Biz Model for Wireless Electricity

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My students use ideas from my class to develop a business model for wireless electricity from WiTricity. The slides describe the value proposition for various types of customers/applications including medical, industrial, and consumer products. The slides also discuss the methods of value capture and strategic control.

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Biz Model for Wireless Electricity

  1. 1. Imagine a world without wires Group presentation: Wireless Electricity Technology Management Strategy National University of Singapore Gaurav Chandrashekar Coline Juin Jan Zwerina Hitesh Suresh Marieke Oosterbaan12/7/2012 MT4002 – Group presentation 1
  2. 2. Imagine a world without wires12/7/2012 MT4002 – Group presentation 2
  3. 3. Agenda ◤ Introduction to Witricity ◤ Value Proposition: Wireless vs Wired ◤ Potential Markets ◤ Value Proposition ◤ Strategic Comparison ◤ Target Market: Consumer Products ◤ Challenges and Competitors ◤ Business Model Generation ◤ Value Capture & Strategic Control ◤ Conclusion07.12.2012 MT4002 – Group presentation 3
  4. 4. Introduction to Witricity ◤ Wireless electricity transmission technology ◤ Uses resonance coupling of coils ◤ Multiple devices can tap power from single coil ◤ Wireless electricity transmission with low losses (40% efficiency at 2.3m transmission) ◤ Not dependent on direction (Up to 15° off axis at this moment)12/7/2012 MT4002 – Group presentation 4
  5. 5. Wired vs. Wireless Wired Power Wireless Power Pros • Low Transmission • Eliminates cables, Losses infrastructure etc. • Familiar in use • Eliminates power plug • It is everywhere compatibility issues • Mobility within transmission range • Automatic power receiver Cons • Limited Mobility • High transmission losses • Requirement for cables, • Requirement for new infrastructure etc wireless infrastructure07.12.2012 MT4002 – Group presentation 5
  6. 6. Agenda ◤ Introduction to Witricity ◤ Value Proposition: Wireless vs Wired ◤ Potential Markets ◤ Value Proposition ◤ Strategic Comparison ◤ Target Market: Consumer Products ◤ Challenges and Competitors ◤ Business Model Generation ◤ Value Capture & Strategic Control ◤ Conclusion07.12.2012 MT4002 – Group presentation 6
  7. 7. Potential Markets ◤ Medical ◤ Consumer Products ◤ Industrial Equipment ◤ Lets see what value proposition of products in these markets can be07.12.2012 MT4002 – Group presentation 7
  8. 8. VP for Products in Medical Market ◤ Improved dexterity and safety during surgery ◤ Improves surgical tools through elimination of wires ◤ Reduces need for multiple surgeries ◤ No need for surgery to replace batteries for internal devices (eg. Pacemakers) ◤ Opportunity for less invasive surgery procedures ◤ Reduced size of products ◤ Enables greater use of “camera-pills” and sensors to track bodily functions ◤ Eliminates battery-constraint by in-body sensors07.12.2012 MT4002 – Group presentation 8
  9. 9. VP for Products in Industrial Equipment Market ◤ Improved safety ◤ No loose wires on production floor ◤ More effective use of floor space ◤ Greater flexibility in machine location ◤ Architectural new possibilities for product designs ◤ Tools that can rotate through all axes ◤ Higher productivity ◤ Longer running time compared to using rechargeable wireless device12/7/2012 MT4002 – Group presentation 9
  10. 10. VP for Products in Consumer Market ◤ Increased Convenience for the user ◤ Greater Mobility ◤ Improved Ubiquity ◤ Eliminates standard wars of power sockets an chargers ◤ Reduction in product size ◤ Smaller batteries ◤ Improved Usability ◤ Eliminating „activity of charging‟07.12.2012 MT4002 – Group presentation 10
  11. 11. Agenda ◤ Introduction to Witricity ◤ Value Proposition: Wireless vs Wired ◤ Potential Markets ◤ Value Proposition ◤ Strategic Comparison ◤ Target Market: Consumer Products ◤ Challenges and Competitors ◤ Business Model Generation ◤ Value Capture & Strategic Control ◤ Conclusion07.12.2012 MT4002 – Group presentation 11
  12. 12. Strategic comparison of Markets Medical Consumer Industrial Size of market Large Very Large Medium Character- No. Of vertical segments Few Many Few istics Growth Moderate Fast Moderate Need Usefulness useful moderate moderate Vertically Vertically Vertically Management Control integrated disintegrated integrated? Product Life Cycle (PLC) Long Short Long Barriers to entry Very slow Time to market Quick Slow Ease of Access to Hard Easy Medium Distribution Channels12/7/2012 MT4002 – Group presentation 12
  13. 13. Agenda ◤ Introduction to Witricity ◤ Value Proposition: Wireless vs Wired ◤ Potential Markets ◤ Value Proposition ◤ Strategic Comparison ◤ Target Market: Consumer Products ◤ Challenges and Competitors ◤ Business Model Generation ◤ Value Capture & Strategic Control ◤ Conclusion07.12.2012 MT4002 – Group presentation 13
  14. 14. Consumer Products: Competitors & Challenges ◤ Competitors ◤ Technical challenges ◤ Market challenges12/7/2012 MT4002 – Group Presentation 14
  15. 15. Consumer Wireless Electricity: 3 LeadingAlternatives Inductive Resonance Radio Frequency Name Coupling Coupling Harvesting (qi Standard) (Witricity) Currently available Currently still in Late stage R&D / Where it stands in market R&D Pre market launch (Potential) Near to Medium Near field charging Far field charging Applications field charging Fulton Innovation / Energizer / Companies Intel Witricity Samsung / Nokia / Duracell12/7/2012 MT4002 – Group presentation 15
  16. 16. Consumer Wirless Electricity: 3 Leading Alternatives Inductive Resonance Radio Frequency Name Coupling Coupling Harvesting (qi Standard) (Witricity) Efficiency 75% - 98% N/A 98% 1-2 cm Efficiency N/A N/A 40% at 2.29m >1m Up to 15 degrees Charging Alignment Required N/A off axis12/7/2012 MT4002 – Group Presentation 16
  17. 17. Main Competitor: ‘qi’ Standard ◤ Current market leader is qi (Wireless Power Consortium) ◤ Partners include: Nokia, Samsung, Texas instrument ◤ qi is an open standard ◤ However limited technology: ◤ Maximum transmission distance only 40mm07/12/2012 MT4002 – Group Presentation 17
  18. 18. Validated Market12/7/2012 MT4002 – Group Presentation 18
  19. 19. Agenda ◤ Introduction to Witricity ◤ Value Proposition: Wireless vs Wired ◤ Potential Markets ◤ Value Proposition ◤ Strategic Comparison ◤ Target Market: Consumer Products ◤ Challenges and Competitors ◤ Business Model Generation ◤ Value Capture & Strategic Control ◤ Conclusion07.12.2012 MT4002 – Group presentation 19
  20. 20. Business Model Generation ◤ Witricity‟s Current Business Model ◤ Business Model Illustration ◤ Issues With Current Model ◤ Propose New Business Model ◤ Crossing The Chasm ◤ Where To Introduce Witricity And Why ◤ Why Is It Interesting For Our Partners12/7/2012 MT4002 – Group Presentation 20
  21. 21. Current Business Model = Licensing12/7/2012 MT4002 – Group presentation 21
  22. 22. Issues with current business model ◤ Commercialization impetus with licensees ◤ Market has high network effects ◤ High risk for licensees to produce at scale ◤ No catalyst / champion to encourage adoption Witricity has limited strategic control There is no catalyst to cross chasm: we will propose one12/7/2012 MT4002 – Group presentation 22
  23. 23. Proposed Business Model07.12.2012 MT4002 – Group presentation 23
  24. 24. Where to introduce Witricity? Location with greatest impact? Outside Homes ◤ No or inconvenient existing charging infrastructure Locations where consumers spend "time“12/7/2012 MT4002 – Group presentation 24
  25. 25. How will we cross the chasm? Electricity providers Public locations12/7/2012 MT4002 – Group presentation 25
  26. 26. Value Capture for Public Locations ◤ Improvement of value proposition ◤ Differentiation among competitors ◤ Leads to improved sales ◤ Value capture through: ◤ Purchase of goods and services from establishment ◤ Sale of receiver coil plugs ◤ Service fee: subscription or advertisements12/7/2012 MT4002 – Group presentation 26
  27. 27. Proposed Business Model07.12.2012 MT4002 – Group presentation 27
  28. 28. How will we cross the chasm? Electricity customers12/7/2012 MT4002 – Group presentation 28
  29. 29. Consumer Products: Which Target Device? ◤ Large volume ◤ Low barriers to entry ◤ Vertically disintegrated ◤ Highly mobile usage07.12.2012 MT4002 – Group presentation 29
  30. 30. Consumer Products Market Overview 2012
  31. 31. Consumer Products: Which Target Device? ◤ Large volume ◤ Low barriers to entry ◤ Existence of 3rd party add-ons ◤ Vertically disintegrated ◤ Highly mobile usage07.12.2012 MT4002 – Group presentation 31
  32. 32. How will we cross the chasm? Electricity customers12/7/2012 MT4002 – Group presentation 32
  33. 33. Crossing the Chasm ◤ Create Infrastructure ◤ Partnerships with commercial locations ◤ Reduce Network Effects ◤ Provide easy adoption through sale of adaptors at commercial locations ◤ Increase Technology Accessibility ◤ Distribute demonstration kits for early adopters / hackers12/7/2012 MT4002 – Group presentation 33
  34. 34. Proposed Business Model12/7/2012 MT4002 – Group Presentation 34
  35. 35. Conclusion: 3 step strategy for crossing the Chasm Step A: Early Adopters phase ◤ Manufacture and distribute receivers & transmitters ◤ Partner with public locations eg. Starbucks Step B: Early Majority Phase ◤ Encourage integration of receivers with phone manufacturers Step C: After Crossing The Chasm ◤ Return to pure licensing model ◤ Focus on R&D07.12.2012 MT4002 – Group presentation 35
  36. 36. Agenda ◤ Introduction to Witricity ◤ Value Proposition: Wireless vs Wired ◤ Potential Markets ◤ Value Proposition ◤ Strategic Comparison ◤ Target Market: Consumer Products ◤ Challenges and Competitors ◤ Business Model Generation ◤ Value Capture & Strategic Control ◤ Conclusion07.12.2012 MT4002 – Group presentation 36
  37. 37. Questions?Thank you for your attention!
  38. 38. Cost Benefit AnalysisHow much does it cost to charge an iPhone 5? ◤ iPhone 5 holds 9.5 watt-hours of charge 0.0095 kWh/day x 70% efficiency x 365 days = 3.47 kWh per year. x 27 cents/kwH (Cost of electricity in SG) = $0.95/year or $0.0026/charge07/12/2012 MT4002 – Group Presentation 38
  39. 39. Technological Challenges of Witricity ◤ Lack of transmission distance ◤ 40% efficiency at 2.3m ◤ Directionally dependant ◤ up to 15° ◤ Safety ◤ Increased magnetic fields07/12/2012 MT4002 – Group Presentation 39
  40. 40. Strategic Partners of Witricity (so far) Mobile Industrial Hybrid Cars Health Care Devices Equipment Toyota Misubishi Audi MediaTek Thoratec GE Delphi Batteries12/7/2012 MT4002 – Group presentation 40

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