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CHINA TELEMATICS SITUATION & THINKING
Manfred	
  Fu(GM	
  of	
  Telenav	
  Shanghai)	
  
May	
  2015	
  
2
Video:	
  1st	
  China_short	
  
3
Baidu
Tencent
Alibaba
Xiaomi
Huawei
BAIDU—SEARCH ENGINE GIANT
4
•  Market	
  Cap:	
  $69.33	
  B	
  
•  F2015Q1	
  revenue:	
  $2.053	
  B	
  
•  In	
  2014,	...
CARLIFE– BAIDU SOLUTION IN CAR
5
Baidu	
  map(app)	
  
•  APP	
  is	
  free	
  to	
  use	
  
•  Map/navigaRon	
  APIs	
  a...
TENCENT—SOCIAL NETWORK GIANT
6
•  Market	
  Cap:	
  $206.2	
  B(2015/4/13)	
  
•  F2015Q1	
  revenue:	
  $3.618	
  B	
  
•...
7
2014-­‐04-­‐21,	
  21:11:00	
  
TENCENT OBD SOLUTION—LUBAO(2013)
•  BT connection to phone
•  Car diagnostic
•  Interact with Tencent mobile
navigation
8
WEDRIVE—TENCENT ALL-IN ONE SOLUTION IN CAR
9
Feature	
  scope:	
  
•  NavigaRon	
  
•  Social	
  life	
  
•  News	
  
•  M...
ALIBABA—E-COMMERCE GIANT
10
•  Market	
  Cap:	
  $213.6	
  B(2015/5/7)	
  
•  March	
  quarter	
  2015	
  revenue:	
  $2.8...
11
Invest	
  1	
  billion	
  yuan	
  ($160	
  million)	
  	
  
to	
  develop	
  Internet-­‐connected	
  vehicles	
  
BUILDING THE FOREST AROUND CAR & DRIVER
12
Used	
  car	
  replacement	
  
AucRon	
  
Premium	
  used	
  car	
  
Smart	
  d...
COMPARISON TO GLOBAL GIANTS
13
latest	
  quarter	
  
(by	
  May	
  2015)	
  
Baidu	
   Google	
   Tencent	
   Facebook	
  ...
SUMMARY– BAT WITH LBS
All of them:
–  Own or invest map vendors
–  Own navigation engine
–  Cooperate with HW partners
–  ...
In	
  2014,	
  Xiaomi	
  invested	
  $14	
  million	
  to	
  own	
  Careland,	
  
later	
  is	
  map	
  content	
  vendor	...
HUAWEI
—LEADING GLOBAL INFORMATION & COMMUNICATIONS
TECHNOLOGY (ICT) SOLUTIONS PROVIDER.
AND A TOP SMART DEVICE
16
In	
  2...
17
Revenue	
  from	
  oversea	
  is	
  higher	
  than	
  it	
  from	
  China	
  
37.8%(from	
  China)	
  vs	
  62.2%(from	...
WHY THESE GIANTS SUCCESSFUL IN CHINA-1
Same/unified origin:
–  One large nationality, total 1.226 billion Chinese are
the ...
WHY THESE GIANTS SUCCESSFUL IN CHINA-2
User habits:
–  User experience: Simple
–  Willing to accept new things
–  Like fre...
WHY THESE GIANTS SUCCESSFUL IN CHINA-3
•  Originally, foreign players inspired them
20
WHY THESE GIANTS SUCCESSFUL IN CHINA-4
But soon, they did better:
•  In 1998, ICQ is the No.1 IM(instant message) SW in Ch...
WHY THESE GIANTS SUCCESSFUL IN CHINA-5
•  More open platform
•  Free to end user, making profit from Ads and 3rd party
•  ...
23
Create	
  saYsfacYon	
  
Create	
  loyalty	
  
Create	
  evangelism	
  
THEY ARE CHANGING TO KEEP LEADING POSITION,
FRO...
24
PASSENGER CAR SALES—CN(2011-2019)
14.47	
  
15.50	
  
17.99	
  
19.71	
  
21.09	
  
22.57	
  
24.37	
  
26.32	
  
28.43...
40+ LOCAL PASSENGER CAR BRANDS
CHINA BEFORE MARKET NAV RATE(2011-2019)
26
7.08%	
   7.52%	
  
9.28%	
  
12.70%	
  
14.12%	
  
16.54%	
  
18.96%	
  
21.38...
EUROPEAN OEM’S NAVIGATION IN CHINA
•  Connected HU(call center, cloud search,
infotainment, etc)
•  Knob + some hot button...
JAPANESE OEM’S NAVIGATION IN CHINA
•  Performance is amazing
•  Traditional step by step HMI design
•  Rich functions with...
US OEM’S NAVIGATION IN CHINA
•  Relatively simple HMI design style
•  Connected solution focus on safety and Remote
contro...
CHINA AFTER MARKET NAV RATE(2009-2014)
30
169.5	
  
342.7	
  
510.4	
  
662.4	
  
704.2	
  
75.30%	
  
102.20%	
  
48.90%	...
SMARTPHONE PROJECTION
DRIVING COMMODITIZATION
§  No differentiation between vehicle segments
§  Same experience in every...
CONNECTED NAVIGATION
LEVERAGE THE ENTIRE CANVAS & CAR DATA
The car can surpass smartphone UX
§  Instantly on
§  Immediat...
UNLOCKING THE DATA POTENTIAL
TO DELIVER A SUPERIOR EXPERIENCE
PERSONAL DATA
VEHICLE DATA
ENVIRONMENT DATA
33
OUR INTEGRATED SOLUTION
SMART CLOUD
MOBILE SDK LIVING MAP &
BEST-IN-CLASS
CONTENT
AUTO HMI & SDK
34
WHAT WE LEARN FROM THEM
35
Chemical	
  ReacYon	
   Physical	
  ReacYon	
  
Internet	
  +	
   +	
  Internet	
  
36
Win-­‐Win:	
  In	
  Car,	
  Forget	
  the	
  Phone	
  
THANK	
  YOU	
  
Manfred	
  Fu	
  
傅杰伟
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Manfred Fu (Telenav) – Overview of Trends in the China Market

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Manfred Fu (Telenav) – Overview of Trends in the China Market

  1. 1. CHINA TELEMATICS SITUATION & THINKING Manfred  Fu(GM  of  Telenav  Shanghai)   May  2015  
  2. 2. 2 Video:  1st  China_short  
  3. 3. 3 Baidu Tencent Alibaba Xiaomi Huawei
  4. 4. BAIDU—SEARCH ENGINE GIANT 4 •  Market  Cap:  $69.33  B   •  F2015Q1  revenue:  $2.053  B   •  In  2014,  Baidu’s  mobile   revenue  surpassed  PC  in   December     •  In 2013, Baidu owned a map data vendor—长地万方Ritu
  5. 5. CARLIFE– BAIDU SOLUTION IN CAR 5 Baidu  map(app)   •  APP  is  free  to  use   •  Map/navigaRon  APIs  are  open/free  to   developers   •  Market  share:  65.2%   •  User:  370m(2014/9/3)   •  Day  request:  >10B   CompaRbility   •  Phone:  iPhone,  Android   •  Car:  Linux,  QNX,  Android,  WinCE   •  ConnecRon(phone  &  car):  USB  or  WIFI   OEM  level  HMI  &  UE   •  Sensors  with  car   •  Voice  control   •  CooperaRng  with  OEMs  &  Tier1s  
  6. 6. TENCENT—SOCIAL NETWORK GIANT 6 •  Market  Cap:  $206.2  B(2015/4/13)   •  F2015Q1  revenue:  $3.618  B   •  Top  2  popular  app:  QQ,    WeChat(from  mobile  &  PC)   •  Most  revenue  from  game(TBD)   •  User  of  WeChat:  >500m(by  2014)     •  In 2014, Tencent spent $187 million in Navinfo to became later’s 2nd large stakeholder. •  Navinfo is one of top two map data vendor in China
  7. 7. 7 2014-­‐04-­‐21,  21:11:00  
  8. 8. TENCENT OBD SOLUTION—LUBAO(2013) •  BT connection to phone •  Car diagnostic •  Interact with Tencent mobile navigation 8
  9. 9. WEDRIVE—TENCENT ALL-IN ONE SOLUTION IN CAR 9 Feature  scope:   •  NavigaRon   •  Social  life   •  News   •  Music   •  Stock   •  Online  video   •  Call  center  service   •  Restaurant  recommend  Summary   •  Strong  in  “infotainment”   •  Not  enough  integraRon  with  HW   •  No  deep  cooperaRon  with  car  makers    
  10. 10. ALIBABA—E-COMMERCE GIANT 10 •  Market  Cap:  $213.6  B(2015/5/7)   •  March  quarter  2015  revenue:  $2.81  B   •  GMV  (Gross  Merchandise  Volume)  in  F2015Q4:  $97  B   •  In 2014, Alibaba fully acquired AutoNavi, total of USD 1.38 billion, later is one of top two map data vendor in China
  11. 11. 11 Invest  1  billion  yuan  ($160  million)     to  develop  Internet-­‐connected  vehicles  
  12. 12. BUILDING THE FOREST AROUND CAR & DRIVER 12 Used  car  replacement   AucRon   Premium  used  car   Smart  device  &  OBD   Lease   Designated  driver   Car  SPA   New  car  booking   Car  finance   Car  E-­‐shopping   Car  insurance   Car  fikng   4S  maintain   O2O  service   Fuel,  violaRon,  etc   CerRfied  accessories   Shopping   service   Local   service   Used  car   New  car  
  13. 13. COMPARISON TO GLOBAL GIANTS 13 latest  quarter   (by  May  2015)   Baidu   Google   Tencent   Facebook   Alibaba   Amazon   Market  Cap   ($  billion)   69.33   363.07   206.2   222.22   213.6   199.78   Revenue   ($  billion)   2.053   17.26   3.618   3.54   2.81   22.72  
  14. 14. SUMMARY– BAT WITH LBS All of them: –  Own or invest map vendors –  Own navigation engine –  Cooperate with HW partners –  Cooperate with Auto makers to host HU screen –  Trying to understand all details around driver & car 14
  15. 15. In  2014,  Xiaomi  invested  $14  million  to  own  Careland,   later  is  map  content  vendor  and  No.1  navigaRon  SW   market  share  in  beforemarket  car  navigaRon   XIAOMI —WORLD'S THIRD LARGEST SMARTPHONE VENDOR 15
  16. 16. HUAWEI —LEADING GLOBAL INFORMATION & COMMUNICATIONS TECHNOLOGY (ICT) SOLUTIONS PROVIDER. AND A TOP SMART DEVICE 16 In  2014,  overall  Group  revenue  reached  $46.5  billion,  up   32.7%  year  on  year  
  17. 17. 17 Revenue  from  oversea  is  higher  than  it  from  China   37.8%(from  China)  vs  62.2%(from  oversea)  
  18. 18. WHY THESE GIANTS SUCCESSFUL IN CHINA-1 Same/unified origin: –  One large nationality, total 1.226 billion Chinese are the Han nationality –  One language, Mandarin is popular and accepted by most Chinese –  One currency, Renminbi(RMB) –  Unified policy 18 Demographic  Dividend  
  19. 19. WHY THESE GIANTS SUCCESSFUL IN CHINA-2 User habits: –  User experience: Simple –  Willing to accept new things –  Like free software, few people paid –  Half of Chinese living in city –  With University (college) education level: 8.73% –  China's GDP per capita(by 2014): $ 7,485 19
  20. 20. WHY THESE GIANTS SUCCESSFUL IN CHINA-3 •  Originally, foreign players inspired them 20
  21. 21. WHY THESE GIANTS SUCCESSFUL IN CHINA-4 But soon, they did better: •  In 1998, ICQ is the No.1 IM(instant message) SW in China. In 1999, QQ(Tencent’s IM) was established and only two employees(two founders), one year later(year 2000), QQ became the No.1 IM SW in China, easier to use and free, better UE than MSN •  When Taobao(Alibaba’s) launched his first E-commerce platform in 2003, Ebay is the E-commerce giant in China. But in 2006, Ebay closed his server in Mainland, was quickly beat by Taobao in China. Taobao’s platform is more open and free. •  Similar story for Baidu, in 2000 Baidu set up and at that time Google is search engine giant in China. But in 2003, Baidu’s market share in China surpassed Google. 21
  22. 22. WHY THESE GIANTS SUCCESSFUL IN CHINA-5 •  More open platform •  Free to end user, making profit from Ads and 3rd party •  Quickly update •  More respect for Chinese users, more attention on detail improvements 22 Xiaomi's key to smartphone success: 'Be friends with our fans'
  23. 23. 23 Create  saYsfacYon   Create  loyalty   Create  evangelism   THEY ARE CHANGING TO KEEP LEADING POSITION, FROM MEET MOST PEOPLE TO MEET YOU
  24. 24. 24 PASSENGER CAR SALES—CN(2011-2019) 14.47   15.50   17.99   19.71   21.09   22.57   24.37   26.32   28.43   0.00   5.00   10.00   15.00   20.00   25.00   30.00   2011   2012   2013   2014   2015   2016   2017   2018   2019   Passenger  Car  Sales(2011-­‐2019)(M)   Notes:  Data  from  CAAM  
  25. 25. 40+ LOCAL PASSENGER CAR BRANDS
  26. 26. CHINA BEFORE MARKET NAV RATE(2011-2019) 26 7.08%   7.52%   9.28%   12.70%   14.12%   16.54%   18.96%   21.38%   23.80%   0.00%   5.00%   10.00%   15.00%   20.00%   25.00%   2011   2012   2013   2014   2015   2016   2017   2018   2019   Notes:  Data  from  CAAM  
  27. 27. EUROPEAN OEM’S NAVIGATION IN CHINA •  Connected HU(call center, cloud search, infotainment, etc) •  Knob + some hot buttons to operate HMI •  Rich functions but w/ normal UE •  Chinese search UE is poor 27
  28. 28. JAPANESE OEM’S NAVIGATION IN CHINA •  Performance is amazing •  Traditional step by step HMI design •  Rich functions with many detail settings •  Chinese search UE is poor 28
  29. 29. US OEM’S NAVIGATION IN CHINA •  Relatively simple HMI design style •  Connected solution focus on safety and Remote control, lack of interaction with driver •  Lack of enough localization •  Chinese search UE is poor •  Whole system UE is normal 29
  30. 30. CHINA AFTER MARKET NAV RATE(2009-2014) 30 169.5   342.7   510.4   662.4   704.2   75.30%   102.20%   48.90%   29.80%   6.30%   0.00%   20.00%   40.00%   60.00%   80.00%   100.00%   120.00%   0   100   200   300   400   500   600   700   800   2009   2010   2011   2012   2013   volume   growth  
  31. 31. SMARTPHONE PROJECTION DRIVING COMMODITIZATION §  No differentiation between vehicle segments §  Same experience in every vehicle §  No head unit upgrade potential §  No control of UX & innovation 31
  32. 32. CONNECTED NAVIGATION LEVERAGE THE ENTIRE CANVAS & CAR DATA The car can surpass smartphone UX §  Instantly on §  Immediately helpful §  Surpass current expectation through customization and integrated experience 32
  33. 33. UNLOCKING THE DATA POTENTIAL TO DELIVER A SUPERIOR EXPERIENCE PERSONAL DATA VEHICLE DATA ENVIRONMENT DATA 33
  34. 34. OUR INTEGRATED SOLUTION SMART CLOUD MOBILE SDK LIVING MAP & BEST-IN-CLASS CONTENT AUTO HMI & SDK 34
  35. 35. WHAT WE LEARN FROM THEM 35 Chemical  ReacYon   Physical  ReacYon   Internet  +   +  Internet  
  36. 36. 36 Win-­‐Win:  In  Car,  Forget  the  Phone  
  37. 37. THANK  YOU   Manfred  Fu   傅杰伟

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