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Deloitte TMT Predictions 2015

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Deloitte’s Technology, Media & Telecommunications (TMT) Predictions offer insights that will help you and your business succeed in the year ahead.

The annual report is based on global research – including in-depth interviews with clients, industry analysts, global industry leaders and more than 8,000 Deloitte member-firm TMT practitioners.

Published in: Business

Deloitte TMT Predictions 2015

  1. 1. #DeloittePredicts tmtpredictions.ca
  2. 2. Phoning it in: Mobile payments (finally) start to go mainstream 2015: #DeloittePredicts This year will see a 1,000% increase in the number of global smartphones used at least once a month to make an in-store contactless payment. TMT1PREDICTION
  3. 3. Make it a snap to pay with an app… For the first time, stakeholders from banks and merchants to credit card companies and device vendors are ready to adopt the short-range, near-field communication wireless technology that enables mobile payments. TMT1PREDICTION
  4. 4. …but it will take time to put tapping on top Overcoming technical and security issues will pale in comparison to getting consumers who’ve spent decades choosing between cash or charge to cross the digital divide. Only one in 20 smartphone owners will be tapping by year’s end. TMT1PREDICTION
  5. 5. Show TMT the money 2015: #DeloittePredicts Notwithstanding their reputation as digital pirates unwilling to pay for content, millennials in North America will spend an average of $750 annually on media content. That’s up to 15% of their income and, on a percentage basis, more than older generations will be spending. TMT2PREDICTION
  6. 6. Traditional content down, but not out… 18- to 34-year-olds are spending less on content than in the past, but with over 80 million of them in North America, they will spend a cumulative $60 billion in 2015 on books, movies, concerts and festivals, games, streaming video like Netflix, and even traditional TV services. TMT2PREDICTION
  7. 7. TMT2PREDICTION …though new challenges abound Some part of millennials’ share-of-wallet has shifted to tech and telecom: they are likely to pay an average of $3,000 per year for hardware devices and telecom services that make those devices useful. Content is the likely target for cost-cutting, though it’s a generation that shows it will pay for content it really wants.
  8. 8. Page not turned on turning actual pages 2015: #DeloittePredicts Print books will account for more than 80% of books sold in the developed world, despite tablets, e-readers and smartphones being everywhere. TMT3PREDICTION
  9. 9. Print’s charming… Unlike other digital formats, like music and movies, 18- to 34-year-olds are just as attached to print books as older generations. They like how books smell, and they like the fact that other people can see what they’re reading. You can judge a book by its cover… TMT3PREDICTION
  10. 10. … but profits are distributed differently Despite the preference for print, the number of brick-and-mortar bookstores is down 50% over the past decade, with publishers, authors, e-tailers and retailers still sorting out how to divide profits. There may be a difference in how the brain remembers what was read on a digital screen or paper page, and more research needs to be done. TMT3PREDICTION
  11. 11. Euro-provision 2015: #DeloittePredicts “Click-and-collect” locations – drop boxes or special sections of a store that hold online orders until customer pickup – will for the first time surpass 500,000 locations in Europe’s five largest markets (Germany, France, Italy, Spain and the United Kingdom). Click-and-collect locations are already in use at some Canadian grocery stores and shopping centres. Will they become as common here as in Europe? TMT4PREDICTION
  12. 12. TMT4PREDICTION A necessary retrieval… Click-and-ship as the only option for an online order is so 2014. Increasingly, e-commerce from both online pure plays and brick-and-mortar retailers are providing options for consumers to receive orders at home, in-store or elsewhere, reviving a concept pioneered in Canada that was a casualty of the original dot.com crash.
  13. 13. …with critical supports in place Even if click-and-collect options become table stakes, all retailers must monitor how these pickup boxes impact margins and be prepared to rapidly adapt or abandon initiatives. TMT4PREDICTION
  14. 14. Short video’s (very) high bar 2015: #DeloittePredicts Short-form online video clips of less than 20 minutes’ length will represent less than 3% of all video watched this year. TMT5PREDICTION
  15. 15. TMT5PREDICTION Growth does not equal height… Billions of users and double-digit, year-over-year increases does not a giant make. Global audiences will cumulatively watch more than 12 billion hours of long-form video (aka TV!) daily, more than the 10 billion hours of short-form clips that will be consumed over an entire month.
  16. 16. …so look who’s watching, and paying Short content tends to be music, how-to videos, clips of traditional television and toys being unboxed – with revenues of about $5 billion. This compares to long-form video drawing 82 times more advertising and subscription revenue ($410 billion) in 2015 and at least 1,000% more revenue over the next decade. TMT5PREDICTION
  17. 17. Game of Phones 2015: #DeloittePredicts The refresh cycle for smartphones is getting longer, and shorter, all at once. Of the 1.4 billion smartphones that will be sold in 2015, more than a billion will be upgrades. TMT6PREDICTION
  18. 18. Hold ’em for some… Smartphone sales will still grow 12% in 2015, but that’s down from 47% just three years ago. More durable hardware, split budgets for multi-device owners and less tech-obsessed late adopters to the smartphone market will extend the time between renewals for many. TMT6PREDICTION
  19. 19. TMT6PREDICTION … fold ’em for others But true refreshes for reasons of want, rather than need, are growing, too. Some liken a smartphone’s “cool factor” to what cars meant to previous generations. A status symbol that costs less than $1,000 and is an essential tool used hundreds of times a day is the perfect item to prompt “I want that” buyers. That’s not even counting replacing dropped phones…
  20. 20. Work before leisure 2015: #DeloittePredicts A decade’s worth of consumerization and Bring Your Own Device will reverse as enterprises once again become the driving force behind the adoption of new technologies. TMT7PREDICTION
  21. 21. Ready to wearable… In 2014 we told you wearables would be a consumer-first product. Whoops. This year’s news is that enterprise is ready to go big on cyber-fying workforces into a state of augmented reality, led by the security, medical and warehousing industries. But enterprise-first doesn’t stop there: look for companies to be the leading edge in 2015 for 3D printing, the Internet of Things and drones, too. TMT7PREDICTION
  22. 22. …just don’t believe all the hype Nearly every new technology prompts great stories about science fiction fantasies finally being realized. But remember that unless a technology solves a mass market need and provides manufacturers with ROI numbers similar to the cellphone or tablet, consumer pickup will piggyback enterprise adoption and not the other way around. TMT7PREDICTION
  23. 23. Put IT on the company card 2015: #DeloittePredicts Enterprises will buy 60% of all wireless Internet of Things devices…and over 90% of the services dollars tied to those devices will be enterprise, too. TMT8PREDICTION
  24. 24. Ask not what tech can do for you… Early adopters may yearn to connect a smartphone to their laundry machine, thermostat, garage door and hydro meter. But most people don’t. Apps don’t sort or fold, time-shifting drying your laundry saves less than $50 a year and one utility’s smart-meter dashboard got only 6% of customers to look at it in three years. Worse, only 2% did so more than once. TMT8PREDICTION
  25. 25. …but what tech can do for your company For governments and big business, connected devices are, well, big business. While smart meters, smart grids, smart homes, smart cities and smart highways offer only small benefits to individual consumers, the savings to enterprises can be 5-10 times greater. More valuable still may be the data collected by all those connected machines. TMT8PREDICTION
  26. 26. 3D printers mean business 2015: #DeloittePredicts By year’s end, one in four businesses in developed countries will have, or be planning to acquire, a 3D printer. That’s a 50% increase over 2013, when that ratio was one in six. TMT9PREDICTION
  27. 27. TMT9PREDICTION Beyond parts largely unknown… Consumers will purchase more than half of all 3D printers sold by units, but enterprise purchases will account for 80% of the dollar value of the global market and 99% of the value of 3D-printed objects will accrue to businesses. About 90% of this will be either rapid prototyping or interim parts that fit into an existing manufacturing process such as a mold, die or cast, though finished products will be the fastest-growing segment of 3D-printed items.
  28. 28. …yet the adventure continues The huge expense and technical difficulty of operating high-end 3D printers, as well as the (very) limited consumer need for plastic-only printed objects, means that even by 2020, 3D printers will only be occasional-use items in 10-20% of homes. However, learning how to use these printers and their associated software may soon make them standard equipment in schools. TMT9PREDICTION
  29. 29. All broadband is equal but some is more equal than others 2015: #DeloittePredicts Significant variations in home broadband speeds will persist, with the top 10% of average download speeds in some global markets being five times faster than the average for the bottom 10%. TMT10PREDICTION
  30. 30. Practical considerations... Several different broadband technologies exist, but two general rules are that the most cost-effective upgrades work best in densely packed urban environments and higher speeds cost end users more money. TMT10PREDICTION
  31. 31. …versus the need for speed Businesses looking to deliver over-the-top services – especially bandwidth-intensive ones like video-on-demand – should consider the range of broadband speeds available to consumers in their target markets. A speed of five Mbps is considered pretty good, but for homes with multiple users or watching HD/Ultra HD, not all broadband is the same. TMT10PREDICTION
  32. 32. Deloitte, one of Canada's leading professional services firms, provides audit, tax, consulting, and financial advisory services. Deloitte LLP, an Ontario limited liability partnership, is the Canadian member firm of Deloitte Touche Tohmatsu Limited. Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms. © Deloitte LLP and affiliated entities.

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