Video: The Future of IoT

okay hi I'm chase McGuire editor of data mission and our topic today is the Internet of Things the future of IOT to talk about that i'm joined by Jason Shepherd director of IOT strategy and partnerships at dell how are you doing Jason good how are you doing thanks for having me good and you are there looks like an in sunny Austin correct sunny Austin well it's a little rainy outside but it's like 80 degrees whereas two weeks ago it was 20 all right yeah welcome to Texas there you go so you wrote a pretty neat document it's called five predictions for the init of Internet of Things in 2017 I thought we'd go through that it's basically five bullet points and I think it pretty much sums up where I OT is headed in 2017 point number one you say measuring business impact and ROI and security fears will be the greatest inhibitors of ir g products and solutions in other words businesses aren't sure if it's going to make them any money and they're also concerned about hacking so what's up with that yeah i mean the biggest thing that we're saying i mean this is this is a go to market and a business question before it's even about technology i mean obviously the technologies is key and that's kind of our play here but but lots and lots of solutions looking for problems out there that don't really resonate with with what a business is really really really going to be interested in that's really going to drive impact yes I would love to save energy which is obviously a great use case but does that really motivate me over the 10 other things that I have to do you know that I have to spend money on and in time so unless you really resonate was because of this and this and this and this or you know who you're talking with whether it's the operations group or the the IT group you know just kind of what really resonates with them there's also the potential as you make things more efficient to expose dirty laundry people don't like to highlight that they're they're not efficient you in some cases you have also have to take into those things taking account those things so lots of lots of talk about the potential of course you Bell wouldn't be in if we didn't think that there was incredible potential you think we're we're kind of hitting the start of the real ramp but you really have to consider those things around you know what what motivates people what's the real ROI is it driven by some sort of compelling event versus wouldn't that be nice to have human nature is you tend to put off nice-to-haves right you know so things like hey there is governmental regulation to go solve you know this type of thing like whether it's you know emissions in an oil and gas rig like we're could say carbon monoxide or some sort of continuity of supply for power and another area or etc like where there's regulation you know that drives hang in terms of fines if you don't meet that requirement so we're seeing good uptake and that type of stuff so it's not like I wouldn't it be nice like I want to avoid you your public exposure in fines so you know you make the point to I thought it's interesting that some of the companies in these early days you know don't want to share their results if they've successfully definitely you know I said so it's it's a competitive factor so if there are more use cases out there publicly it might move iot faster George the ROI factor right so you look at you look at smart cities I mean I like the I like smart departments I like to talk about smart departments not smart cities which is kind of nebulous but let me talk about the private privately contracted trash department you know for a city and making them more efficient because it hits the bottom line versus the overall city but on that point is a cities tend to be more altruistic in terms of wanting to advertise what they've done for you know their their population whereas businesses tend to want to keep it to themselves and not especially not highlight hard metrics on the game the private sector rights so getting getting those details from the private sector and being able to say hey this helped for a a customer it's very similar to you so in your context this is what you can expect you having that data is one thing but then also making sure that people are confident enough that they'll get a similar return so they'll take that leap of faith so so we're really focused on you know not only what's that true roi and considering what motivates people but also how do you then take that and bundle it up into we're calling look-alikes we're like hey this really worked for you and now it can work for somebody else but it's a lot of times what you think is the real business value to someone it's not actually what it ends up being you know and what would it mean by the one example you know being you know is you look at okay and we've been using this example a lot lately but seeing some good traction is if I just say that I can save you power on your refrigeration within a grocery store well great you know but the real value by an order of magnitude is the stuff inside of those freezers and so unless you do kind of a project around the supply chain and understanding customer satisfaction with stuff that a that you know that the stuff tasted good and B they didn't get sick because it went out of temperature right or you didn't wipe out an entire amount a wall of stock because those your 20 year old controllers failed on those refrigeration units which could take out your profits for the week it's not it's not longer but that's the real motivator and not you know just those simple energy savings altogether it's great but but you've got to kind of harp on what what really hits the hot buttons with with less customers so we're looking at that kind of stuff you know you know throughout different markets so of course it's about you focused on focus on use cases and whatnot but then double clicking what's what's the the extra you know stuff behind it that drives action essentially you also mentioned you know security being one of the big inhibitors and obviously we set some huge hack attacks in 2016 and of the decision you wrote as the business value and associated attack service grows for IOT so will the interest of attackers there are two throughout 2017 hackers will continue to exploit IOT device for only abilities to launch broad scale attacks you're certainly not whitewashing the the security theories of IOT yeah I mean it's you know security you know I'll qualify some of this is that the DDoS attacks that were widely publicized what you in the fall for what not late last year right the majority of actors or devices on the network that you know participated in those attacks they were had almost no security applied I mean literally I think it was like a combination of something like eight unique credentials could hack into millions and millions of devices right so you got to separate the PR problems versus you know with the people that just kind of deploy stuff you and consumer what we're seeing is that either no securities applied because someone doesn't really treat it seriously or they didn't really know what they were doing and the other reason why is people make it too easy to bypass security measures so you can get instant gratification and setting it up right you're trading off usability for security so got to separate that out but of course it's still very important it's about using best practices layered models of tools based on the need and we're going to see increasing focus from businesses as they invest but you know I see security is something behind the business value if you don't can't solve the business value and see something that least needs for your business you don't have a security problems you're not going to do it right but they do go hand in hand you want to treat you know your security as is paramount from the very beginning and then exactly you know as we start to scratch the surface on really hard for business value then the hackers going to get super interested so we've got to kind of keep it will up every game as well but point number two of those interesting you talked about consolidation of IOT platforms through open source collaborations I was so open to us going to be a big factor and part of that I thought this really interesting that there are over 400 IOT platforms which is confusing to end customers it slows down the process of solution development but really a 400 IOT platforms out there yeah anyone can create one in their garage yeah i think there's 401 now in the past 10 minutes but it's varying degrees of like end-to-end platforms from data ingestion all the way through analytics there's different analytics platforms I mean it's it's kind of a little bit all munge together but you know the fact of the matter is there's hundreds of platforms way too many then you need to solve these problems typical of any new market obviously people pile in I mean there's there's a couple of trends that I could talk about that we've seen and I've been looking at the space for about three years I've been on you know the strategy Adele since the very beginning with a core team that then evolved into our business and we've seen it you mature and everything ramped up and then this will be the year of the extra exit strategy for a number of platforms see the writing on the wall and then right you know the other thing is the bigger players historically up till kind of middle of last year it was kind of this hey we're going to own everything we're going to lock people in we're going to only an end and stack and just tie people in right and then about mid last year you'll give or take is when people realize man this is hard and we don't need to own everything we need to start to consolidate because interoperability and openness is what drives scale that's what our business has always been found on we're all about openness and choice you know that's what you need for this market nobody wins if you write stuff in the vacuum just to get stuff connected and and so I can talk a couple points on that one but I'm yet basically 2016 was the year like digital transformation was a 12-step program last year with step one admitting you're happy and we're stuck but they usually part two is that do you say as a result we will see a leading open source platform project emerged that provides the center of gravity for data integration I guess that's who do you think will lead that open source platform know that well I think we're very much involved some things that that you know you're going to hear about some stuff soon this is there's there's a lot of people that are like hey you know what I don't need to own everything very very interested in driving some of that consolidation I think that we're at the the peak of the platform proliferation maybe maybe not quite at the peak but it's going to start to rapidly drop I see we have 40 three four three platforms now the less yes yeah it might might forget a dip down early next week yes yes so so so I you know it's we've been monitoring very closely we've been very active in incubating these concepts and working with the standards bodies and consortium and what not to to align on hey let's converge where it doesn't matter you know to be different and then let's be as differentiated as we need to be on around that that's where you're making your value add so the point I've make on that so look at consumer I mean consumer we decided you know three years ago we're not going to get a consumer verbatim said hey the winners in consumer will be those who own the content into the household and the flow of consumer goods ie amazon mm-hmm and the reason that works is because in amazon's you know always see i am some was like the biggest presence at CES and they weren't even there because the exit roughly you know right and and and so that was kind of like the new killer app last year around creating a center of gravity and the reason why is because amazon makes money elsewhere and not on that plumbing you know they sell it for a very low cost they make their money on the content I eita rattling consumer goods you know providing that experience created a center of gravity for people to latch on and they can do that because of the they make their money elsewhere in business because of legacy because of you know the need to share data across businesses and be have that trust factor you don't have that content equation or the consumer goods that that's that sort of power play there it only works in open source no single company can own it right and so so that's what we're active in doing is helping to work with other industry leaders and a bunch of our startup partners as well to go drive that effort so we're going to see because of you know admitting we have a problem last year we're going to see a major consolidation efforts happen this year and it will happen in the community so point number three in your five main points of where i OT is going this year point number three is increased focus on use case within verticals and i think it's interesting the in 2017 the market will a deep conversation on use case development within industry verticals it's not just refrigerators and coffee makers anymore it's healthcare finance education what's the case for verticals i mean so verticals we see it you know dell is focused on building you infrastructure for industrial iot solutions between energy segments these are broad verticals then i'll talk some use cases so broad verticals is energy manufacturing and transportation so those broad verticals of course those things like health care and you know government military and BFSI and the like but you know we're looking at those you know obviously because there's roi there but also because there's a there's a large you know component of you know in manufacturing there's a lot of new convergence that can happen between the operations groups and the IT groups and building being able to connect formally isolated silos and bridge them over to data systems like ERP and the like to drive business value through analytics so there's there's there's a big convergence happening there if you've been any conference you've seen the de ven diagram of operations OT and IT converging right and it's happening and depending on who you ask on the other side they all you know they'll say what it's my job but then there's this so kind of like a tension between and we want to go drive that so so a big part for us is our strategies is you offering the broadest iot infrastructure portfolio is to bring that IT credibility to help that o TI t convergence to operations converging with IT so vertically speaking we've been focusing on energy manufacturing and transportation based on a bunch of different data that we've seen we hear it very consistently in other reports that come through after that the analysis that we've done we see it Ewing in you know among our customers and whatnot the reason you know for some of the other markets is what i would call stakeholder complexity so like you know health care obviously very interesting but there's a lot of liability issues there's a lot of stuff when you cross between public and private so so broadly speaking those are the verticals that we're focused on but we're also opportunistically going over after other ones more important is to talk about use cases because a good use case spans all verticals right you know like predictive maintenance is not just for manufacturing that would go into your building equipment it would certainly go into hospitals or any number of things you know smart agriculture or whatnot so we're going to flip you know we've we've flipped kind of a lot more to very much focusing on use cases whether it's predictive maintenance or you automated process control and bridging you know the Operations Group to the ite group transportation and logistics and even some of the double clicks below that the traction that we're seeing you together with our partners is all when it's hyper focused on a use case people that are like hey I can do everything by check out these babies what do you want you mmm you end up doing nothing because it's paralyzing like where do you start right the people are like that are the expert that no more than you ever wanted to know about a given topic they're the ones that are doing stuff is when you solve pain well people call you right and and so so this market goes vertical before it goes horizontal it just so happens that a lot of it tends to be tied to a siloed platform so here's a proprietary platform we're going after this market here's a proprietary platform we're going after this market that's kind of the way it is right now but what you'll see especially as you know prediction to takes hold which is new convergence it'll be applied domain expertise across more of this common interoperable foundation that enables distributed computing and then I put on my problem but my proprietary value add around that and my domain expertise then I go solve problems it's just kind of coming about it a slightly different way because right now it's like you take some of these silos and get focus you no longer term you would like to have more of a horizontal base and then apply vertical to go after the use case and so the the point number four you made up of the top five vendors will focus on certifications to help advance IOT growth than you you point in particular late for example ibm's watson iot academy and ptc university so think work so if privilege it's for those IT job seekers out there that's obviously it's a career opening it's a growing market are you thinking that qualified personnel are holding back the growth of IOT um well I I think platform proliferation is holding you holding it back and once you solve that problem I mean obviously we mentioned to talk about the business use case and some of the security fears but these solutions are complex so step one you address the business case step two is is don't reinvent the wheel you for just core in our ability and once you once you kind of start to drive some subtraction there then certifications have become extremely important because these solutions are so complex right but you know if I got certified in one of four hundred platforms well there's a mean a lot right you know and obviously there's centers of gravity around things like Watson which is which is clearly important working closely with IBM on that like it's it's it's in you know then it things really become more meaningful when you get certified when you've got you know this core foundation for interoperability and that that exposes things that are consistent around how you do the basics of security how you do the basics of system management you have the API is that enable the foundation and then people build their own proprietary systems management tools security tools these are the basics of how you do connectivity more you know more consistently the reason why of course you see in the PC space you see a lot of you know centers of gravity around windows and no iox or you rack right well we're obviously mobile it's it's you know Android and iOS the reason why you you don't see that at the OS level in IOT it's it's it's very difficult because there's so much fragmentation and operating systems in in embedded solutions lots of flavors of Linux lots of you know the flavors of Windows I mean there's people out there that we're still using XP you know if not earlier there's no use until it lazy they die those are some brave people yeah yeah but but so you have the more you can abstract out of the OS and put into a very flexible platform that sits on top of the OS but make that really open the better you know so so so so we're really focused on working with with people there and then if you take you know as because the community is start to evolve around that and current platform companies start to adopt those types of interoperable principles as a broader industry now certifications really mean something so we think that as these trends start to happen the conversion starts to happen then then then the certs come up that also gives customers so in addition just to stabilization the cert start to give customers confidence that these they can trust in these solutions so right so you kind of a sequence point 5 is really my favorite of your of your top 5 artificial intelligence will increasingly be used to mine the data coming from IOT devices Forrester tells us there will be greater than three hundred percent increase in investment and artificial intelligence to 2017 oh over last year's so definitely AI is going to be huge in 2017 it it makes sense that a I would would power internet of things because there's such a deluge of data it's it's far too much for humans to really digest so what is it about AI ni OT well it's taking the complexity out of the interaction you're making it more natural to interact with the physical world tied into this is a bit of AR and VR AR you know we're more bullish on for IOT because it's literally you overlaying the physical you know the data that's collected and analyzed back on top of the physical world where it was collected from right but I mean being able to more naturally interact with a smarter world makes it makes it just much more palatable to to to use when you have you know mobile device obviously the Mobile's not going away mobile devices smartphones and alike but but with if I mistake the home example again if I'm in my house and I have 10 different apps to manage 10 different siloed things inside of my house and I've got it like click click click page page click trip the remote volume on the TV versus hey TV turn to the remote you turn up the volume or I could just as well go pick up my remote control that I've had for 20 years internal volume right now it's in that moment interaction that takes away multiple steps and makes it more of a natural deal that's where AI is really you're going to come in from that interface of course you seen AI and things like a Thomas cars and the like but but but having that kind of killer interface will help you no further adoption or if I'm in the moment a factory and I'm a machine worker I can use a combination of AI and an AR augmented reality to interface with machines while I'm doing maintenance and I could have like an expert in the backend training needs so real time I'm seeing you know data coming from temperature and pressure and this on the other on this this equipment that I have to monitor while I'm doing this sequence and then I'm also being able to interact naturally through speech you know that's that's some of that stuff that's going to take hold that's a big part of thing by way that this the natural language speech enabled by AI think it's going to be a big driver of it right but none of this takes you know mainstream scale until you figure interoperability hence why I went a little practical this year on the predictions yes block chain is interesting that's a little bit out but we're looking at blockchain yes arv are we're very active looking at those topics very active looking at AI and are working with a number of partners that are building out a I solutions it's all super important but you also have to figure out the basics and so you know cutting through the hype on some of that was important for this year mmhmm yeah you know I think you said it that's five great directions I do you care to cast in your crystal ball for maybe the next 12 months several several years what we'll be talking about when were you know in the year 2020 and we're talking about Internet of Things what we'll be talking about if you look that far ahead bravely I think well for starters I don't think we're going to be talking about Internet of Things it's just going to be there's just me business right you know i mean it's do we still talk about e-commerce nobody just buy stuff online it's cool it's called the network right right it's just what you do so so we think that you know I OTS super busy right now hihi value that you just got to make sure that you find it you and exploit the where the real value is and not just wouldn't that be neat but over time I mean it's just it's business i mean it's it's it's more pervasive throughout our lives definitely the killer apps will be out there definitely expanding way way down into a small and medium business if you're looking at the commercial side of things you've especially us things become more interoperable you can package things up and deliver them to more more people you know a lot of stuff happening in developing countries i mean it's it's it's it's very interesting to look at the the needs between you know maybe a you know in the u.s. we see people like I want to eat the last little percentage bit out of the power grid and we talked with customers may be in apj now that's when I power you know it's some sort of dividing country so I you know you're going to see a lot more stuff happening worldwide that drives a lot of change but I just don't think it's going to be you know like the buzzword IOT necessarily right happens to get a lot of hits on the internet right now so you know you want to latch onto it but sure you know it's it's it's just more pervasive more natural interaction you know high value a lot less noise in terms of stuff out there and just you know I don't I think it's just going to be starting to hit real scale Jason I think you said it that's great looking forward to an interesting year ahead of indian it sector thanks for joining us also did a link we can tweet it but I thank you very much for your time today great stuff cool yeah thank you thanks for Emmy take care you two

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