training our team hi I'm chase McGuire and our topic today is the Internet of Things the IOT market clearly a booming market to talk about that i'm joined by a major thought leader in the field with me is Nigel Upton worldwide director and general manager of you of the universal IOT platform at HPE are you doing Nigel thank you very well how about you thank you for inviting me good good good i know you are you're there in arizona today correct i am it's beautiful weather oh nice okay it's rainy here in california but we actually need the water so i'm not gonna complain too much about it yeah my biggest concern is whether to wear sunscreen later on today or not ok guys so the IOT market i mean i read all the reports from the research companies and they all forecast you know spend levels and IOT going out to the year 2020 and beyond and the numbers they're always humongous they do go up up up Saul right you know you're close to the market i guess i'd asked you you know where is the market really today is it vaporware is that real is it emerging it is it established well how would you describe the current Internet of Things market so the current Internet of Things market is growing shall I say and you're right if you read the amorous reports and we talk about billions or trillions of devices and dollars what is happening is that the digitization of everything is continuing and that we're putting sensors on everything and that's rapidly continuing as well but it tends to happen at different paces in different regions and in different vertical markets so while i OT will be probably our biggest trend that will affect all of us over the next 10 years because of the sewer that that bad bag ok i will affect our lives of citizens it'll affect the way we drive it'll affect the way we consume energy how we consume food it will affect every aspect of our life i believe and it's this whole principle that you can digitize so many aspects of our life but as i said it happens at different paces in and it's different region to region and you know industry to industry so if you consider a a energy company like shell who have oil rigs the other way that I OT is implement there is very different to how you and I is a consumer would use IOT services perhaps provided by a local a local telecom operator mm-hmm can you can you give some real real world examples of IOT how it's really happening out in out in the world today yeah we yeah we have a very strong relationship with a company called Tata and they're a huge conglomerate they own and a cars like Jagger a Range Rover Land Rover ramming Tata Steel ish absolutely enormous so we've we've partnered with them row they have a very interesting project in India where they're rolling out a massive network starting aiming at 400 million people that's more than the population of the United States and they're rolling this out as a low-power wide area network specifically for devices that um that don't have long battery lives so these are devices that might be a device you hold in your hand or your person use to show where you are and in India women's safety is a very big concern so there's a panic button embedded it in the device and if you feel threatened then you press the panic button and when it goes to the police it well it at the moment it goes to a private security firm that guaranteed to have a response within 10 minutes and that can really reduce a huge amount of problems amount of damage I mean and it it's just a very young it's a very personal example of how I OT can affect all of our lives as citizens and hopefully make the world a better place yeah the same sort of use cases are being applied in smart cities where for most cities their energy bills are a big part of their budget and being able to put in smart street lighting where you can reduce the amount of light you know from a hundred percent luminosity down to say fifty percent or thirty percent you can dial that that the brightness down depending on the time of day a depending on the activity around it so you know emotion driven and that can have an impact of up to a seventy percent reduction in energy bills just for lighting cuz street lights use a lot of energy believe it or not right well there are and you know all evening image in the morning sure yeah yeah uh it's just terms of the market I mean I would if there was a clear leader in the iot markets like there is saying cloud I mean it's everyone accepts amazon web services as the leader it might not be the leader of few years now it might not be the best vendor for all cloud customers but it is generally accepted AWS as the leader so easter up is there a de facto leader in the audi market these days i don't believe there's a de facto leader i mean everybody is in this space because it is so big you see the very big technology companies really investing deeply so hewlett-packard enterprises one of those companies but if you look at how I OT evolves we look at it from three levels one is it a sensor level now when you think about census the type of devices that are being put on industrial plants or being given as a personal security device innovation there is happening like crazy and that doesn't tend to happen with large companies these are this small startups and there they've got great ideas and I know there that they can do very rapid prototyping and so there's massive innovation on the device level but then as you go back into a platform that's where it becomes more and more complex because you got more more different you know protocols you got scale to consider how do you scale out to billions and that's where it requires more and more heavy lifting so today there are probably around three four hundred IOT platforms I suspect that will go down to you know ten to twenty know within the next year or so because it is complicated requires some quite deep pockets to invest in there but that fragmentation seems like it would be a huge you know slow down and talk about that that many that many had dozens and hundreds of platforms it's it can't grow without some consolidation yeah exactly that was our view as well but we also thought that following standards might be a good idea as well because that'll help in the interoperability and they'll give customers more confidence that they're investing in something that standards-based that if they don't like one min know they could switch it out for another so and I've just for the Hewlett Packard enterprise side for our platform we selected the one m2m standard which is driven by about eight standards bodies and that's the standard for the data model that we chose so I think you'll see a consolidation as standards become more mature so that standardization will happen just to make everything easier to integrate it seems like that the our teeth market faces that at least a couple of uphill battles 1 is is security and I think about many of the devices that easily hacked I mean it is a widespread networks if it's going to be hackable by demand who does the network and the other issue is storage I mean we already we're only so weighed down by trying to store everything we have a gross the IOT you know that network created an additional ocean of information security and storage are they the slowdowns that I think they're going to be security is number one issue in any IOT deployment from all the research we do and all the other research that we read it's strange you know so for example we make an IOT platform and we secure the data we secure the the transmission of data from our platform to analytics and to the end user but you find that it's the complete end-to-end that very few people are taking complete accountability for so you as a consumer might buy a security device and then you'll buy your network from somebody else and then you'll buy your platform somebody else there's nobody taking the end-to-end accountability so right a lot of our customers are asking for somebody to step up there I mean HP is one of the companies that can do that but they also tend to start doing independent security testing and audits so a lot of our big customers they will hire an outside company that is you know completely independent to come in and do a security order the testing it's probably a good idea because I mean if you asked IBM to roll out a solution and then asked IBM to security test it it's a bit like asking the Fox to guard the henhouse so you know you two need some independence on this and that's why I think there's a very market they might they might use a slightly different analogy there but I'm just guessing probably accurate yeah yeah so uh got good on the data side we see this phenomena of more and more data staying on the edge and you don't have to send all the data back to the cloud you think of things like video surveillance and video is so data and storage intensive but this is part of the reason why you're seeing more and more companies provide more and more storage and compute power at the edge to be able to make sure that only the metadata is going up into the cloud so for storage particularly the intensive storage like video that will be kept for a while at the edge but the anomalies will go on up to the cloud so that a concept of more and more compute power at the edge and it was a really fundamental principle of how I OT will grow with us it's fascinating the the idea of the Internet of Things and the cloud and relationship between the two I mean it there's of course the the venture capitalist peter Levine ease of a general partner at Andreessen Horowitz and he he said something recently like you know oh I you know edge computing otherwise known as IOT is going to kill the cloud because all the computer is going to be done at the edge where you know that the central cloud repositories are going to fade away because they won't be needed for processing what do you see is the relationship between IOT in the cloud and dis his remarks make any sense at some level that makes sense because the the revolution of this edge compute is really only just starting so that's going to have a major impact however it's not all gonna be in one and it's not all going to be in the other as always it's a balance so you will see an acceleration of edge based compute and these converged edge systems are absolutely critical for that and that that will be a big growth area however the clouds not going to go away anytime soon because you need edge computing but for certain use cases and you need sour based computing so if you think about how can see use IOT there's no edge involved it goes directly from the device into the cloud over a minnow a network it could be a cellular network or a lawyer network whatever it happens to be so it's as we would say in England it's horses for courses for industrial it is edge is going to be a big difference there and it's very very important during an OHP is investing heavily in the edge line converged IT systems however for non-industrial and this is more enterprise and consumer many of the cloud will continue to be a huge repository but there's one other angle which is if you're looking more and more deep learning where you need a lot of computational horsepower to do very deep number crunching that capacity only really sits in the cloud today right you would need massive computational processing power at the edge to be able to do what those deep learning engines do and I think that is a long way off yeah I mean I can see a day in the distant future where that kind of machine learning would be capable at the edge but as you say that is that is a ways off to be sure yeah tell me know we often look at things like connected cars and you know connected cars or planes or trains or whatever they happen to be they're producing tons of data and a lot of the stuff sits at the edge because it doesn't need to go anywhere because you don't need to know whether they I know car is continuing to run as normal and I when producing gigabytes and potentially petabytes of data you just need to know when something starts to go wrong and that's the data that gets sent up and that's the actionable data well the rest of stuff can be stored locally and once you're past a certain amount of day you don't need that data anymore so you drop it what about the future of IOT I would even go you know ten years out but between said you know now and you know the year twenty twenty or so what would it we're going to be the key thrusts of the future of IOT going forward it is there any way the business is going to be prepared for that now the big thrust that I see a primarily driven by economics and if you look at the industrial side it's much easier to justify rolling out IOT platforms for things like preventive maintenance and all condition monitoring because if you can stop one machine from breaking down and stopping your plant going offline for three or four hours that's with millions so there is the the ROI is very very good on things like condition monitoring and predictive maintenance so that will continue to accelerate on the consumer side and the enterprise side the price points are continuing to drop but at the moment price points really limit the mass adoption so you think about putting a tracker on your dog how much are you prepared to pay a month for that sort of connectivity and that sort of tracker if somebody's asking me for a hundred bucks for the device in ten bucks a month to track my dog I don't think so however giving comes down to less than a dollar a month and that includes the device that is just two provisions at as a service yeah I'd do that you know so I think it's some those price points are continuing to drop and it's funny the price points are quite different in different regions so in India for the security device I was talking about for women's women's security where they have a panic button on the price points there are coming and now down to the mid to high twenty dollars whereas if you look at the sipping device in someone like Mexico it might be 50 55 and if you look at the u.s. it's 175 80 so the different Road dropping prices and different types of networks are dropping the network costs to less than a dollar a month so it's the price you talk about is for the well there's the monthly favorite then there's the upfront one-time price and electronics right correct so that price the electronics is 75 us maybe 50 55 someone like Mexico and you know mid-run 20 somewhere somewhere like India was continuing to see that sort of price drop that so that connectivity charge is still too high in many regions but again this is why we work with companies like Tata because do you think the scale you can get the price point down to less than a buck a month mm-hmm it seems like the device market is a possibly lucrative market for an importer who wants to import devices you know build someplace else or do you think it wouldn't cross that works like that oh you can build these devices anywhere it all depends on the type of radio that's inside it whether it's for a 2g 3G 4G or whether it's Laura or Wi-Fi so you know it can be produced anywhere I'm sorry the weather the future I just I think having interrupted you in the middle of the future of you have you of your future talk about I okay yeah the only other thread I'd like to drive is that because I IOT is becoming so pervasive it's entering the manufacturing process and by that I mean when you buy a high-end bike it will now have an IOT device built into the frame so that you can track your bike same with things like backpacks now so the ID or weapons and being able to put tracking devices that are built in to say their stock of a handgun so that it really is trackable and you can't turn it off you know the same when you buy cars you pay for service like LoJack well I know it's it's going to happen very rapidly that everything will be trackable because everything will have an IOT device embedded into the manufacturing process so it won't look like they're sort of clunky things you get today where you buy a separate device and grow tie it onto something it'll be embedded into the product and I think that will also drive that mass adoption with price points that are low enough and you know cheap connectivity well all those devices trekking all those things that can only imagine the data that creates I mean I see an exponential move up i think data storage will always be a good market to be at i agree our great data storage will always be a good market both of the edge and in the cloud yeah nigel i think you said it that's a lot of good stuff i greatly appreciate you sharing your expertise with us today I'll send it a link when were when we're done we can all tweet about it okay thank you very much oh it's a pleasure thank you
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