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John DeLoche
*Co-founder and Managing Director*
Rosemont Seneca Technology Partners
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---------- Forwarded message ----------
From: Greg Arrese <GArrese@scogcap.com>
Date: Thu, Apr 3, 2014 at 11:41 AM
Subject: IoT piece--
To: Lawrence Lenihan <LLenihan@firstmarkcap.com>, Paul Cianciolo <
PCianciolo@firstmarkcap.com>, Thanasis Delistathis <Thanasis@navfund.com>,
Aileen Lee <alee@kpcb.com>, Steve Harrick <sharrick@ivp.com>, Bob Chicoski <
BChicoski@saturnasset.com>, Greg Gottesman <greg@madrona.com>, Erik Benson <
benson@voyagercapital.com>, "ahn@voyagercapital.com" <ahn@voyagercapital.com>,
"chip@tribecavp.com" <chip@tribecavp.com>, "JRojas@kennetventures.com" <
JRojas@kennetventures.com>, Brian Garrett <brian@crosscutventures.com>,
"Garrett, Paul" <pgarrett@ashcroftgroupllc.com>, "gsolomon@ggvc.com" <
gsolomon@ggvc.com>, John DeLoche <jdeloche@rosemontseneca.com>, Trent Gegax
<trent.gegax@gramercyfund.com>, Mike Galgon <mike.galgon@live.com>, "Chris
Saridakis (personal)" <chris@greatbarnventures.com>, Rudy Gadre <
gadrrx@hotmail.com>, Geoff Entress <Geoff@entress.com>, Scott Roberts <
sroberts@linkedin.com>, Zac Zeitlin <zz@ngv.us>, Jeffrey Silverman <
jeffrey@laconiaventures.com>, Andrew Wright <andrewwr@me.com>, HENRY
PARRY-OKEDEN <henry@oakview.co>, Charles Fitzgerald <charlesf@fitzopolis.com>,
"johnkeister@hotmail.com" <johnkeister@hotmail.com>


Good read from Morgan Stanley - the impact of the Internet of Things
economy and opportunities across several industries.


It was published today--


Greg


*From:* Thomas Wigg [mailto:thomas.wigg@morganstanley.com]
*Sent:* Thursday, April 03, 2014 2:18 PM
*To:* Greg Arrese
*Subject:* MS Tech: Internet of Things Blue Paper + Group Lunch on Monday
-- AAPL, ARM, ATML, CCI, CODE, CRM, CSR, FSL, GOOG, IMG, INTC, LLTC, MCHP,
NXPI, SAP, SPLK, STM


*Additional Attachment(s):*
The 'Internet of Things' Is Now: Connecting the Real
Economy<https://ny.matrix.ms.com/eqr/article/webapp/f22c9d50-baa8-11e3-bd9c-a752fc238000?t=1396548982%3A497%3A3501%3Ahz829c3n6&m=1&ch=Outlook%20Blastmail>


*MS Global Research* has a Blue Paper report out on *Internet of
Things*that a) *includes
a full perspective on the impact for Semiconductors, Telecom Services and
Software sectors*, and b) *shows the potential impacts on a variety of
other industries*.


Big picture, the Team believes that *price reduction and standardization of
key hardware and software components will help further drive the Internet
of Things*, while *integration with Big Data/Analytics*, from which
corporates in various sectors can increase revenues and reduce
inefficiencies, will also be an important driver.


We are hosting a *Group Lunch on Monday April 7 in NYC* with *Keith Weiss
(Software), Francois Meunier (EU Semis/Comm) & Katy Huberty (Hardware) *to
discuss this report. Please let me know if you'd like to join (*12ET
Monday, MS Offices 48th & Broadway, 41st Floor*).


The non-tech industries identified with the greatest potential impact are:
*Utilities* (smart metering and distribution), *Insurance* (behavior
tracking and biometrics for Auto and Life product lines), *Capital*
*Goods*(factory automation, autonomous mining),
*Agriculture* (yield improvement), *Pharma* (clinical trial monitoring),
*Healthcare* (leveraging of human capital and clinical trials),
*Medtech*(patient monitoring), and
*Autos* (autonomous driving).


*Within Tech/Telecom, the key exposed companies in MS coverage are: AAPL,
ARM, ATML, CCI, CODE, CRM, CSR, FSL, GOOG, IMG, INTC, LLTC, MCHP, NXPI,
SAP, SPLK, STM, Realtek and Richtek.*


*Quick One-Liners on sector implications:*


-*Software:* The most obvious area of opportunity is *data management*, as
IoT creates new varieties of data as well as greater data volume, plus
companies will also have to a) analyze, interpret and apply the data, which
will drive spending on real-time and predictive analytics and b) present
the data from the analysis to end users for them to take action, or
automatically to initiate a new process*. This could result in a surge in
the growth of new software applications that will require new development
platforms*. Names in play: *SAP, Software AG, PTC, CRM, SPLK, and
Dassault. *


-*Semis: *The ever smaller and cheaper semiconductors are also packing more
functionality into one chip, helping to drive more integration and
connectivity, while semiconductors are increasing the level of
standardization through Bluetooth SMART, which has compatibility with any
smartphone/ tablet at a lower cost than WiFi. Net, if the Internet of
Things really takes off, there could be significant increase in demand for
semiconductor content on the server side to handle increasing interaction
with sensors and analytics/Big Data. Companies levered to the Internet of
Things and critical components include *ATML* (32-bit MCUs),
*LLTC*(industrial automation),
*CSR* (Bluetooth SMART), *CODE* (MCUs) and *MCHP* (MCUs).


-*Telecom Services:* While the number of potential devices on carrier
networks is huge as a result of the Internet of Things, the revenue
opportunity may be limited in the near term as these devices may not
connect to existing carrier networks or will use very limited capacity if
they do -- *Simon Flannery believes tower companies are perhaps the most
obvious potential beneficiaries of the IoT*, as new devices and
applications should only accelerate the need for broader and deeper
wireless coverage to support the millions of new devices coming on line.


*Let me know if you'd like to request a call with any of the analysts
involved, or get a glossy hard copy of the report.*


Thomas Wigg

*Morgan Stanley | Institutional Equity Division *1585 Broadway, 5th Floor
| New York, NY 10036
Phone: +1 212 761-8759
Mobile: +1 201 787-5612
Thomas.Wigg@morganstanley.com


------------------------------


[image: cid:923203915@16072008-22CB]

April 3, 2014

*The 'Internet of Things' Is Now**Connecting the Real Economy*


*Download the Blue Paper
<https://ny.matrix.ms.com/eqr/article/webapp/f22c9d50-baa8-11e3-bd9c-a752fc238000?t=1396548982%3A497%3A3501%3Ahz829c3n6&m=1&ch=Outlook%20Blastmail>*


*The Internet of Things is the next revolution in computing.* While
smartphones and the mobile internet saw the advent of applications for the
consumer, we expect to see the pervasive integration of semiconductors,
mobile communication, and Big Data/analytics propelling the Internet of
Things into the wider economy.

*The two key drivers of IoT are:* 1) price reduction and standardization of
key hardware and software components, and 2) the level of integration with
Big Data/Analytics, from which companies in various sectors can increase
revenues and reduce inefficiencies.

*Our polling of Morgan Stanley analysts globally found that the IoT could
be an opportunity for several large industries, driving potential changes
in business models and/or significant cost savings.* The industries with
the greatest potential Internet of Things impact are: Utilities (smart
metering and distribution), Insurance (behavior tracking and biometrics for
Auto and Life product lines), Capital Goods (factory automation, autonomous
mining), Agriculture (yield improvement), Pharma (clinical trial
monitoring), Healthcare (leveraging of human capital and clinical trials),
Medtech (patient monitoring), and Autos (autonomous driving). Key
IoT-exposed companies we cover are Apple, ARM, Atmel, Crown Castle, CSR,
Freescale, Google, Imagination, Intel, Linear Technology, Microchip
Technology, NXP, Realtek, Richtek, Salesforce.com, SAP, Software AG,
Spansion, Splunk, and STMicroelectronics.


*Download the Blue
Paper*<https://ny.matrix.ms.com/eqr/article/webapp/f22c9d50-baa8-11e3-bd9c-a752fc238000?t=1396548982%3A497%3A3501%3Ahz829c3n6&m=1&ch=Outlook%20Blastmail>


*MORGAN STANLEY BLUE PAPER*

[image: cid:923203915@16072008-22D2]<https://ny.matrix.ms.com/eqr/article/webapp/f22c9d50-baa8-11e3-bd9c-a752fc238000?t=1396548982%3A497%3A3501%3Ahz829c3n6&m=1&ch=Outlook%20Blastmail>
*MORGAN STANLEY RESEARCH*
Global

*François Meunier ** <Francois.Meunier@morganstanley.com>

*Adam Wood ** <Adam.Wood@morganstanley.com>

*Keith Weiss ** <Keith.Weiss@morganstanley.com>

*Katy Huberty ** <Kathryn.Huberty@morganstanley.com>

*Simon Flannery ** <Simon.Flannery@morganstanley.com>

*Joseph Moore ** <Joseph.Moore@morganstanley.com>

*Craig Hettenbach ** <Craig.Hettenbach@morganstanley.com>

*Bill Lu ** <Bill.Lu@morganstanley.com>

Morgan Stanley Blue Papers focus on critical investment themes that require
coordinated perspectives across industry sectors, regions, or asset classes.


*Click here for other Blue Papers
<http://researchportal.ms.com/eqr/research/docs/content/ui/main.html>*

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Group<product@morganstanley.com?subject=Feedback%20on%20Morgan%20Stanley%20Blue%20Paper%20Series>


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