There is a lot happening in the field of Internet of Things (IoT), one of the technologies expected to trend in 2017 and beyond.
Daniel Callahan, analyst at TBR, has revealed the latest IoT developments in November 2016.
IBM bringing Watson to the market and bolstering its security stance
IBM is positioning Watson as a product in the increasingly competitive artificial intelligence (AI) market, as AI is critical to enabling IoT analytics and creating insight.
Additionally, in IBM preps for customers’ ‘right-of-boom’ cyberattack response requirements, TBR Principal Analyst Jane Wright highlights IBM’s activity in the security space, including its new X-Force Command Center, to secure enterprise IT and meet the demands of evolving security threats.
Security remains at the forefront of customer concerns when adopting an IoT strategy. A vendor that can display comprehensive security solutions, services and preparedness will have an advantage in the vendor consideration stage — especially among customers with extremely sensitive data in healthcare, financial and insurance.
GE goes all in with Predix, aiming to be the ‘app store’ for IoT in the industry verticals
GE is increasingly heightening the importance of Predix to its overall business and is making acquisitions, such as ServiceMax, and expanding partnerships, such as with PTC and Hewlett Packard Enterprise (HPE), to ensure its position as a dominant player in the IoT-operational technology (OT) space.
To date, GE has spent nearly $2 billion in acquisitions to enhance Predix and continues to foster relationships with IT consultancies, such as Accenture and TCS, and IT companies, such as Microsoft and HPE, that directly require OT expertise to satisfy customer demand for specialized vertical use cases.
To overcome customer hesitation due to complexity of IoT and inability to discern ROI, GE Digital seeks to make adoption of IoT to a customer’s business as easy as selecting an application from an app store. These applications, made for the Predix system, will demonstrate immediate savings or efficiencies, which customers can then expand on. GE will continue to invest heavily in developer training, acquisitions and AI development, sowing a robust application set and platform for numerous customers with diverse use-case requirements.
Dell and HPE: Same end goal, different routes to success
Both Dell and HPE seek to capture the revenue and profit from ICT infrastructure necessary for IoT deployments. However, aside from the desire to provide critical hardware in IoT deployments, the companies’ strategies differ.
As TBR Principal Analyst Ezra Gottheil explains in his Dell EMC World 2016 event perspective, a consistent message by Dell EMC is the company is satisfied being an ICT provider and will generally exclude itself from most business consulting, application software and far-from-the-box service opportunities.
HPE also seeks to provide all edge computing needs. In December HPE announced its Model 23 and 42 2N Micro data centers, which seek to provide on-premises cloud capabilities. This development, along with its other ICT infrastructure including routers and gateways, allows HPE to provide customers and partners with all the hardware at the edge.
However, unlike Dell, HPE highlighted its expanded objectives in its Micro data center announcement: “(A) trusted partner who can deliver the full breadth of mobility, infrastructure, and services …” HPE highlighted it will deliver business consulting, implementation services, managed services and security services, indicating the company is not ready to forfeit the higher-margin services that Dell would push to partners. HPE, with the help of ISV partners for OT, can plan, deploy and manage a customer’s entire solution under one roof, providing customers with full service from a single vendor.
TBR believes HPE seeks to provide entire IoT solutions with its on-premises data centers to meet customers’ edge needs. If a customer needs centralized computing, TBR believes HPE has relationships with Amazon Web Services (AWS), Microsoft and Google based on customer preference.
It’s difficult to say which company has the winning strategy, especially in the fast-growing but tumultuous commercial IoT market. Dell EMC’s strategy has merit — an immense number of companies are getting into IoT with varied specialties, and trying to be the master of all in software and services can lead to a muddled strategy.
Dell EMC will focus on being best in class in its goal of ICT provision, fostering a wide partner network. If a customer has a unique need, Dell EMC will introduce a specialized IoT solution/vertical vendor in its growing partner network. However, if HPE is truly able to deliver everything, or at least provide the illusion of completeness to its customers, it will also present an attractive proposition to customers: one vendor to speak to. In general, IoT is difficult for customers to understand. A vendor that can reduce the complexity of building, orchestrating and managing IoT will be attractive to customers seeking a more simple hands-off approach.
Bosch in the U.S.: A €400 million investment
Less than two weeks after announcing its €1.2 billion investment in Asia Pacific, Bosch announced on November 14 a €400 million investment in the U.S. by the end of 2016. Bosch’s investment in the U.S. will lead to an increase in headcount — from 17,800 employees in 3Q16 to 18,800 by 1Q17. Bosch noted the investments stem from confidence in the adoption of IoT in the U.S. and strong potential in manufacturing and smart cities for its products.
This investment aligns with Bosch’s other investments in the region, including its 2015 acquisition of Climatec, an energy efficiency, building automation and security firm, and Skyline Automation (acquired by now-subsidiary Climatec), which provides systems integration for building automation. Bosch highlighted a smart city win in the U.S. with its partner FivePoint for smart city applications in San Francisco.
While the €400 million investment is coming at the tail end of 2016, Bosch has already been very active in the U.S. market. The company employs nearly 2,300 researchers in the U.S. and has a Research and Technology Center in Palo Alto, which is focused on web technologies, automated driving and robotics, and sourcing leading talent from partnerships with U.S. universities. Bosch notes its R&D efforts in the U.S. allow it to keep close to the pulse of Silicon Valley’s startup culture, in which there is a significant focus on advanced AI and robotics.
Aside from acquisitions and R&D-focused activities, Bosch’s U.S. investment will center on augmenting its manufacturing facilities in the country with additional IoT capabilities. For example, the company noted its Charleston, S.C., plant, which focuses on automotive equipment, will be expanded and have training programs related to IoT enablement; its Pittsburgh engineering center will be refocused on developing internet and security technologies for IoT; and its Plymouth, Mich., facility, which focused on mobility, automotive electronics and safety systems, will be expanded. Bosch has invested $1.5 billion in the U.S over the past five years.
Bosch is a critical player in its primary verticals, including automotive and manufacturing. Bosch’s position in these verticals is supported by the company’s facility investments, two of which are automotive focused, and its R&D spending on driverless technology and robotics. Bosch will have trouble building outside its traditional verticals.
However, Bosch may challenge that viewpoint through its goal to capture Silicon Valley talent and acquire startups to expand its expertise. Regardless of its ability to break out of its primary verticals, I believe Bosch will be one of the primary global OT partners for IT companies breaking into the industrial verticals.
