performance. > Strategic for Google: will make all its services smarter, not just its phones. ⢠Opening of AI to de
New Patterns of Consumption, New Patterns of Use? Paul Gray, Principal Analyst April 2017
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2
Contents • Quick roundup of television • UHD: beyond the television screen • Intelligence: at the edge of the network?
• Trust
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3
TV shipments mature; area growing rapidly Display area in TV (million m2) by region 300
180 160
250 200
120 100
150 80 100
60 40
50
Middle East and Africa Shipment (millions)
Area (millions m²)
140
Latin America Asia Pacific China Eastern Europe Western Europe North America Japan Shipments
20
0
0 Source: IHS
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
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© 2017 IHS
Premium large screen display trends: TV Bigger, more pixels, better pixels…cheaper 30%
• Higher resolution: 4K and now 8K appearing
25%
• Brighter (for high dynamic range): from 300cd/m2 (standard) to 1000cd/m2 peak
15%
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10% 5%
$9,500
$50,000
0%
$7,500
• Prices: still falling.
20%
$8,500
• Deeper colours: DCI-P3 gamut, towards Rec.2020
55"+ TV prices, by size and technology
$750 $1,250 $1,750 $2,250 $2,750 $3,250 $3,750 $4,250 $4,750 $5,500 $6,500
• Bigger: size growth by 1” per year
LCD TV UHD 55 LCD TV UHD 58 LCD TV UHD 60 LCD TV UHD 65 LCD TV UHD 70 LCD TV UHD 75 OLED TV UHD 55 OLED TV UHD 65
5
OLED: attractive alternative to sheer size? Significant number of European consumers choose OLED over a larger LCD • Most brands now using OLED as a premium offering
TV share: 55" OLED, 65" LCD, 65" OLED, 75"LCD
• Pricing positioned at comparable 10” larger LCD
80%
90%
• Many premium consumers choosing OLED over LCD – especially in Europe
70%
• 65” OLED out-shipping 75” LCD
50%
55" OLED
60%
65" LCD 65" OLED
40%
75" LCD
30%
• Endgame on screen sizes?
20% 10% 0% Japan Source: IHS
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North America
Western Europe © 2017 IHS
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Flat panel TVs don’t scale well beyond 65” Cannot rely on size alone to support the market… LCD TV packed weight and box volume v size 120
• Very much larger box for protection: corner drop.
100
• Increasingly difficult to transport • Shipping costs grow exponentially
Weight (kg)
• Extra metalwork for rigidity
1600 Weight / kg
1400
Volume / l
1200
80
1000
60
800 600
40
400 20
200 0
0 30 Reference data: Samsung Q8C series, excluding 88”
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Volume (litres / 000cc)
Flat panel TVs do not scale well beyond 65”:
Source: IHS
50
70
Screen size (inches)
90 © 2017 IHS
7
UHD: beyond the television screen
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UHD Content reinforces new consumption patterns Why was Reed Hastings at MWC? • Streaming services first to launch UHD content > Marketing strategy to support premium content positioning. • Equally encouraging mobile usage.
• UHD featuring like Dolby Vision now on phones: LG G6 (pictured)
• Blurring boundaries between TV and mobile viewing: it’s all long-form video! Source: LGE
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UHD movie title availability best from OTT streamers UHD title availability by service and delivery method 250 Physical Both EST & VoD EST Only SVOD VoD
200 150 100 50 0
0
50
100
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150
200
250
Amazon DirecTV M-Go
Netflix Ultraflix Vudu
Film most suitable for UHD, but SVoD giants’ UHD TV content critical to their businesses UHD Title availability
Amazon v. Netflix, by Genre 160
Documentary Events Film Sports TV series
140 120
100 80 Film
60
TV series
40
Events
20
Documentary Sports
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0 Amazon
Netflix
11
Intelligence: at the edge of the network?
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5G Low latency and low power most interesting • You cannot buffer perception! • Fast, ultra-reliable networks allow mobile technologies to address critical systems. • Ability to use far-flung computing and hardware resources > Amazon Web Services an early example
• Productivity growth moves away from simple access to investable capital?
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13
A new era of interactivity Buttons and sliders Pointing devices
Touch and Gesture
Network-based intelligence © 2017 IHS Markit. All Rights Reserved.
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Alexa, what is the forecast? Smartness transitioning from the device to the network. • Alexa, Bixby, Cortana, Google Assistant, Siri starting new era of interactivity. > Power of the network reinforces the device.
• New gatekeepers emerging, network effect heavily rewarded • Rewards to scale: better learning gives better performance. > Strategic for Google: will make all its services smarter, not just its phones. • Opening of AI to developers triggers wave of new integrations: > Cars, white goods, other CE devices. Source: Samsung
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Smart Speakers lead the charge Smart speaker forecast by platform • Prices will drop rapidly – plenty of scope for subsidy model.
30
• Alexa has lead from perfect timing, competition will intensify from other platforms and devices.
25
• Device makers largely agnostic, support for multiple platforms likely.
• Smart speaker installed base over 59 million units in 2020, from 6 million in 2016
Apple Siri Google Assistant
Shipment (millions)
• Google will accelerate as developers gain momentum
Other / Proprietary
20
Amazon Alexa Sonos
15
10
5
0 2014 Source: IHS © 2017 IHS Markit. All Rights Reserved.
2015
2016
2017
2018
2019
2020 © 2017 IHS
16
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Where does privacy fit in a hierarchy of company needs? Privacy Brand Sustainable business model
Profitable
Product doesn’t harm customers © 2017 IHS Markit. All Rights Reserved.
18
Where does privacy fit in a hierarchy of company needs?
Or is it here?
Privacy Brand Sustainable business model
Profitable
Product doesn’t harm customers © 2017 IHS Markit. All Rights Reserved.
19
Thank you! Questions? Paul Gray,
[email protected] +44 7810 854646
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