1. m2mSmart World
How the Alliances are Driving the M2M Ecosystem
Telefónica Digital
25th April 2013

2. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Telefónica Key Figures
• Operations in 24 countries
• 130,250 professionals
• Consolidated revenues of 62,356 million euros
• 315,7 million customers
(December 2012)

3. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Global Coverage
Operations
in 24 countries
Industrial Alliances

4. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Telefónica Digital
§ Telefónica Digital is a established global business unit (headquartered in London with
regional centres in Silicon Valley, São Paolo, Spain, Tel Aviv, etc.) aimed at responding to the
basic trends of the digital revolution:
• Connection anytime/anywhere and high speed data networks.
• Smartphones and other devices going mass market.
• Integration of digital innovations into business models.

5. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Horizontal Solution and Vertical Applications
m2m SDP
Supervision & Control tools
m2m BSS
Specific Core Network
Multi Bearer
HORIZONTAL
m2m
SERVICE
End-to-end Services
for the diverse Vertical
m2m Vertical Markets
An Horizontal m2m
Service for providing
connectivity + VAS.
Support specialized
vertical services
E-health Security Financial
Services
Connected
Car
Fleet
Management
Utilities Consumer
electronics
Smart
Cities Telemetry

6. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Device/Module/
SIM manufacturer
Network Connectivity Application
Developer
Service Provider
IntegratorSES*
VAS
Corporate
Customer
End User
• M2M services are part of the core business of the companies and have specific characteristics that
imply a different working model of the companies involved in the M2M arena.
• It's necessary a partnership between the different members of the value chain to cover sectorial
customer requirements related to security, availability, control, customer experience and business
model of M2M markets.
• Development of end-to-end best in class solutions for different sectors implies to work with other
Telcos, customers and Partners.
• Partnering will benefit cooperative parties by creating scale and market power, which will:
¤ Create new market dynamics and
¤ Generate new business models
M2M Value Chain - Collaboration

7. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Our challenge
Device/Module/
SIM manufacturer
Network
Connectivity
Application
Developer
Service Provider
IntegratorSES*
VAS
Corporate
Customer
End User
Telefónica Core
& Telco Allies
Telefónica &
Best Partners by Sector
Telefónica & Customers:
Tools to access end-user market
Alliances and
negotiation
Players are expanding along the value
chain to capture customer relations
with integrated offers
Managed Connectivity
vs.
end-to-end services
*Service Enablement Services

8. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Creating an eco-system of Partners
Due to the fragmentation of the
M2M Value Chain, development
of end-to-end best in class
solutions implies to work with
Partners.
m2m Partner Eco-system
“Program” aiming at bringing together the world class M2M players
along the value chain to rapidly create applications and services
Industry and market dynamics limit
any one service provider’s ability to
drive significant change by “going it
alone”.
Some programs and tools
must be put in place to make
this process easier in creating
a rich ecosystem of valuable
partners.

9. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Device/Module/
SIM manufacturer
Network
Connectivity
Application
Developer
Service Provider
IntegratorSES*
VAS
Corporate
Customer
End User
1) DEVICE/ MODULE & SIM MANUFACTURER
- Standardization, innovation and commercialization
- Indirect channel for small integrators and SMEs
3) NETWORK CONNECTIVITY - TELCOS
- Joint commercial & solution efforts to look for a unique and very powerful geographic solution based
proposition
- Share platforms and identify “ready” end-to-end solutions & partners for different sectors (automotive,
utilities, smart cities,...)
5) SES
- Innovation, product and commercialization
7) DEVELOPERS, INTEGRATORS, SERVICE PROVIDERS AND CUSTOMERS
- Fostering the third party niche vertical development
- Partnership in integration and/or commercialization
Telefónica m2m Partner Program

10. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Devices
Global strategic partnership Telit & Telefónica,
• Offer to all the customers the premium value-
added services, customer support, module
innovation and global connectivity previously
reserved for larger firms.
M2M Air
–
Connected Modules

11. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Subscription Management
• Partnership with G&D to demonstrate a working solution for remote subscription management and a unique
multioperator SIM:
- Review the eSIM concept & architecture: Define business logic & work in the different business models
- The trial began on 11/2011, using G&D SIM Cards, Samsung Tablets and Telit modules
- Involving Telefonica Operators (Movistar SP, O2 UK, O2 DE) and Telco partners (China Unicom, Telstra…)
• Today is a Commercial Solution!

12. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
n Global solution: The agreements enable joint commercial efforts to look for a global solution based
proposition. This is particularly important for M2M opportunities that require multiple services over large
geographical areas: It's about Communication but also about Operations
M2M Global Customer Requirements
Requirements
• one portal
• a unique SIM
• a common APN
• a single VPN
• a joint customer service
• Unique/several invoicing
• Local /lowest prices
• Permanent roaming solution
• Multioperator solution with local
subscriptions
Solution
It´s mandatory the collaboration
between operators!

13. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Coopera'on
Areas
Marke'ng
/
Strategy
Customers
(enhancing
footprint)
Ver'cal
services
Pla?orms
Technological
coopera'on
(standards,
cer'fica'on,
tes'ng,
field
trials,
R&D)
1 2 3 4 5
Telco m2m Partnership
Objective
Create a Global M2M Alliance
§ To increase market awareness and to expand footprint globally through partnerships
§ To increase efficiency and new vertical revenue streams

14. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Multi Operator Alliance
• KPN, NTT DOCOMO, INC., Rogers, Singtel, Telefónica, Telstra and
Vimpelcom entered into an agreement to initiate collaboration
with respect to their M2M businesses
- Focus on create M2M echo-system and global
multioperator products
- Open to new members to fill the geographic gaps.
!
• First results:
- Alliance as a structured working group
- Presentation of the Multioperator unique SIM & Platform
Demo at MWC
- Etisalat as a new member

15. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
M2M Multi-operator Alliance Footprint
Global Coverage
Bangladesh
Russia
PakistanIndia
Thailand
Canada
Puerto Rico
Venezuela
Brazil
Argentina
Uruguay
Chile
Ecuador
Panamá
El Salvador
Guatemala
Nicaragua Colombia
Peru
México
Costa Rica
UK
Germany
Czech R.
Ireland
Belgium
Slovakia
Spain
Italy
The Netherlands
Algeria Libya Egypt
KSA
Central African
R.
Australia
New
Zealand
Japan
Sri Lanka
Indonesia
Philippines
Armenia
Georgia
Kazakhstan
Uzbekistan
Kyrgyzstan
Tajikistan
Cambodia
Laos
Afghanistan
Myanmar
Ukraine
Singapore
Burundi
Zimbabwe
Benin, Gabon, Ivory
Coast, Togo
Niger,
Nigeria
UAE
Tanzania

16. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
M2M Alliance Extended
Global Coverage
Bangladesh
Russia
PakistanIndia
Thailand
Canada
Puerto Rico
Venezuela
Brazil
Argentina
Uruguay
Chile
Ecuador
Panamá
El Salvador
Guatemala
Nicaragua Colombia
Peru
México
Costa Rica
UK
Germany
Czech R.
Ireland
Belgium
Slovakia
Spain Italy
The Netherlands
Algeria Libya Egypt
KSA
Central African
R.
Australia
New
Zealand
Japan
Sri Lanka
Indonesia
Philippines
Armenia
Georgia
Kazakhstan
Uzbekistan
Kyrgyzstan
Tajikistan
Cambodia
Laos
Afghanistan
Myanmar
Ukraine
Singapore
Burundi
Zimbabwe
Benin, Gabon, Ivory
Coast, Togo
Niger,
Nigeria
UAE
Tanzania
Denmark
Norway
Sweden
Hungary
Serbia
Turkey
Switzerland

17. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
SES
• Innovation, product and commercialization

18. © Telefónica Digital | All rights reserved m2m18
End-to-end Services - Fleet Management
Fleet Management over the basic tracking service :
§ Visualization as the tool set to position and visualize assets
§ Protection regarding Safety and Security issues
§ Productivity & Sustainability to improve business processes,
increase efficiency and reduce pollution.
ScreenWatcher
• Rich-detailed mapping &
resource Visibility
• Real-time & historic
information
VISUALISATION
PROTECTION
PRODUCTIVITY &
SUSTAINABILITY
Sustainability
Out-the box track & trace monitoring
Employee Protect
• Out-the box track & trace monitoring
Risk Director
• Driver behaviour metrics, Safety &
Security services enabler
Duty of Care
• Manage corporate responsibilities:
driver insurance & health, vehicle
license and taxes, ...
• Out-the box track &
trace monitoring
Business Improvement
Data Analyser
• Resource visibility,
alerting &
exception
reporting
Sustainability
• Tracking, navigation &
communications,
Productivity Visibility, Job
Scheduling
• Business Intelligence
reporting
Global Unit

19. © Telefónica Digital | All rights reserved m2m19
Value
Proposition
insurers
driversCustomer
Needs
End-to-end Services - Insurance Telematics
drivers
insurers
• Need to save on premiums
• Increasing demand of parental control
• Need to expand current portfolio and differentiate from competitors
• Need to optimize operations
• Lack of levers for customer loyalty
• Stop increasing costs from fraud
• Increase accuracy in Risk Pricing and retain best drivers
• Improve Combined Ratio: reduce Costs and Claims Ratio
• Reduce Fraud
• Improve Customer Experience and Loyalty with additional interactions to
deepen relationships
• Differentiating product with unique features to capture new customers
Young drivers (18-25 years old) and young drivers’ parents
• Understand and improve the way of driving by monitoring driving patterns
• Vehicle crash detection and automatic notification
• Vehicle location, parental control, driving behaviour tips, maintenance reminders
and social network integration among others
young
drivers
their
parents
Global Unit

20. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Risks of no collaboration
• 50 billion devices will impose tough requirements to the networks.
Risk of not having them well prepared. Lack of interoperability.
• Lack of standards in m2m related to Telecommunications and the
industries involved (automotive, utilities…) bringing fragmentation.
• Local regulations that imply that without cooperation between Telcos,
global solutions will become impossible.
• Unfavorable component and device economics due to isolated
development and requirements.
• Clients driving the development of closed, non largely deployable
solutions (m2m Project Islands).
• No economies of scale neither in service nor in technology harmonization.
Higher costs and, therefore, higher prices for customer or less sales and
margins.
• No business models developed. Market dynamics slowing down.

21. © Telefónica S.A | Todos los derechos reservados m2m
Global Unit
Summary
• m2m will be the “next big thing” and we have to develop attractive value
propositions on both horizontal and end to end vertical services.
• Due to the different sectors, regions and type of customers, we have to
adapt the m2m products and commercialization channels to fulfill de diverse
customer needs.
• Partnerships are critical to capture the value opportunity. Companies from
different sectors and regions should collaborate looking for “Wold-Class-
Products”

22. Angel David García Barrio
Head of Alliances & New Businesses. Global m2m. Telefonica Digital
Chairman. Multi Operator Alliance
angeldavid.garciabarrio@telefonica.com