Accenture Mobility - Trends for the Next Decade
 

Accenture Mobility - Trends for the Next Decade

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From a deck that I presented at the SIIA “All About Mobile” conference in November 2011 in San Francisco. It starts with the usual set of slides on the recent history of mobility (and I will keep ...

From a deck that I presented at the SIIA “All About Mobile” conference in November 2011 in San Francisco. It starts with the usual set of slides on the recent history of mobility (and I will keep presenting them until I see no more “I had no clue” faces in an audience), and then goes deeper into Moore’s Law and how we see it continuing for cell phones.
An additional journey back in history to the early days of the industrialization and electricity. Companies had to generate their own power (by using wind, water, animals, etc.) and Burden’s Wheel is a good example of one big, giant monolithic effort to do so. Along came Tesla and Westinghouse, and the first power plant “Adam’s Plant” was able to provide about 3x the power, but over a much further distance, and to multiple customers. The concept of an electric utility was born, and what we saw happening was the fall of “enterprise power generation”.
Fast forward to 1969, and Douglas Parkhill and John McCarthy came up with the concept of the “Computer Utility”. Today we see multi-$B investments into public cloud infrastructures. In very simple terms, if history in the utility industry is any indicator, we will see enterprise clouds disappear. And as cloud infrastructures scale and get more efficient, and the price of computing goes down (Moore’s Law), developers will find a way to use and instrument that computing power, and make it consumable to enterprises and consumers, which gets us to Jevons’ Paradox.
Jevons observed how consumption of energy in England went up as coal power plants got more efficient. All the way to today where we keep the lights on in our homes 24/7, and darkness has actually become a scarce good in some metropolitan areas. Switching to enterprise computing and looking at BEA data on IT assets for the past four decades, we see that prices for IT assets are falling, whereas other assets follow an inflationary path. And as computing gets cheaper, enterprises consume more and more of it (and you can argue so do consumers, aka “Consumerization of IT”).
What is striking that with the arrival of the public Internet in ‘90-95 and web companies like Yahoo and Amazon, the mix in consumption is shifting: it’s increasingly going towards software, up from a SW:HW ratio of roughly 1:1 over three decades, to now 3:1. So today, for every $1 spent on hardware, enterprises spend $3 on software. Hence, it seems like enterprises are making use of the public cloud, which would explain the rise of SaaS companies, such Salesforce, SuccessFactors and also Amazon’s AWS.
And as the rise of smartphones is only beginning, enterprise mobility will likely drive the trend of an increasing SW:HW ratio further up. I wouldn’t be surprised to see the mix go to 10:1 in the next five years as smartphones proliferate and the amount of on-deck and off-deck computing power available to a single device is growing exponentially, the concept of “accelerated acceleratio

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Accenture Mobility - Trends for the Next Decade Accenture Mobility - Trends for the Next Decade Presentation Transcript

  • Mobility – Trends for the Next DecadeSan Francisco, November 2011Lars KampAccenture Mobility Services
  • Contact Lars Kamp Accenture Mobility Suite 1200 560 Mission Street San Francisco, CA 94105 415.894.5423 lars.kamp@accenture.comCopyright © 2011 Accenture All rights reserved. 2
  • First, some shameless self promotionAccenture’s Five Offers for Enterprise Mobility CMT Financial Products Resources Health & Services Public Service 1 Mobility Consulting Business, Technology and Network Mobility Software Services 2 Applications 3 Devices, Platforms 4 Mobility Managed Services Enable and Operate 5 Mobility Business Integration ServicesCopyright © 2011 Accenture All rights reserved. 3
  • Today’s topics. History Silicon Cloud What’s Next?Copyright © 2011 Accenture All rights reserved. 4
  • Before we start “People tend to overestimate what can be done in one year and to underestimate what can be done in five to ten years.” J. C. R. Licklider, 1965Copyright © 2011 Accenture All rights reserved. 5
  • Back in 2006Copyright © 2011 Accenture All rights reserved. 6
  • HistoryCopyright © 2011 Accenture All rights reserved. 7
  • The start of mobile computing.General Magic Mission Statement, May 1990 – Mountain View, CA “We have a dream of improving the lives of many millions of people by means of small, intimate life support systems that people carry with them everywhere. These systems will help people to organize their lives, to communicate with other people, and to access information of all kinds. They will be simple to use, and come in a wide range of models to fit every budget, need, and taste. They will change the way people live and communicate.”Copyright © 2011 Accenture All rights reserved. 8Source: SEC.
  • Cloud computing in the 90s…“Magic Cap” in 1994, designed to run on distributed server systemsCopyright © 2011 Accenture All rights reserved. 9Source: Wired.
  • Revisited in 2008 with AndroidKey Magic Cap engineers moved on to create Android, iPhone, Flash “Magic Cap” UI, 1994 G1 “HTC Dream” UI, 2008Copyright © 2011 Accenture All rights reserved. 10
  • Android iterating 2x per year … One major dessert every six monthsHistory of Android Oct 2008 Apr 2009 July 2005 Android Market Android Android acquired announced. SDK by Google “G1” released 2005 2007 2008 2009 2010 2011 2012Sept 2003Androidincorporated. … C D E F G H I J … Nov 2007 OHA founded. April Sept Oct May Dec Mar Oct H1“Astro” & “Bender” 2009 2009 2009 2010 2010 2011 2011 2012 “Android” platform unveiled. Cupcake Donut Éclair FroYo GiBr HoCo IC JB v1.5 v1.6 v2.0 v2.2 v2.3 v3.0 v4.0 v5.0? Copyright © 2011 Accenture All rights reserved. 11 Source: Google, Accenture analysis.
  • … with rapid ecosystem adoption One smartphone OEM and SemiCo at a timeAndroidRelease C D E F G H I J April Sept Oct May Dec Mar Oct H1 2009 2009 2009 2010 2010 2011 2011 2012 Cupcake Donut Éclair FroYo GiBr HoCo IceCrm JB v1.5 v1.6 v2.0 v2.2 v2.3 v3.0 v4.0 v5.0?“Hero”Device ? HTC Samsung Motorola HTC Samsung Motorola Samsung ? Dream Behold II Droid Nexus One Nexus S Xoom Galaxy NexusChip Qualcomm Qualcomm TI OMAP Qualcomm Intrinsity NVIDIA TI OMAP MSM7201A MSM7201A 3430 QSD8250 S5PC110 Tegra 2 250 4460 ? 528MHz 528MHz 600 MHz 998MHz 1,000MHz 1,000MHz 1,200MHz Copyright © 2011 Accenture All rights reserved. 12
  • The app store economyCatalog Size – Apple App Store vs. Android Market ~560K Apps in iPhone AppStore ~370K App in Android Market 600 740 Q108 Q208 Q308 Q408 Q109 Q209 Q309 Q409 Q110 Q210 Q310 Q410 Q111 Q211 Q311 Q411Copyright © 2011 Accenture All rights reserved. 13Source: Apple press releases & earnings calls, Google, AndroLib, PCWorld, Distimo, Accenture analysis. Excludes books. All numbers rounded.
  • Early days with Android and iOS App & Mobile Web Usage Growth, US - April 2008 – March 2010 4,000 3,500 32% 3,000 MonthlyAds Requested (Millions) 2,500 Growth (Nov’08-Mar’10) 2,000 1,500 19 % Monthly 1,000 Growth (Apr’08-Mar’10) 500 0 RIM Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Others incl. Palm & Windows Copyright © 2011 Accenture All rights reserved. 14 Source: AdMob Mobile Metrics Report, Accenture analysis.
  • SiliconCopyright © 2011 Accenture All rights reserved. 15
  • Moore’s LawOriginal publication in the April 1965 edition of Electronics Gordon Moore 1965Copyright © 2011 Accenture All rights reserved. 16Source: Intel.
  • “Accelerated acceleration”Calculations per Second per $1,000109108107106105104103102101 1965100 Moore’s10-1 original article10-210-310-410-5 Electromechanical Relay Vacuum Tube Transistor Integrated Circuit10-6 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000Copyright © 2011 Accenture All rights reserved. 17Source: Ray Kurzweil, Accenture analysis.
  • The evolution of cell phones....Shift from basebands to application processors Baseband Processor “Fat Modems” Baseband & Application (aka Modem) Processor Low power silicon for OS-enablement of light High performance, low voice/SMS and long apps running on top power application battery life. of baseband. processors.Copyright © 2011 Accenture All rights reserved. 18
  • … equally following Moore’s LawSmartphone computing power - DMPS per $101 ~3500 DMPS100 ~130 DMPS10-1 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Copyright © 2011 Accenture All rights reserved. 19Source: Accenture analysis based on 27 smartphones from 13 OEMs and 4 SemiCos. Based on unsubsidized retail price at launch day.
  • “Accelerated acceleration”Nvdia Tegra roadmap from MWC 2011Copyright © 2011 Accenture All rights reserved. 20Source: Nvidia press release.
  • Delayering of the silicon industry System porting emerging as the new layer – “connected devices”. 1970s 1980s 1990s 2000s 2010s Vertical ASIC Fabless IP-driven SW-driven Suppliers Vendors Semis Design Design“Texas Instruments” “VLSI Technology” “Qualcomm” “ARM” Various System Design & IP Porting Distribution ASIC Vendor (“Fabless”) IP Design & Fully Vertically Electronic Distribution Integrated: Design Design & Design & Automation Distribution Foundry EDA System EDA Manufacturer (Foundry) Foundry Foundry FoundryRatioHW : SW 1:0 1 : 0.5 1:1 1:2 1 : 2+Engineers Copyright © 2011 Accenture All rights reserved. 21 Source: ARM, Cadence, Accenture analysis..
  • Value in silicon moving up the stack Daily stock prices ARM vs. QCOM, indexed, 01/01/2006 – 11/11/2011600 ARM 486 Index500400 July 2008 ARM announcement that “major OEM” acquired architecture license300200 QCOM 129 Index100 0 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Copyright © 2011 Accenture All rights reserved. 22 Source: Stock data taken from Google Finance. Index excludes any dividend payments.
  • CloudCopyright © 2011 Accenture All rights reserved. 23
  • Burden’s Wheel in Troy (NY), 185162 x 22 ft., 500 hp / 373 KW to Burden Iron Works plant 60 ft. away.Copyright © 2011 Accenture All rights reserved. 24Source: National Museum of American History, Behring Center; Nicholas Carr, “The Big Switch”.
  • Adam’s Plant, Niagara Falls (NY), 18956,700 x 21 x 18 ft., 1,250 hp / 932 kW, to Buffalo (NY), 22 miles away.Copyright © 2011 Accenture All rights reserved. 25Source: Tesla Memorial Society; Nicholas Carr, “The Big Switch”.
  • Cloud computing – a 1969 conceptDouglas Parkhill (DFAIT) and John McCarthy (Stanford) ”In addition to making raw computer power available in a convenient economical form, a computer utility would be concerned with almost any service or function which could in some way be related to the processing, storage, collection and distribution of information.” The Challenge of the Computer Utility, 1966Copyright © 2011 Accenture All rights reserved. 26Source: “The Challenge of the Computer Utility”, 1966
  • $B investments into data centersMassive, “off-deck” geo-distributed computing power Prineville, OR USA Lockport , NY USA The Dalles, OR USA Maiden, NC USA Morrow, OR USA Dublin, IrelandCopyright © 2011 Accenture All rights reserved. 27
  • Contrasting cloud economicsWhat $1 can buy Price for 20GB Storage Cloud Music Storage $5 per annum Up to 20,000 Tracks Free $20 per annum Up to 10,000 Tracks Free $40 per annum Up to 25,000 with $25 PlanCopyright © 2011 Accenture All rights reserved. 28Source: Google, Apple, Amazon, Accenture analysis.
  • Largest Commercial Cloud PlatformGoogle with (planned) 107 machines, all subject to Moore’s LawCopyright © 2011 Accenture All rights reserved. 29Source: Jeff Dean, Google.
  • What’s next?Copyright © 2011 Accenture All rights reserved. 30
  • Apple’s device businessApple Product Group Revenue ($B) 50 45 iPhone 40 35 30 25 iPad 20 Mac 15 10 iPod 5 0 Apple TV 2004 2005 2006 2007 2008 2009 2010 2011ECopyright © 2011 Accenture All rights reserved. 31Source: Apple, Accenture analysis..
  • The Apple Store – direct to consumer26,500 FTEs, 250M+ annual visitors in ~350 stores in 11 countries. New York Paris Tokyo Sydney Munich ShanghaiCopyright © 2011 Accenture All rights reserved. 32Source: Apple, Accenture analysis..
  • Apple Store performance compared $13B in sales, with more $/SqFt/Year than Tiffany & Co. Scale of Retail Operations Retail Revenue MetricsQ3 FY2010 – Retail Retail Retail FTEs / $ / SqFt / Year $ / employee / $ / Day / Store $ / Store / YearQ2 FY2011 Revenue Stores Space part-time ($) Year ($K) ($K) ($M) ($B) (#) (M SqFt) employees (K) 13 323 2.5 30 $4,793 $397 $102 $37 $3,010 $337 $36 $13 3.1 233 1 9 $866 $279 $33 $12 50.3 4,172 58 180 $425 $200 $128 $47 419 8,970 985 2,100 $391 $179 $125 $46 9.3 204 23.8 52 Copyright © 2011 Accenture All rights reserved. 33 Source: Apple, Tiffany, BestBuy, Walmart, Nordstrom Accenture analysis..
  • Explosive growth for mobility 1B smartphone shipments by 2015 Global Mobile Shipments 2005-2015E, Millions ‘10 –’15 2,500 CAGR Total 2,076 8.4% 1,971 Devices 2,000 1,854 1,718 1,557 Smart 820 926 1,500 1,389 707 Phones 25.0%Millions 582 1,188 1,190 453 1,128 303 1,002 124 151 1,000 173 833 82 57 1,064 1,085 1,105 1,135 1,147 1,151 1,150 Non 500 1,039 954 1.2% 920 SPs 777 0 2005 2006 2007 2008 2009 2010 2011 E 2012 E 2013 E 2014 E 2015 E SP Share 7% 8% 10% 13% 15% 22% 29% 34% 38% 42% 45% of Total Copyright © 2011 Accenture All rights reserved. 34 Source: IDC.
  • Ephemeralization“Progressively doing more with less” Buckminster Fuller, 1938 “To do more and more with less and less until eventually you can do everything with nothing”Copyright © 2011 Accenture All rights reserved. 35
  • Early “ephemeralization” aka “appification”Devices are being replaced by apps.2006 2011 and BeyondTV VideoPhone VoiceMP3 Player MusicCamera “Camera”Credit Card PaymentsCopyright © 2011 Accenture All rights reserved. 36
  • Software replacing people and things.Start to wonder who / what is next People Things Taxi Dispatcher ATMs KeysCopyright © 2011 Accenture All rights reserved. 37
  • Cloud-to-device frameworksConnecting “on-deck” with “off-deck” computing power: mobile cloud Cloud Device Today-ish HTTP (custom libraries) Tomorrow SDKsCopyright © 2011 Accenture All rights reserved. 38
  • Industrialization of the back-endCloud-to-device tools and frameworks.Copyright © 2011 Accenture All rights reserved. 39
  • Jevons’ ParadoxIncreased efficiency can lead to increased consumption William S. Jevons 1865 ”It is a confusion of ideas to suppose that the economical use of fuel is equivalent to diminished consumption. The very contrary is the truth."Copyright © 2011 Accenture All rights reserved. 40
  • As computing gets cheaper…Four Decades of Data from the US Bureau of Economic Analysis (1/3)US Asset Price Index, 1969 – 2010Normalized, 2005 = 100105 Computers and104 Peripheral Equipment103 Transportation Equipment102 Other Equipment Industrial Equipment101 1970 1980 1990 2000 2010Copyright © 2011 Accenture All rights reserved. 41Source: BEA, Accenture analysis.
  • … companies consume more of itFour Decades of Data from the US Bureau of Economic Analysis (2/3)US IT Investment, 1969 – 2010Annual Investment per Employee ($) & Nominal Annual Investment ($B)Annual Investment per Nominal AnnualEmployee ($) Investment ($B)$3,500 $350$3,000 $300$2,500 $250$2,000 $200$1,500 $150$1,000 $100 $500 $50 $0 $0 1970 1980 1990 2000 2010Copyright © 2011 Accenture All rights reserved. 42Source: BEA, Accenture analysis.
  • Software-driven consumption of ITFour Decades of Data from the US Bureau of Economic Analysis (3/3)US IT Investment, 1969 – 2010SW : HW Ratio 2009 SW:HW invest3.5 ratio passes 3:1 3 19902.5 Tim Berners-Lee WorldWideWeb 1995 2007 YHOO, AMZN, NSCP: 1st iPhone 2 Commercial Web 19901.5 ARPANET decommissioned 1 Academic Private Investment Investment0.5 1970 1980 1990 2000 2010Copyright © 2011 Accenture All rights reserved. 43Source: BEA, Accenture analysis.
  • Think again “People tend to overestimate what can be done in one year and to underestimate what can be done in five to ten years.” J. C. R. Licklider, 1965Copyright © 2011 Accenture All rights reserved. 44