Developments &

Competition in

m2m Services

Dan Lloyd

Director , Strategy &

Corporate Affairs

Vodafone Australia

Outline

1. Vodafone’s m2m offering

2. Vodafone Global m2m Barometer 2013/14

3. Ovum Connected Nation – Australian m2m

2014-2019

4. Competition in m2m and Australian

communications

2

Over 300 dedicated M2M professionals

across five regions

Vodafone employs the largest

dedicated M2M team

of any mobile network operator, and

the team is growing

Vodafone Global M2M Team Countries Capabilities

Americas:

US

• Sales

• Solutions architect

• Project management

• Commercial

• Business development

• Service architect

• Implementation

consultant

APAC:

Australia, Hong Kong, India,

Japan, Korea, New Zealand,

Singapore, China

• Sales

• Solution architect

• Project management

• Commercial

• Business development

Northern Europe:

Belgium, Ireland,

Luxembourg, Netherlands,

Nordics, UK

• Sales

• Solutions architect

• Project management

• Commercial

• Business development

• Service architect

• Implementation

consultant

Central Europe:

Czech Republic, Germany,

Hungary, South Africa

• Sales

• Solutions architect

• Project management

• Commercial

• Business development

• Service architect

• Implementation

consultant

Southern Europe:

Greece, Italy, Portugal,

Romania, Spain, Turkey

• Sales

• Solutions architect

• Project management

• Commercial

• Business development

• Service architect

Vodafone’s m2m Partners We have established partnerships with global market

leaders to complement our offering, and provide complete

pre-integrated and tested solutions to our customers

4

Who Utilises Vodafone M2M

Vodafone M2M customers have grown from 3M to 16M

connections over the past 4 years

Independent analysts

recognise Vodafone

Positioned as a leader in the global M2M services market, April 2013

1st Place in M2M Communication Service Provider Benchmarking Study 2013

Third year in a row topped the rankings in Analysys Mason’s independent M2M annual scorecard – 2014

About the Barometer

• Global survey: over 600

responses

• Qualitative and quantitative

• 14 countries, 7 industries

• Independent research

• Leading analyst gives extra

insight

• Second year conducted

Split of

respondents

by region and

industry

sector

M2M goes mainstream Companies at

each stage of

M2M adoption,

2013/2014

of companies said that they are already using M2M —

that’s an increase of over 80% on last year

AMEAP leads regional growth

• Europe and Americas fell behind

• But all regions will have over 50% adoption by 2016

Companies with an M2M solution in

place by region, 2013/2014

Adoption in two years’ time

• 74% of consumer electronics will have M2M by 2016

• Manufacturing will be furthest behind, with 43%

Companies with an M2M solution in

place, 2013/2014

Benefits producing ROI

• Companies using M2M are starting to report “external”

benefits

• Those reporting increased competitive advantage leapt from

23% to 52%

Companies with M2M solutions in

place experiencing benefits,

2013/2014

Four steps to m2m success Make M2M central to strategy.

Be ambitious

Look for board-level sponsorship

and focus on cultural change

Combine M2M with other

technologies,

particularly big data

Consider security end-to-

end, from the start of your

planning

Strong growth forecast for

Australian m2m

13 Source: Ovum M2M Industry Forecast, September 2014

Majority of deployments

depend upon mobile

• Productivity challenges will make retail and wholesale the

top vertical

•M2M innovation will drive further adoption in transport and

logistics

•Healthcare is the vertical to watch

• Smart metering is poised to gain further momentum

•Manufacturers in Australia will strive for greater efficiency

• The connected is car expected to increase in popularity

14

Competition in m2m

•M2m necessarily a global ecosystem:

– Global standards, global manufacturing, global

supply chains

– Well established international roaming model for

m2m – GSMA recommendations, ITU number

ranges

•Fragmentation of domestic

approaches/bespoke solutions:

– Undermines efficiency/productivity

–Slows deployment and efficiency benefits. 15

Australia is a very unusual

market in revenue share ...

16

Canada Germany Australia France

66%

51%

Spain

52% 51%

UK Italy

49%

39%

31%

Incumbent share of Total Telecoms Revenue

2013, %

Source: Vodafone Group Analysis based on company reports.

Australia is a very unusual

market in EBITDA share ...

17

UK Spain Australia France

75%

61%

Italy

68%

57%

Canada Germany

55%

43%

37%

Incumbent share of Total Telecoms EBITDA

2013, %

Source: Vodafone Group Analysis based on company reports.

Australia is a very unusual

market in OpFCF share

18

UK Spain Australia Italy

85%

65%

France

79%

63%

Canada Germany

62%

48%

35%

Incumbent share of Total Telecoms OFCF

2013, %

Source: Vodafone Group Analysis based on company reports.

Substantial impact on

consumers...

19

0

20

40

60

80

100

120

140

160

180

Canada

€49

Germany

€ 68

UK

€ 65

France

€ 65

Australia

€ 164

Spain

€ 103

Italy

€ 85

Eu

ro/

Po

p

International benchmarking OFCF / Population

2013, Euro

OFCF/BITDA minus Capex. Source: Vodafone Group Analysis based on company reports.

Conclusions

•All signs point towards tipping point for m2m growth

globally and in Australia

•Massive potential productivity gains for Australian

industry and consumers through inherently global

model for m2m deployments

• Backdrop of disturbing domestic communications

market structure and barriers to competition

•Great opportunity for Australia in encouraging global

model

20