertical revenue opportunities such as eCall is key to generate these
volumes
• In the end, we expect fixed M2M / telemetry to become a particular
case of wireless M2M
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19. Mobile Monday offer
PTOLEMUS will publish next week its
2010 European Location Study
• 150 pages of our expertise about the location
industry, built on
• Interviews with over 100 executives from all sides
of the industry, from Admob to Yahoo!,
• Over 6 months of desk research and primary
research, notably an online survey,
• A detailed market model so as to combine
strategic and technology analysis with hard
figures
If you wish to r
eceive the free
information, ju version, or wan
st give me you t to have more
r business card
after the confe
rence
19

20. PTOLEMUS Consulting Group
Strategies for Mobile Companies
Brussels - Paris - London
contact@ptolemus.com
w w w. p t o l e m u s . c o m
Frederic Bruneteau
Managing Director
fbruneteau@ptolemus.com
Twitter: PTOLEMUS