Wenbing Yao - Director of Strategy & Marketing Huawei UK

Connect where it countsMapping your transformation into a digital economywith Global Connectivity Index 2016

3

Content

Why GCI

GCI MethodologyCall to Action

GCI 2016 Key FindingsNational analysisIndustry analysis

4

Why GCI

5

A revolutionary shift is happening in the way the world works, with economies across the planet going digital fast

The Global GDP forecast 2016

0-2%

2-4%

>4%

WORLD TOTAL

2.7

Source：Economist Intelligence Unit

Western Europe

1.8

North America

2.3

Eastern Europe

1.2

Middle East/North Africa

3.0

Latin America

0.6

Sub-Saharan Africa

3.5 Australasia

2.6

Japan

1.7

Asia

5.4

140 countries have developed national broadband plan strategy or policy - ITU

Industry 4.0 Internet PlusAdvanced Manufacturing 2.0

Singapore Smart Nation Digital Canada 150 Smart Digital Malaysia

Nigeria NationalBroadband Strategy

Colombia Live Digital Connected Argentina

Countries are setting policies to encourage ICT investment

6

GCI：Benchmarking digital economy transformation

Traditional Economy Digital Economy

The GCI provides a comprehensive and objective assessment of a country’sconnectivity from both a national and business perspective, and assesses thecurrent status, future trends, and challenges associated with digital transformation.It quantifies the value that connectivity generates for a country’s transformation intoa digital economy, and serves as a reference for regional and national policymakers.

7

GCI: Focusing on economic digitization since 2014

Scope

Research theme

White paper

2014 1st releaseNew economic barometer

2015 2nd releaseFull national assessment

2016 3rd releaseDigital economy model

25 nations 16 indicators

50 nations38 indicators

50 nations40 indicators10 verticals

8

GCI Methodology

9

GCI methodology matrix: 4 economic pillars by 5 technology enablers

SUPPLY DEMAND EXPERIENCE POTENTIAL

Fundamental : e.g ICT laws, application, e-Government, R&D …

GCI Scoring Model

IOT

BIG DATA

CLOUD

DATA CENTERS

BROADBAND

5 Tech Enablers

10

SDEP: 4 pillars encompass the entire chain of ICT development to provide a 360-degree view of the digital economy

SUPPLYMeasures current level of supply for ICT products and services.

DEMANDGauges demand for connectivity in the context of users and activity.

EXPERIENCE:Analyzes the experience of connectivity for end users and organizations

POTENTIALComprises a forward-looking set of indicators that point towards the future development of the digital economy

PotentialDriving Digital

Future Momentum

11

Realizing economic transformation with 5 technology enablers

Communication and computing network forms the foundation of connectivity

Cloud Services enables the distribution, adoption and access to the communications and computing

foundation

Big data analytics runs on top to convert data into information and

information into solutions and innovation

IoT turns most things into autonomous computing

systems that collect data, provide solutions, and drive

innovation

Future technologies riding on smart IoT drive

augmented innovation

Broadband

Data Centers

Cloud

Big Data

Internetof Things

Communication foundation for collecting and sending data to users and machines.Availability and affordability are demand drivers.Security and responsiveness are experience drivers.

Computing and storage facilities for providing computing power and warehousing data.Access and scalability are demand drivers.Responsiveness and computing power are experience drivers.

Distribution model for mass market access to computing and storage capabilities.Access and affordability are demand drivers.Security and responsiveness are experience drivers.

Applications and analytics convert data into information and insights.Data abundance and computing capabilities are demand drivers.Data quality and real-time are experience drivers.

Sensor and actuator networks for data collection and response.Availability of network and application areas are demand drivers.Quality analytics and applicability are experience drivers.

12

GCI 2016 research scope

Industry view analysis

Nation view analysis 50

countries

90%GDP

78%population

3000firms

10Vertical

10nation

13

Country evaluation done based on 40 indicatorsSupply Demand Experience Potential

Fundamentals

Broadband

Data Centers

Cloud

Big Data

IoT

ICT Investment

Telecom Investment

ICT Laws

International Internet Bandwidth

Fiber Optic

4G Coverage

Data Center Investment

Cloud Investment

Big Data Investment

IoT Investment

App Downloads

Smartphone Penetration

eCommerce Transactions

Computer Households

Fixed Broadband Subscriptions

Mobile Broadband Subscriptions

Data Center Equipment

Cloud Migration

Analytics Data Creation

IoT Installed Base

E-Government Service

Telecom Customer Service

Internet Participation

BroadbandDownload Speed

FixedBroadband Affordability

Mobile Broadband Affordability

Data Center Experience

Cloud Experience

Big Data Experience

IoT experience IoT Potential

Big Data Potential

Cloud Potential

DC Potential

Mobile Potential

Broadband Potential

Software Developers

IT Workforce

ICT Patents

R&D Expenditure

14

GCI 2016 Key Findings:National analysis

15

GCI 2016 key findings

Economic digitization is accelerating as strong digital infrastructure improves the quality of economic growth.

GROW

Not all countries are fully reaping the benefits of the digital economy.

GAP

Some countries show fewer gains than others, but there are clear ways for them to improve.

IMPROVE

Five technology enablers pave the way for national-level transformation into a digital economy.

ENABLER

GROW GAP IMPROVE ENABLER

16

Transformation into a digital economy is accelerating

51%

6.45

18%

61%

65%

GCI2016

GrowthGCI2015

Smartphone Penetration

4G Coverage

Analytics Data Creation

44%

13%

3.91

21%GCI score

From43.4

To45.5

Global connectivity

5%


17

Digital infrastructure drives the quality of economic growthA one-point increase in GCI does the following for your nation:

Inclusive development

Improving productivity as it brings rural and

disadvantaged communities into the digital economy.

Innovation-driven development

Disrupting and reconstructing traditional industries, boosting efficiency and specialization

Sustainable development

Driving long term competitiveness in the face of emerging environmental concerns and regulations

1ptIncreasein GCI

2.1%Increase in

competitiveness

2.2%Increase in Innovation

2.3%Increase in productivity


18

Most countries have embarked on the road to a digital economy, but they are at different stages

Developing countries


ICT investment per GDP

IT workforce IoT install base per capita

App downloads per capita

Mobile broadband subscriptions per

capita

2% 0.4%1 19 43%

5%2.8% 6

3599%

Developed countries

19

Country ranking and performance


Frontrunners SCORE

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

United States

Singapore

Sweden

Switzerland

United Kingdom

Denmark

South Korea

Netherlands

Japan

Norway

Australia

Germany

France

New Zealand

Canada

Belgium

74

72

70

68

65

64

63

63

62

61

59

59

58

58

57

57

Adopters SCORE

17

18

19

20

21

22

23

24

25

26

Spain

Portugal

UAE

Czech Republic

Qatar

Italy

China

Chile

Malaysia

Russia

51

50

50

48

47

46

44

44

44

43

Adopters SCORE

27

28

29

30

31

32

33

34

35

36

37

Poland

Saudi Arabia

Romania

Brazil

South Africa

Mexico

Colombia

Thailand

Turkey

Argentina

Peru

43

43

42

39

39

38

37

37

37

36

35

Starters SCORE

38

39

40

41

42

43

44

45

46

47

48

49

50

Philippines

Egypt

Venezuela

Indonesia

Morocco

Vietnam

India

Algeria

Kenya

Ghana

Nigeria

Bangladesh

Pakistan

33

32

32

32

30

30

30

28

27

27

26

23

21

20

Country ranking comparison

Drop inGCI Ranking and

Score

Rise inGCI Ranking and

score

-2

2

6

-6

5 20 40

Note: For comparison, scores and ranks for 2015 have been recalculated using GCI 2016 methodology


10 15 25 30 35 45 50

4

-4

21

The GCI metric reliably indicates where a nation is located on the road to a digital economy


85K

55K

25K

GCI 2016 SCORENO

MIN

AL G

DP

PER

CAP

ITA

35 55 85Pakistan Bangladesh

Algeria

Kenya

Nigeria

VietnamIndia

PhilippinesEgypt

Venezuela

MoroccoGhana

IndonesiaPeru

TurkeyMexico

ThailandColombia

South Africa

Brazil RomaniaRussia

Saudi Arabia

Argentina

ChinaMalaysia

ChilePoland

Czech RepublicPortugal

Italy

Spain

United Arab Emirates

South Korea

Japan

New Zealand

Belgium

CanadaGermany

France

Netherlands

United Kingdom

AustraliaDenmark

SwedenSingapore

United States

Qatar

Norway

Switzerland

Strongest Multiplier effect*

Starters Average US $ 3,000 GDP

Adopters Average US $ 15,000 GDP

FrontrunnersAverage US $ 50,000 GDP

22

Countries with different levels of connectivity should have different development focuses

0

10

20

30

40

50

60

70

80

Supply Demand Experience Potential

starters Adopters Frontrunners

Starters: Focus on increasing ICT supply to give more people access to the digital world

Adopters: Focus on increasing ICT demand for industry digitization

Frontrunners: Focus on improving the experience of ICT users for efficient and smart socioeconomic development


23

Indonesia: Increasing ICT supply to give more people access to the digital world, 90% of investment is on ICT hardware

Policyis making its

difference

Indonesia Broadband Plan (IBP)

On a national scale, the IBP aims to provide fixed connectivity through fiber alongside mobile voice and data services, and through its usage to formulate a 5G service plan by 2020.

Getting the nation healthy withIndonesia Sehat (Healthy Indonesia)

ICT was introduced into the healthcare system in 2014, a central feature of which was a smart health card for each citizen, which has in large part driven the Indonesian Broadband Plan (IBP) alongside the faster rollout plan for rural Indonesia by 2019.

Data center networks:an international approach

The government is starting many partnerships with foreign tech vendors such as Japan’s NTT on the processes and core infrastructure for upgrading DC services.

Big gains with big ICT investment

Industry levelCountry level

8.3 %

US$33 billion in ICT investment in 20168.3 percent growth compared with 2015

US$33billion

20152016

Media and communicatio

n

BFSI

US$4billion

US$1.2billion


24

China: Increasing ICT demand for industry digitization and high-quality economic growth

Tapping onits potential

Going digital by increasing ICT demand

E-commerce is on the rise –between 2006 and 2014,shipping leapt tenfold from 1 billion to 10 billion packages delivered.

video is becoming the new star of the show – a total of 46.6 million homes were enjoying IPTV in China in 2015, a 13-million jump from 2014.

China is eyeing cloud services, big data analytics, and IoT with slew of initiatives concentrated in selected sectors of the economy.As the fourth largest country in the world in physical size, the government faces a Herculean task to push coverage and impressive initiatives like 4G and FTTH, to a wider base. There’s also much to be done to encourage enterprises to harness the power of the cloud by solving security, latency, and broadband issues.

Next step: a truly digitalChina will take shape

Facilitating high-quality economic growth

ICT spending: China spent

US$415billion in 2015.


IPTV

25

The UK: Boosting user experience and using big data analytics and IoT to develop a smarter, more efficient society

Driving change from the top with IoT

Today, the UK government is on a mission that it’spassionate about: enhancing the island nation’sconnectivity over the next five years by boostingaccess to superfast broadband and 4G

95% of properties willhave superfast

broadbandBy 2017

Boosting user experience

Big spending on big data

The government has stepped up spending on big data. In February 2014, it allocated ￡73 million to big data research, including ￡50 million on bioinformatics, ￡4 million on 21 open data projects, ￡14 million on 4 new research centers, and ￡4.6 million on 24 projectscentering on environmental data.

Great importance to the IoT’s future

In addition to investing in big data, the UK government committed ￡40 million to the IoT UK program in September 2015.

As part of the government’s digital economy strategy, the UK has also pledged ￡30 million a year between 2015 and 2019 to support IoT innovation.

It’s not just the government manning the helm; movers in the private sector, notably telcos and IT service vendors, are pushingIoT growth by launching new services.


26

Countries need to move up the technology stack to drive further GDP gains and enter the Augmented Innovation stage

Foundation Innovation Internet Innovation Data Innovation Augmented Innovation

IoT-centric

Big Data-centric

Cloud -centric

Datacenter-centric

Broadband-centric

Nom

inal

GD

P pe

c C

apita

15 10035 55 85

80K

0K

Countries in this stage are still building their foundation.

Countries in this stage have already invested in connectivity technology and are looking to drive cloud adoption.

These nations represent the current GCI leadership. Focus continues to be on big data and the drive towards IoT adoption.


No country has yet reached this stage. big data maturity incorporated into smart IoT

27

Countries need to develop ICT technology based on their specific situations

0

10

20

30

40

50

60

70

80

Broadband Data centers Cloud Big Data IoT

starters Adopters Frontrunners

Starters: Focus continues to be broadband and data centers investment

Adopters: Cloud migration and driving adoption continue to be a focus

Frontrunners: Focus continues to be on big data and the drive towards IoT adoption


28

Case: SMART TRANSPORTATION

Smart TransportationTHE FIVE TECH ENABLERS IN ACTION: SMART CITIES

CamerasShows congestion

and detects accident areas

IoT Sensors & DevicesSensors embedded in roads

record traffic density and speed

Data CenterStores the high volume of data

Provides high-powered computing resources

Cloud ServicesCloud services are a good way to deploy compute capabilities

across different regions departments

and technology platforms

Big Data AnalyticsProcesses data in real-time, considers other roads and weather conditions, compares

historical road usage patterns, consider school locations and office work hours to avoid rush hours.

High speed broadband network

provides the connectivity

Smart Devices

Traffic signals divert drivers to alternate routes

Smart cars change alternative routes

More trains & busses are deployed

People are instructed to leave earlier or later or use

alternative transport


29

GCI 2016 Key Findings:Industry analysis

30

Industry digitization and national GCI scores positively correlate

80

60

40

20

0

GC

I SC

OR

E

IND

ON

ES

IA

ME

XIC

O

SO

UTH

AFR

ICA

BR

AZI

L

MA

LAYS

IA

CH

INA

UA

E

GE

RM

AN

Y

UK

US

A

DX

SCO

RE

100

75

50

25

0

16 2015

25 2331 28

54 54 54

32

38 39 3944 44

50

5965

74

DX: Industry digital transformation

31

Industry digitization: the BFSI sector leads

BFSI ICT Logistics Resources Retail Education Government Manufacturing AgricultureHealthcare

Industry digital transformation

BFSI = Banking, Financial services and Insurance

32

Broadband investment is a key requirement identified by industries to build a digital economy

Technologies that companies believe will impact their business the mostPriorities for investing in technologies in 2016

Starters Adopters Frontrunners

Broadband Data center Cloud Big data IoT

Broadband Data center Cloud Big data IoT

Starters Adopters Frontrunners

33

Call to Action

34

Considerations:

Policies institutions and incentives：

Policies set the direction of digital transformation, and form the legal basis for a nation to act.

Incentives set the speed and depth of change and institutions drive change, provide governance, and monitor progress.

Manpower and skills：

Skilled manpower is at the heart of digital transformation. Technical, management, policy, and planning skills are all needed.

IT literacy is crucial as it affects how digital content is consumed and adopted by people at large.

Digital ecosystem:

Governments need to take the lead in digitally transforming themselves, driving cross-industry collaboration, and building long-term partnerships with the private sector and the financial world to create a robust ICT ecosystem.

35

Recommendations for Starters:

Policy Markers

Industry Leaders

Increase ICT investment as a percentage of GDP to expand mobile broadband nationwide.

Reduce tariffs and subsidize smartphone adoption to get smart devices into homes.

Promote investment in DCs by third parties to meet national computing needs.

Open up the market to telcos to widen coverage and make broadband affordable through competition.

Plan high-speed broadband through 4G and FTTH rollout.

Act now to plan digital transformation initiatives, even if it’s only high-speed broadband for e-commerce. The majority of enterprises in the Foundation Innovation stage are in Phase 1 of digital transformation – now is the time to get ahead.

Lobby the government to define a national standard for high-speed broadband bandwidth, coverage, and speed over the next one to two years to support industry digitization.

Step up cloud services to support digital transformation.

36

Recommendations for Adopters

Policy Markers

Industry Leaders

Prioritize government digitization so governments can serve as leaders in digital transformation.

Encourage enterprises, the government, and consumers to adopt cloud services.

Encourage enterprise to use Software-as- a-Service to promote efficiency and lower costs.

Encourage technology startups to use Platform-as-a-Service to encourage innovation and lower the bar for market entry.

Develop plans for rolling out big data analytics to support industry digitization.

Assess the overall digitization status of enterprises and industry, and develop a clear mandate for adopting the five technology enablers to transform verticals and enterprises.

Use the affordable and scalable architecture of cloud services to enable digital transformation initiatives and deploy ICT solutions.

Integrate big data analytics solutions to shift national digital transformation from Adopter to Frontrunner and industry digitization from Phase 2 or 3 to Phase 4.

37

Recommendations for Frontrunners

Policy Markers

Industry Leaders

Develop industry ecosystems that enable cross-industry collaboration to produce new IoT ideas, products, andservices that can change how business is conducted.

Upgrade to ultrafast, low-latency, next-gen networks.

Accelerate cloud services in all verticals so the cloud can become the platform for ubiquitous computing.

Promote government and enterprise investment in big data analytics by making anonymized public data available; incentivize the use of analytics and provide training in its use for all enterprises.

Develop strong data policies to make more data available for sharing to enrich the value it provides; build a robust data market framework for sharing anonymous data for analytics; make the government database library available.

Assess industry and enterprise digitization levels to develop a clear mandate for adopting the five technology enablers for transforming verticals and enterprises.

Invest in big data analytics and use public data, operating data, and customer data to raise productivity and innovation.

Join industry innovation clusters to create new products and services that can disrupt competition and create new markets.

38

A snapshot of GCI 2016

Supply10 indicators like

4G, broadband, andinvestment analyze

AVAILABILITY

Demand10 indicators

such as e-commerceand app downloads

analyze national techADOPTION

Experience10 indicators

includingdownload speedsand broadband

affordability analyzeQUALITY

Potential10 indicators likepatents and R&D

analyze futureCAPABILITIES

IoT

Big Data

Cloud Services

Data Centers

Broadband

FoundationInnovation

InternetInnovation

DataInnovation

AugmentedInnovation

StartersAdopters

Frontrunners

economic pillarsthat underpin

clusters emerged in 2016Where are you?

50

40

4

5

4

3

countries

indicatorsmeasure

tech enablerswhich determine

stages ofinnovation

and

For

The GCI is a rich and deep dataset that serves as a blueprint for individuals and organizations to analyze a wide range of factors relating to digital transformation, ICT development, and the economic benefits of connectivity. The overall index rankings provide a snapshot of the current state of connectivity across the global digital economy, forming a leading indicator for the next decade of ICT expansion and evolution.

To further explore the Index and download the entire whitepaper visit:www.huawei.com/gci

http://www.huawei.com/gci

Copyright©2016 Huawei Technologies Co., Ltd. All Rights Reserved.The information in this document may contain predictive statements including, without limitation, statements regarding the future financialand operating results, future product portfolio, new technology, etc. There are a number of factors that could cause actual results anddevelopments to differ materially from those expressed or implied in the predictive statements. Therefore, such information is provided forreference purpose only and constitutes neither an offer nor an acceptance. Huawei may change the information at any time without notice.

Thank you

Wenbing Yao - Director of Strategy & Marketing Huawei UK

Technology

Transcript of Wenbing Yao - Director of Strategy & Marketing Huawei UK