Networked Society Lab Report Overview
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In the past 30-40 years, the world has experienced a change greater than that of the industrial age. We are now at a critical moment – an inflection point – where the next wave of innovation in the form of mobile, broadband, and cloud will be the catalyst for an entirely new economic model. Welcome to the Networked Society.
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Networked Society Lab Report Overview
- 1. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 1 Networked Society 2015
- 2. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 2 More connections 1900 20102000 10 30 50 15 years 26 billion connected devices 25 years 5 billion connected people 100 years 1 billion connected places 20 40 Connections(billion) 2020 Our vision 50 billion connected devices
- 3. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 3 2010 2014 More communication Voice 130 Data 160 Voice 210 Data 2300 CommunitiesInternet surf MessagingOffice services Entertainment content Apps
- 4. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 4 1991: Total Cost $3054.82 2015: Smartphone $299.00 More function
- 5. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 5 Every day $13 million crowdfunding $2,7 billion e-commerce 133 million hours YouTube video watched 2.7 billion photos posted 328 million app downloads 2.7 billion likes on Facebook 700,000 new internet users NEW BEHAVIORS
- 6. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 6 Exponential Innovation
- 7. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 7 Power based INNOVATION
- 8. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 8 ICT BEYOND THE INFLECTION POINT INSTALLATION TRANSFORMATION
- 9. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 9 Exponential Innovation ACCELERATING ICT PERFORMANCE DATA & INFORMATION WEALTH BROAD ACCESSIBILITY & USEFULNESS ROBOTICS SENSORS BIG DATA INDUSTRIAL BIO-TECHNOLOGY SMART MATERIALS AUGMENTED BODY ANALYTICS NANO WEARABLES INTERNET OF THINGS 3D PRINTING VISUALIZATION VIRTUALIZATION CROWD SMART ENERGY
- 10. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 10 The age of empowerment
- 11. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 11 Drivers of change Engaging culture Convenience of services People empowerment Efficiency advancements Immersive experiences Market innovations Productivity development Diversity and inclusion Sustainable paradigm
- 12. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 12 From TRANSPORTATION to mobility “I always get a suggestion for a train where I can be sure to get a seat “ “I always share my car travel with others” “I prefer taxis with drivers recommended by my community” TRANQUILIEN BLA BLA CAR UBER
- 13. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 13 From RETAIL to exchange “I save time and money by subscribing to my grocery supply” “When traveling I usually stay at a home away from home” “In my neighborhood we share lots of stuff that’s good to have but seldom used” BLUE APRON AIRBNB YERDLE
- 14. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 14 From EDUCATION to learning “Learning has become a lifelong experience” “My education and pedagogic method was totally personalized” “I got my Masters degree on-line” COURSERA KNEWTON UNIVERSITIES
- 15. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 15 From media to culture “I have my personalized media streams with me everywhere” “I have never bought a CD” “I produce as much as I consume” YOUTUBE SPOTIFY CREATE SPACE
- 16. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 16 From banking to transacting “I use my mobile for everything I buy” “I got my project founded by crowdfunding” “I have high trust points at my bank so I get a lower interest” MOBILE MONEY KICKSTARTER FIDO
- 17. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 17 From Utility to Function “Energy systems are much more effective now. We have smart apps that control how much we spend” “You know, you might not need all the energy you produce” “We have a footprint bonus system based on how much resources you consume” STOCKHOLM ROYAL SEAPORT IKEA SOLAR PANELS SUMO
- 18. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 18 From Public sector to Communality “It takes less than 17 minutes to start a new business and get all the paper work in place” “Today we are all engaged in the local community” “We collaboratively wrote a new constitution” E-ESTONIA FIXMYSTREET ICELAND’S CONSTITUTION
- 19. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 19 From Healthcare to Wellness “My medicine boxes remind me to take my medicine” “My fitness center takes care of my health better than the traditional hospital” “I’m constantly updating my health records, monitored by wearable technology” GLOW CAPS LECOM NOOM
- 20. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 20 A New Logic
- 21. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 21 New logics HEALTHCARE WELLNESS EDUCATION LEARNING TRANSPORT MOBILITY
- 22. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 22 New assets 1. Digitalization – exponential and ubiquitous 2. Data – own, shared and open 3. Things – connected and intelligent 4. Users – participating and active 5. Platforms – economics and scale 6. Capabilities – available and on- demand
- 23. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 23 Industry transformation PATH OF EVOLUTION PATH OF DISRUPTION OUTSIDE DRIVERS INSIDE CONTROL
- 24. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 24 Ict-led TRANSFORMATION DISRUPTION OUTSIDE BETTER PERFORMANCE OF CURRENT OFFERING IMPROVED OFFERING TO CURRENT MARKET SYNERGY OFFERING ACROSS INDUSTRIES PROFOUNDLY NEW OFFERING CREATING NEW MARKETS INSIDE EVOLUTION
- 25. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 25 INDUSTRIES IN TRANSFORMATION DISRUPTION OUTSIDE INSIDE EVOLUTION
- 26. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 26 Operator opportunities DISRUPTION OUTSIDE Smart Metering ERP Cloud Systems M2M Platforms Smart Appliances Connected Car Mobile Money Connected Home Media Partnerships INSIDE EVOLUTION
- 27. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 27 education EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL Personalized learning E-universities Gamification E-books On-line learning Wisdom of the crowdConnected schools Digital school platforms On-line information
- 28. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 28 MEDIA EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL P2P sharing Digitalizing processes Streaming Web publishing User generated content Digital libraries Digitalizing processes Apps Mobility Social media InteractivityDigital experience
- 29. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 29 TRANSPORTATION EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL Self-driving car as a service Car / ride sharing e/m-ticket Smart navigation Traffic management National e/m-ticket Connected car Collaborative logistics Dynamic transport service
- 30. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 30 BANKING EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL Mobile money New currencies Digital identity Crowdfunding P2P lending Crypto transactions New transaction platforms E-banking Automated trading Loyalty programs Mobile banking
- 31. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 31 UTILITIES EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL Smart grid Home generation Real-time information Smart metering Micro grids Information exchange Smart street light Distribution monitoring
- 32. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 32 RETAIL EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL Servicification Self-service payment Price search engines Maker movement Collaborative consumption E-store On-demand local production Loyalty analytic Crowd buying CRM Smart logistics
- 33. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 33 PUBLIC SECTOR EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL Citizen participation Direct democracyMobile voting E-citizen services Awareness services City operation center Surveillance and security New identities Cyber warfare Transparency
- 34. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 34 HEALTHCARE EVOLUTION DISRUPTION OUTSIDE DRIVE INSIDE CONTROL Connected medicine Wearable E-health services Remote surgery Remote diagnostic Global data mining National health records services Remote outsourcing AI support DNA-profile treatment
- 35. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 35 New practices needed 1. Digitalize business resources 2. Make sense from data 3. Establish networked practices 4. Encourage user co-creation 5. Develop new platforms 6. Innovate in the service business
- 36. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 36 We enable change makers
- 37. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 37 › Connected Vehicle Cloud based on Ericsson’s Multiservice Delivery Platform . › Allows drivers, passengers and the car to connect to services available in the cloud, e.g. information, navigation and entertainment apps. › Volvo Cars will be able to open parts of the platform to other actors in the eco-system of the automotive industry Volvo car group
- 38. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 38 › Transporting 3 + million containers on vessels globally. › Implemented a total end-to-end communications solution for 350 vessels. › Cut fuel costs and increased the value of Maersk's logistics › Boosted fleet management capabilities and reduced CO2 footprint › Tighter monitoring of cargo delivery times Maersk Line
- 39. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 39 › Connected lighting solution which integrates mobile network equipment into light poles › Creates a sustainable, climate-positive district and an attractive living and working environment › Offers city officials an innovative way to afford next generation energy efficient LED lighting to meet sustainability goals, and enabling network operators to offer improved city-wide mobile broadband and app coverage Philips
- 40. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 40 Stockholm royal seaport › C40 Climate Positive Development Program › Free of fossil fuels by 2030 › Carbon emissions to be reduced to less than 1.5 tonnes per person by 2020 › SRS to be adapted to future climate changes › Climate-smart and efficient infrastructure connecting 10,000 homes and 30,000 workspaces
- 41. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 41 Technology for good CITY OF CURITIBA REFUGEES UNITED CITY OF MUMBAI CONNECT TO LEARN
- 42. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 42 FURTHER INTO THE Networked Society
- 43. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 43 Transforming SOCIETY OPPORTUNITIES CHALLENGES › Step change efficiency › Market effectiveness › One planet agenda › Knowledge advancements › Global community › Innovation drive Future of work Wealth distribution Power concentration Integrity & Privacy Digital resilience Inclusion › › › › › ›
- 44. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 44 ICT Creating society benefits Education Health Inclusion Productivity Competitiveness Resources Pollution Climate change PEOPLE PROFIT PLANET Economic Progress Environment Progress Social Progress
- 45. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 45 In 2030… New buildings generate more energy than they consume 3D printing and drone delivery provides close to real time supply Millions of people have a life expectancy of 150 years or more Food is grown in skyscrapers Cash is all digital and virtual currencies capture a large share of GDP Actors are out of work, replaced by animated artists Learning a second language is no longer necessary You don’t need to drive your car unless you want to
- 46. Networked Society Lab | © Ericsson AB 2015 | January 2015 | Page 46 a new golden age A Networked Society where every person and every industry is empowered to reach their full potential.
Notes de l'éditeur
- Introducing the Networked Society story 2015
- 2
- Slide 3: More communication To understand this change further, it is important to understand what “more communication” really means. In the Networked Society, we consistently observe that increased connectivity is matched with an even more intense level of communications. To demonstrate just how intense this can be: in 2010, 160 petabytes of mobile traffic traversed mobile networks every month, but by 2015, that figure is 2300 petabytes per month. Originally, we used our mobile subscriptions strictly for voice. This evolved and by 2010 voice and data were roughly equivalent in terms of global mobile traffic volumes. Now, the things we do with our connected devices are so much more diverse than they used to be. Indeed, a large amount of voice traffic now runs over data networks through VoIP, as even voice has evolved to become data.
- Slide 4: More function As we know, much of this explosion in data traffic has been driven by the functionality and ubiquity of the smartphone. Consider this advertisement from electronics retailer Radio Shack back in 1991. Apart from the radar detector and the three-way speaker with subwoofer, the functionality of all the remaining items – ranging from a CD player to a video recorder and answerphone – is now crammed into the average smartphone. That’s over $3,000 worth of equipment that would once fill your living room, now in the palm of your hand.
- Slide 5: New behaviors Together, more functionality and more communication are driving new behaviors that many of us now take for granted – from the $13 million generated in crowdfunding to the 133 million hours of YouTube watched, or the 2.7 billion Facebook likes each day. The numbers here are staggering, of course, but the really important change is the vast amount of new opportunities for people, business and society.
- Slide 6: Exponential innovation The exponential rise in everyday communication represents more than the sum of its parts. It’s delivering a fundamental change in the way things get done.
- Slide 7: Power based innovation Think of a factory floor, typical of the industrial age – perhaps you’re picturing something like the assembly line in the picture on the left. Products emerge from an extremely efficient line of workers. Each person has their own specific role and needs only the tools for that specific task. The first factory floor was actually more like the one we see in the picture on the right, and was a rather inefficient production process. This is because the power source of the factory machines could only be configured in one way, making it impossible to create an efficient production system. But as technology evolved to allow configurable power sources, factory owners began to understand the new possibilities, and the assembly line came to life. We are now standing at a similar point in time in the evolution of ICT.
- Slide 8: ICT Beyond the inflection point The past few decades of ICT progress have undoubtedly been instrumental to change, but much of what we experienced was made up of incremental improvements along the way. After all, whether you’re using a fixed-line or mobile device for voice calls, you’re still just using a phone. But when we look at ICT beyond the inflection point, we see that social networks represent a real departure from the telephone. In addition, new ways of sharing many types of physical goods and consuming digital content (such as music and video), are causing a reimagining of the very idea of ownership. We’re seeing the emergence of a mindset that is less about ownership and more about access. This change is enabled by what we call ‘general purpose’ technologies. Steam, coal, iron and railways were general-purpose technologies of the industrial age. Their significance became more important as they stretched into other industries and started to bring about society-wide transformation. In today’s ICT world, our general purpose technologies are mobility, broadband, and the cloud. They have passed the “first installation-phase” curve and are now on their way to the transformation stage. They are becoming the foundation for all other areas of society to operate and innovate upon. All have broad applicability going far beyond the ICT industry that created them, and they are starting to drive transformation. As the assembly line and factory worker were the culmination of the old industrial age, the new general purpose technologies are leading to increasingly exponential productivity.
- Slide 9: Exponential innovation These three general purpose technologies – mobility, broadband, and cloud – are also delivering exponential innovation. It’s happening in industrial bio-technologies, smart materials, sensors, 3D printing, the Internet of Things (IoT), smart energy, robotics, analytics, and visualization. That’s why we hear the word ‘disruption’ so often today. In fact, it’s hard to find any area that’s not being advanced by these general purpose technologies. In our view, exponential innovation is driven in three unique but overlapping ways: Accelerating ICT performance: Moore’s Law continues to hold true, and exponential processing power is reaching practically every device. Whether you call it IoT or smart devices, the acceleration that emerges from this ever-more connected world is driving rapid innovation. Data and information wealth: In a hyper connected world, technology is no longer passive. It generates exponential data, enabling insight and intelligence that goes beyond what was possible with our past, relatively static relationship with our environment. Broad accessibility and usefulness: As these general purpose technologies become more accessible, what was originally the preserve of big corporations and research institutions is now available to ordinary people, who can experiment with them in their homes. Intelligence and insight critical to innovation is becoming consumerized, with major implications.
- Slide 10: The age of empowerment Globally, and through society, new behaviors are being established and old trends are gaining scale and depth through ICT.
- Slide 11: Drivers of change We believe the drivers of change can be grouped in three areas: people, business, and society. Starting at the macro, society-wide level, we observe big trends, ranging from urbanization to greater diffusion of power and an rising scarcity of resources, all of which are being addressed by ICT. Furthermore, ICT has the ability to deliver social progress on critical issues such as productivity, diversity and inclusion, and sustainability. ICT business drivers are being fuelled by trends such as the mobile workforce, big data, and connected devices, including products ranging from cars to smart meters. This, in turn, is leading to radical advancements in efficiency, whether it’s across the production line or in the back office. The interaction with customers, subscribers and users is becoming increasingly immersive, and it has the potential to build loyalty and engagement at levels that even the ‘Madmen’ of 1950s and ’60s could not have imagined. At an individual, people level, we see how technology is enabling increased capability for collaboration all around us. It has set our expectations for things to happen at light-speed. Our ability to seek and explore new ideas through technology is also giving us a new sense of purpose. This is driving us toward a highly engaged culture, demanding more convenience from our services. We are empowered like never before. The drivers of change are today redefining our relationship with the industries and institutions that form the critical infrastructure of the nations and communities in which we live.
- Slide 12: From transportation to mobility In many countries, our experience of transportation has undergone significant change. For examples, we see services such as Tranquilien, which puts its customers in control with the ability to ensure they have a seat on the right train. BlaBla Car is among a number of car sharing services that liberate people by enjoying the benefits of driving without the hassle of ownership. In time, we are likely to see the success of taxi services, such as Uber, being defined by the communities they serve. Transportation, in essence, becomes mobility.
- Slide 13: From retail to exchange Similarly, in the retail arena, personalization is just as important, and the relationship is much more about exchange of value than straightforward consumption. On one hand there’s a company like Blue Apron, providing a service that combines the convenience of microwave meals from the last century with the importance of freshly prepared homemade food so critical to a healthy lifestyle. On the other hand is Yerdle, which takes the idea of sharing to an entirely new level, by allowing its users to swap practically anything for free. In the middle, Airbnb is seriously challenging the hotel industry by giving people the comforts of a true home away from home.
- Slide 14: From education to learning Finally, the very idea of education is being turned on its head through ICT, empowering practically anyone to gain access to the best learning resources on the planet. These resources are personalized to an individual’s own needs, rather than determined by a system that demands uniformity. Coursera, Knewton, and a range of online universities are redefining the idea of learning and development.
- Slide 15: From media to culture Over many years, media content has moved from a passive, top-down experience to one that is all encompassing and less bound by timing, format or ownership. Consumers of media content are now also creators, distributors and commentators. This shift from media as something manufactured and controlled to something that is a core part of consumer culture is exemplified in platforms and services such as YouTube, Spotify and Createspace. The latter, in particular, crosses a range of media content, empowering people to become their own publishers of books, music and film.
- Slide 16: From banking to transacting The bottom-up, peer-to-peer driving capabilities of ICT contrast starkly with a sector exemplified by command and control institutions. Banking has endured a period of significantly low-levels of confidence, but is now undergoing a massive transformation, as it moves back to the core of what it has traditionally delivered – the ability for people to transact. This user-driven transformation sees the rapid growth of mobile money, which in many developing countries has brought banking to the unbanked. In Kickstarter, we see investment not determined by financiers but by an active community of online investors who see potential beyond a quick return on investment. Indeed, Fido is a bank that takes community to the next level by engaging its customers in peer-to-peer decision making. There are no financial advisors in Fido, as they believe managing money should fun.
- Slide 17: From utility to function While utilities, by their nature, might not be seen as ‘empowering’, ICT is starting to have a profound impact both in the delivery and consumption of critical services. As renewables, including solar and wind, come online and into the grid, power production becomes more distributed. In turn, ICT offers new approaches for increasing efficiency as well as handling supply and demand. In fact, with smart energy systems of the likes you see in Stockholm Royal Seaport – where smart apps control usage and spending – the meaning of the term utility moves from a provider of energy to its true definition as the ‘function’ of energy. For IKEA, ICT has helped solar panels become a much more mainstream proposition. Sustainability Momentum (SuMo) is an example of how employee engagement can be a powerful tool for educating workers on energy use. The system is based on tools designed to record, manage and analyze an organization’s carbon footprint. SuMo can be installed on workers’ computers, enabling them to monitor and update their contribution to an organization’s sustainability goals.
- Slide 18: From public sector to communality While public sector organizations offer government services, in many areas the core purpose is to serve the communities within which they stand. All too often, we hear about the inefficiency and bureaucracy of public services, but the ICT-led transformation is again turning things on its head by empowering citizens to play a greater role in this move from public sector to ‘communality’. Through E-Estonia, described as one of the most advanced ‘e-societies’ on the planet, entrepreneurs in Estonia have found that the paper-work and cumbersome process of starting a new company has been dramatically reduced. Today, it takes less than 17 minutes to start a new business. FixMyStreet is an independent website, built by the UK charity mySociety, which makes it easier to report problems in the local community. Local governments that support FixMyStreet can offer citizens the ability to quickly report issues ranging from dumped rubbish to overhanging trees and broken street lights. While Iceland’s Constitution was not ultimately put into place, the original approach offers a strong pointer to how governments can use ICT to help co-create policies with their citizens.
- Slide 19: From healthcare to wellness Perhaps one of the most profound impacts of ICT-led empowerment is in the area of healthcare. Moreover, this proactive approach to health shifts the dynamic from healthcare provision to one oriented to wellness or well-being. Hence we are seeing apps and devices such as Glow Caps and Noom. The former is helping millions of people in the US stay on top of prescription medication, while the latter automatically updates healthcare records. Other healthcare organizations, such as Lecom, which rewards patients for staying fit and healthy and supports this through a state-of-the-art facility, offers both medical advice and a fitness center.
- Slide 20: A new logic If our ideas of transportation, retail and education are being transformed at a personal level, we can only begin to imagine how this is impacting businesses, institutions, and industries at a macro-level.
- Slide 21: New logics There is a new logic being applied across industries. As previously mentioned, the music industry was one of the first to completely change, from a physical goods delivery industry to a digitally connected one. Other industries are now set to follow. The new logic will allow new capabilities that are part of the ICT revolution to gradually evolve or disruptively change industries. Examples of these capabilities include: The shift from physical products to service delivery (such as Netflix or Spotify) The major influence from consumers before, during, and after purchase (such as crowdsourcing or instant customer feedback) Connected things with the possibility for everything in and around a value chain to communicate (such as connected transport packages) In fact, the very concept beneath industries can be transformed. Think of transportation becoming mobility, retail becoming exchange, and education becomes learning. Or think of healthcare moving from being perceived as a reactive treatment of illness to a proactive securement of wellness.
- Slide 22: New assets Much like the industrial age, the Networked Society represents a fundamental paradigm shift for people, business, and society. The key enablers of growth and innovation come not from the physical assets and infrastructures themselves, but from the people, platforms and insights that are leveraged to reinvent them. We define these new assets in six key areas: Digitalization – exponential and ubiquitous: As digital assets rise in importance and become primary sources of business value, we will see business process become faster, more relevant, and cost-efficient. Data – owned, shared, and open: Big data that is collected and analyzed from practically every aspect of life has tremendous potential to improve decision- making. As we continue to harness data, whether it’s owned, shared, or open, it will continue to become a powerful resource. Things – connected and intelligent: We are now entering a reality where billions of digitally connected objects are the equivalent of raw materials for much more dynamic products. They are, in turn, enhanced by a wealth of new services that improve product performance and achieve new levels of efficiency. Users – participating and active: In world defined by greater transparency and distribution of power, people will continue to become active contributors to the networks and communities in which they participate. This will lead to new forms of co-creation where products and services become more relevant and users are viewed as vital assets for any public or private organization. Platforms – economics and scale: Technology platforms are transforming the idea of a product or service by opening up entire business processes to customers, developers, and partners to add value. This not only reduces transaction costs but has the potential to become an economic force with a logic of its own. Capabilities – available and on-demand: Starting a global business today requires little more than an idea, a user base, and a network of collaborators. Funding can be crowd-sourced; factories can be rented; and specialized skills, work spaces, and digital infrastructures can scale as needed. As a result, many more barriers to market entry and global scale will be lowered.
- Slide 23: Industry Transformation We are increasingly hearing the mantra; disrupt or disappear. In reality, we can see different levels of change across industry; from evolutionary to disruptive. As ever, there are internal and external factors at play but through the path of evolution and disruption, across industries we are seeing the broad reaching effects of ICT.
- Slide 24: ICT-led transformation To put ICT-led into a more nuanced context, we can plot the types opportunities that arise across the spectrum of evolution and disruption and the extent to which the changes occur more inside or outside of the industry. Better performance of current offering: The opportunity exists to significantly improve the performance of the current market offering. This has been the mainstay of ICT, but will remain ever true in a world where the core, general purpose technologies become even more accessible. Improved offering to current market: There is a real opportunity to achieve gains in market chain effectiveness. ICT should be viewed as a tool to improve your current market offering. For example, look at the value chain and see how things can be made more effective in the route to market. Synergy offering across industries: ICT is used to reshape the value system and here we see organizations reaching outside their immediate expertise and building synergies with other industries. Profoundly new offering creating new markets: Industries where the entire ecosystem has changed have no doubt already seen much of this ICT-led transformation on their doorstop. The opportunity exists to use ICT to innovate like never before and create profoundly new offerings.
- Slide 25: Industries in transformation Our observations and interactions with various industries led us plot them as follows: Bottom left: ICT is enabling a higher degree of efficiency across the value chain for many industries, including health and utilities. For example, smart meters are enabling new energy companies to significantly reduce waste. Top left: In sectors such as retail and transport we are seeing ICT deliver a sea change in the way products and services are delivered. Bottom right: Education and banking are not only becoming more accessible, but also driving greater empowerment. ICT is enabling these great institutions to completely rethink their notions of value. Top right: Media, as an industry, has been so easily digitalized and is an example of change through ICT. In fact, the creation, distribution, and consumption of media content is in many ways unrecognizable from 15 to 20 years ago.
- Slide 26: Operator opportunities For operators, we see the following opportunities to position themselves in the four quadrants: Top left: Operators have the possibility to improve the functionality of their existing offerings. Top right: In this quadrant, it is essential to drive innovation by creating new services (such as e-commerce). Bottom left: Convenience, standardization, and operational excellence are the key ingredients for success in delivering general purpose technology, such as standard communication and connectivity services, to consumers and enterprises. On top of that, operators can deliver connectivity systems to improve the performance of existing services, such as electricity, water or gas with smart metering, or to provide smart appliances in the household (such as washing machines and dishwashers). Bottom right: By developing insights about the potential for ICT to reshape processes and practices, operators can support different industries in their transformation journey. They can do this, for example, by delivering horizontal ICT platforms that enable the interaction of different industries (such as NTT or T-Systems) or machine-to-machine platforms that help industries develop the potential of the IoT market.
- Slide 27: Education Where, when and how we learn is radically changing. ICT is opening up a number of different practices and approaches to learning. Bottom left: The shift towards e-books is, in itself, driving huge efficiencies in terms of inventory management. When we think of how a range of previously paper-based systems become digitalized, we are essentially witnessing a transformation of the very infrastructure of a school or learning environment into a digital platform. Top left: Beyond digitalization we start to see a new opportunity to improve the effectiveness of education and learning. For example, gamification of learning becomes much more plausible and we not only see this in schools but in other areas of public service such as broadcast. BBC Online is a great example of interactive, ‘gamified’ learning. It doesn’t end here though. Connected schools transform the community aspect of education as parents become more engaged and teachers can draw on expertise from beyond their immediate school or learning establishment. Bottom right: The fast emerging e-universities offer a glimpse into how higher education no longer needs to be restricted to educational establishments. The opportunity lies in connecting learning and development across other industries where very specialist skills are needed. Top right: The very concept of education becomes transformed further when we start to look at how deeply ICT can be embedded into the process of learning. Firstly, it becomes entirely feasible to have a curriculum based purely around the needs of an individual. Here we see how a highly tailored learning experience designed around the individual can help students develop at their own pace, based on their own strengths. And it means that learning providers themselves can create unique offerings that are integrated around the individual. For example, someone who is strong in mathematics but less so in physics can have a unique learning system delivered by a range of providers, but designed to ensure balanced progress in both areas.
- Slide 29: Media While this is perhaps the sector that has been most radically transformed by ICT, when we zoom into media as a whole, there are in fact different levels of change: Bottom left: Undoubtedly, the most immediate change we see in media is how much more efficient the value chain has become through the digitalization of all processes in media production and delivery. For example, the cost of production and distribution of digital music today is exponentially more efficient than even 10 years ago. Top left: The shift to digital offers the opportunity to create a range of different offerings and services that improve media content both in terms of production and delivery. Whether it’s the digital experience or an alternative approach to publishing, constituents across the media value chain have the ability to become far more effective. Bottom right: The pace of change in media content is reflected in the range of new and existing providers we see on the market today. Whether it’s newbies like Netflix offering video streaming or traditional supermarket retailers also delivering these services, the core value system for media content is becoming increasingly reshaped. Top right: While digitalization improves efficiency of the value chain, it also redefines the media ecosystem as a whole. Social media is a prime example of how the value and potential of content is open to numerous players both at an industry and an individual level.
- Slide 29: Transportation Transportation is shifting from products to services and from owning to sharing. The industry as a whole might be going through a more evolutionary path of change but again, when you zoom into the sector, it’s possible to see how varied things can be. Bottom left: ICT is delivering immediate benefits in terms of day-to-day improvements, which include electronic or in some instances mobile tickets (e/m – ticketing) which remove the need for inefficient paper based systems. Traffic management systems are also becoming vastly improved, both in terms of speed and efficiency, through software-controlled platforms. Top left: Connected cars represent a vast opportunity for manufacturers to improve their current offerings, both in terms of the post-sales customer care, but also in areas such as in-car entertainment. E/M tickets that are connected to a national system mean that providers can create a range of value-add offerings that link different transport systems together. Bottom right: Smarter navigation systems open the door to a range of adjacent industries to capitalize on the transformation taking place in transportation. For example, restaurants and other businesses can tap into an API linked to a connected car and offer road travelers live information about their services. Top right: As we enter the world of self-driving cars it is possible to see how the very concept of transportation changes and in turn creates entirely new markets. So while you may well see a self-driving car from the doctor come tocollect you for an appointment, in the wider world of logistics, it’s possible for entire supply chains to be seamlessly connected across a global transportation hub.
- Slide 31: Banking It’s possible that the mainly electronic nature of banking and finance today means we are standing at a point where this industry is set for transformation similar to that which media has experienced. This is being driven by the bottom up-model of the crowd, the rise of mobility, and the arrival of new currencies that challenge old institutions. Bottom left: In this section we have for many years witnessed the transition to services such as e-banking, digital identities and trading of a kind where deals are increasingly initiated by an algorithm. Top left: ICT has also brought huge leaps in terms of the ability to define highly personalized and valuable loyalty programs designed around the customer. Mobile banking is now taking this to the next level by allowing us to access our account, anytime and anywhere. Bottom right: Mobile money and crypto-currencies represent the new frontier and one where we are only starting to see the potential of synergies across different industries. For people in emerging markets, mobile money is the first experience of banking, but in fact it’s far more than that. Like Bitcoin and other crypto-currencies, mobile money challenges the very system of value exchange between individuals and organizations. Top right: This ‘upending’ of the whole system of transaction is even more apparent in the platforms that we see today, including crowdfunding and P2P lending. Here banking is being taken completely out of its existing paradigm, leading to entirely new markets of value creation. This new type of transaction behavior is something we are only just starting to realize.
- Slide 31: Utilities ICT has the potential to radically transform what many might consider the relatively slow-moving sector that is utilities. A constant flow of information between energy provider and consumer, the emergence of micro-grids, and the incorporation of renewables is creating a new value logic for the utility sector. Bottom left: For many people, smart metering probably represents an ‘about time’ moment, where usage and bills are put more closely at their finger-tips. It also offers energy providers a much smarter way to monitor how existing services are deployed and to quickly identify issues such as outages or gaps in capacity. Top left: If smart systems represent one side of the opportunity and improve the existing offering, the overall market potential from an ICT-led transformation is vast. For example, smart technology allows utility providers to learn how to incorporate renewables in their smart grids and deliver innovations such as smart street light systems. Bottom right: When utilities become an ICT platform the potential for synergistic offerings across other industries improves dramatically. For example, there is the potential to allow other brands that have a far stronger connection with consumers to incorporate energy into their offering. But the potential reaches further. It presents new approaches for entire industries, such as transportation, to partner much more effectively with utilities firms and build greater efficiency into their systems. Top right: Ultimately, as we move into a world where individual homes start generating their own energy, the very role of a utility firm is transformed. For example, when customers become partners in the delivery, maintenance and management of the grid infrastructure, utility firms have the opportunity to become consultants or advisors.
- Slide 32: Retail As ever, the retail industry is quick to embrace the potential for deepening customer relationships, which is why many of the changes we see cover the full spectrum of ICT transformation today. The increased transparency in areas such as price and product comparison, coupled with a renewed focus on local production and ability to purchase directly from a global market has transformed the commercial ecosystem. Bottom left: For certain constituents in the retail industry, CRM, logistics and e-store systems are probably in their third of fourth generation of change. Nevertheless, with each change, we see a new level of performance within their existing offering, from better inventory management to customer service. Top left: Across the market, we see ICT delivering a new level of value to customers. Whether it’s self-service checkouts in the supermarket or improved loyalty schemes based on the individual purchasing behavior, we are seeing a new definition ofthe term “smart shopper”. Bottom right: The real breadth and scale of transformation in retail can be witnessed today in ICT’s ability to galvanize both those across the supply chain and those at customer level. Price search engines have changed the ability to determine the products and services best suited to our needs and led to a new level of transparency from those that offer them. Trends such as crowd buying extend this types of empowerment further by giving retailers and customers the ability to shift the value dynamic from one-directional to a new form of cooperative. Top right: Collaborative consumption and the maker movement, while still relatively nascent in terms of impact, represent the future direction of retail. This is not only something that speaks to a more sustainable way of living, by putting production in the hands of the people, but potentially, with future scenarios such as on-demand local production, it could redress some of the negative aspects of globalization.
- Slide 33: Public sector Transformation in the public sector is clearly a vast opportunity for redefining the role of government. New tools for civic participation radically improve possibilities to contribute and participate in new ways – enabling public services to engage with citizens, and helping citizens to influence and participate in governmental processes. However, in the majority of scenarios, failure to change can have big consequences. Bottom left: Public sector organizations across the world have for many years been evolving their existing services and offerings through ICT. As a result, there are notable benefits in areas such as e-citizen services and security. Top left: Through the cumulative impact of ICT in the public sector, we are experiencing in many instances greater awareness of what’s on offer, as well as transparency in how it is delivered. For example, in most developed markets at least, people today can go online and discover the services their taxes pay for and more directly scrutinize how effective those taxes really are. Bottom right: Citizen empowerment can ultimately be taken to the next level when the public sector is integrated across other private sector industries. For example, the battle against cyber war is one that all organizations must tackle and through an ICT-led transformation, law enforcement and business can more effectively address this problem. Top right: Ultimately, ICT could help overcome many of the challenges of participative democracy, empowering more direct involvement of citizens in important policy decisions. What happens next can itself be profoundly transformative.
- Slide 34: Healthcare Transformation in the healthcare sector comes at a critical time, where globally many systems are faced with increased strain brought by aging populations and rising costs. People have access to a vast library of information online, and the rise of wearables and other applications on their smartphones enables them to more easily monitor and manage their wellbeing. Coupled with new players entering the market, this sector is changing radically. Bottom left: Digitalization is already being implemented to improve performance across existing healthcare offerings, ranging from the streamlining of health records to remote surgery. Top left: While ICT has a role in helping evolve the specific functional aspects of healthcare, it can also shape the overall offering. For example, connected medicine helps reverse the current centralized model for healthcare by putting the patient at the center of delivery. This in turn offers a more holistic approach to health, where a patient can select from a range of services at their own convenience. Bottom right: As an increasingly globalized world deals with the threat of pandemics, ICT steps in to offer a much more cohesive approach for tackling such issues. Global data mining in particular allows us to track, monitor and more effectively manage the spread of diseases, not to mention predicting their impact. Top right: Wearable technologies present the first shift in healthcare becoming something that can be proactively managed by the individual.
- Slide 35: New practices Systemic change is necessary to realize the full advantages of the Networked Society. At Ericsson, we see six core shifts or new practices that we believe can help companies and other organizations sustain this change: Digitalize business resources: As processes and products become digitalized, organizations are increasingly adaptable to a changing environment, enabling increased innovation, strengthened decision making and value creation. Make sense from data: Real time data analytics are empowering individuals and decision makers alike to make informed decisions based on user information. Establish network practices Network-focused management practices are critical for delivering scalable digital platforms and services, empowering a better understanding of how to prioritize owned, managed, and shared resources. Encourage user co-creation: Digital networks make co-creation and collaboration easier through online communities, and businesses and governments can now improve relationships with customers and citizens using digital products and services. Develop new platforms: The inevitable transformation of business will be led by a new economic model driven by technology, with powerful business platforms based on search, social media, and e-commerce. Innovate in service business: A collaborative approach from governments, businesses, and communities will fundamentally drive different models based on networks that will lead to societal transformation and more powerful innovation. Over the next few decades, with these practices in place, we will see significant changes in society.
- Slide 36: We enable change makers When we look at the various industries and examples, we see that this change is real. From an Ericsson perspective, we are proud to be part of this change.
- Slide 37: Volvo Car Group One example is our Connected Vehicle Cloud, where we have collaborated with Volvo Cars. While this provides infotainment, apps, and communication services, Volvo is also able to open aspects of the platform to other players in the automotive industry ecosystem. This means that third party service providers (such as infotainment providers, road authorities, cities, and governments) can offer Volvo drivers with real-time, actionable information on the move.
- Slide 38: Maersk An additional example is our work with Maersk Line, the world’s largest ocean carrier. Delivering the largest fleet of cargo ships, Maersk sought a communications platform to provide end-to-end remote management to aid its shipping processes. Through our capabilities, we were able to aid the build-out of the world’s largest floating mobile network, with 350 connected vessels monitoring data in real time, providing the company with information that incrementally contributes to future innovation.
- Slide 39: Philips Focusing on the societal impacts of technology innovation, our work with Philips revolves around network densification in outdoor city environments. In doing so, we have evolved small cell solutions that integrate within street light polls and create an attractive living and working environment for citizens while also delivering the very best in data communications. The solution enables optimal network coverage in the most sustainable and energy efficient way, and has additional societal benefits such as better safety thanks to brighter streets, without damaging the local environment.
- Slide 40: Stockholm Royal Seaport Another notable example of social progress is the Stockholm Royal Seaport. This project has ambitious plans to create an urban district of 10,000 apartments and 30,000 workspaces that are both climate-positive and free of fossil fuels by 2030. An underlying smart grid system will connect apartments, meters, buildings, vehicles, and harbor facilities – all powered by an open technology platform. From this platform, new applications can be built for city management and smart street lighting, as well as transport, education, and health services. Residents will take an active part in this change, contributing to improved traffic planning and government services, while adjusting energy and water consumption patterns to reduce peaks in demand. As the developed world continues to account for the majority of environmental waste and consumption, holistic approaches such as these will be necessary for citizens to become knowledgeable contributors and collaborators, rather than simply consumers, in a more sustainable ecosystem.
- Slide 41: Technology for good While Volvo, Maersk, Philips, and Stockholm Royal Seaport exemplify the potential of ICT-led progress in developed countries, there are numerous examples of its transformational impact in the developing world. The City of Curitiba in Brazil was the first in the world to connect public buses to a mobile-broadband network. In doing so, it has not only provided a more reliable bus service – used by 70 percent of public and private commuters – the system produces only 200 thousand tonnes of CO2 emissions per year, compared with the 1.5 million tonnes previously generated by annual car travel. Thanks to the use of smart meters, the Municipal Corporation of Greater Mumbai has been able to improve supplies of water and now provides more resources to a larger proportion of the population, leading to a 50 percent cent reduction in wastewater. This was a city plagued by manmade water shortages a few years ago, which left a quarter of its 20 million residents without a water supply. Other life changing examples of ICT in action include Refugees United, a not-for-profit organization that, with support from Ericsson, has used a mobile platform to help families torn apart by war to reconnect with one another. Another example, Connect to Learn, is an initiative of Columbia University’s Earth Institute and Millennium Promise, together with Ericsson, with specific focus on benefits for girls and their education needs. Since 2010, Connect to Learn has supported UNESCO’s commitment to education for all girls, by deploying mobile, broadband, and cloud solutions, combined with hands-on ICT training, to schools in 14 countries, with more to come.
- Slide 42: Further into the Networked Society A progressive society enables us to further reimagine the purpose of the industries and institutions that serve us. Where health becomes wellness; wellness delivers a self-healing society; education becomes learning, leading to self-liberation; transport becomes self-organizing mobility; and so forth. However, as we know from history, new technology brings with it both new opportunities and new challenges.
- Slide 43: Transforming society In this slide, on the left, we see the true potential of the Networked Society, but on the right are some of the big questions that will face us on this journey, which we need to address. The more ICT challenges that face existing institutions, the greater the demand for new legal, commercial, and social frameworks. For example, through continued automation, we may well see a step change in efficiency and productivity but, as has happened before, this will lead to bigger questions about the future of work. Similarly, market effectiveness will drive increased profits, but as we are increasingly aware, we also face a growing gap between income and wealth distribution.
- Slide 44: ICT creating societal benefits These opportunities and challenges point to a wider ICT-led societal transformation. It is one that encompasses social, economic, and environmental progress. Together, these three factors make up what has become known as the triple bottom line (TBL), a forward-looking approach for measuring growth and success beyond traditional concepts of profit and loss. John Elkington, a world authority on Corporate Responsibility and Sustainable Development, created the triple bottom approach, arguing that companies should measure performance based on the three different bottom-line principles: profit, people, and planet. Companies and organizations that produce a TBL – such as Ericsson – take account of the full cost of progress, and there is strong evidence that this can be achieved through a focus on the power of ICT. For example, our own Networked Society City Index, developed to better understand the triple bottom line impact of ICT in cities, has continually highlighted how ICT enables resources to be used more efficiently.
- Slide 45: In 2030… As we look to a world a decade after everything becomes connected, it’s feasible to start making predictions for what things might look like in 2030. In our journey of exponential innovation and ICT empowerment, it is possible to start winding forward to a time when it’s quite realistic to expect things like millions of people with a life expectancy of 150 years, food grown in skyscrapers in sufficient quantity to serve big cities, buildings generating more energy than they consume, actors being replaced by animated artists, and people who will never know what it is to drive a car.
- Slide 46: A new golden age As the term implies, a Networked Society is about more than how a network shapes the fortunes of a business or the quality of someone’s life. It is about a society that will fundamentally change the way we innovate, collaborate, produce, govern, and achieve sustainability. In ancient Greek history, the term golden age was used in reference to a period of great inventions, peace, harmony, stability, and prosperity. While the ancient Greeks may not have had in mind such things as 3D printers, smart meters, and self-driving vehicles, the potential outcome from these innovations may well be the same. The Networked Society leans forward, offering a glimpse into a new golden age for mankind, one where every person and every industry is empowered to reach their full potential.
- © 2015, Ericsson AB 2015 34