Thought Leaders in Internet of Things: John McDonald, CEO of CloudOne (Part 3)

Sramana Mitra: These platforms that you’ve described so far, besides the customer example that we went over, do each of these platforms have other customers?

John McDonald: In both cases, there are other companies that we’re working with and have been working with to implement an extremely similar kind of environment. For instance, we also work with a competitor of Panasonic in the marketplace and even though they are competitors, both use CloudOne in a very similar way. We’re working with several other customers for which the core issue is the data collection and analytics platform that they need for IoT. Obviously, we draw in the expertise that we have but we don’t share anything that’s proprietary or unique to Cummins with other customers. We definitely know and understand from our experience how to replicate success for other companies too.

Sramana Mitra: How many customers do you have in total? >>>

Thought Leaders in Internet of Things: John McDonald, CEO of CloudOne (Part 2)

Sramana Mitra: Let’s switch to a different platform and a different customer and do the same kind of use case description.

John McDonald: I’ll give you another example of a well-known company. Panasonic has many different businesses but one of their businesses is a unit called Panasonic Automotive Systems that makes car radios or as they call them, infotainment systems. It’s probably the most sophisticated piece of integrated electronics that you’ll find in the modern vehicle. Oftentimes, the amount of code that goes into the radio exceeds the total amount of code in every other element in the car by several times. It’s an extremely intricate and complicated electronic device with a ton of software that’s baked into it during production. Panasonic has been a long-time customer of CloudOne in regards to providing them with the environment that their engineers need to be able to successfully develop and deliver the code that goes into those infotainment systems. They have several people all over the world in several development teams and sometimes, contractors or other vendors that they work with to augment their own people need to collaborate live on a global basis. >>>

Thought Leaders in Internet of Things: John McDonald, CEO of CloudOne (Part 1)

CloudOne focuses on IoT applications as they pertain to the industrial engineering sector, primarily. Based in Indianapolis, in the heart of the manufacturing industry hub of the United States, the company caters to over 50 customers, and in this interview, John shares some examples and trends from the sector.

Sramana Mitra: Let’s start by introducing our audience to yourself as well as to CloudOne.

John McDonald: I’m the CEO of the company called CloudOne, which is based in Indiana. CloudOne was started in early 2010 and I was privileged to be one of the early leaders of the company. I did that after a long career at IBM – almost 20 years – where I led different entrepreneurial projects within the organization, mostly in the software space. I had the opportunity to get to know some of the early founders of CloudOne while I was still at IBM and was privileged to join them in 2010.

Sramana Mitra: What do you do in the company? >>>

Thought Leaders in Internet of Things: David Parker, Global Vice President, SAP (Part 7)

Sramana Mitra: What you mentioned is data in general. That’s not data generated by Internet of Things because they’re not rolling out Internet of Things yet.

David Parker: You’re missing the point. What I’m saying is what’s preventing them from rolling out Internet of Things is the data security because they want to take that Internet of Things device data and align that to business data as well as align it to customer data. What they’re saying is if you, as an organization—SAP or any other third-party vendor of our size—can take ownership of all of that data, then I might be interested in doing an Internet of Things type of deployment.

Sramana Mitra: Got it. They’re making that a prerequisite before they would consider rolling out Internet of Things. I see what you’re saying.

David Parker: Yes. >>>

Thought Leaders in Internet of Things: David Parker, Global Vice President, SAP (Part 6)

Sramana Mitra: Only if you can ensure that it is a secure process. Because if you look at all the breaches that we’ve seen like the Target breach, it’s opening up huge question marks on whether it’s a good idea to expose that much of surface area to security threats.

David Parker: That’s one side of it. That’s if you engage with the end consumers. In the case of IoT for the retailer, obviously a lot of them have inventory management. They still have transportation logistics. They’re more focused on how to optimize that and how they actually have goods just in time as opposed to a stockpile of goods that aren’t easily replenished by sales.

Sramana Mitra: To the extent that the use cases are logistics use cases and IoT is used at the container level, I would say those are probably more penetrated. When it comes to actually turning every single item into a sensor item, I think that adoption is far away.
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Thought Leaders in Internet of Things: David Parker, Global Vice President, SAP (Part 5)

Sramana Mitra: How pervasive would you say is the adoption of Internet of Things? Do you have sensors’ use cases in each of these segments that you brought up? It sounds like manufacturing and industrial automation is one of the early adopters. Is that 100% penetrated? What are we talking here?

David Parker: The irony is that a lot of these industrial firms have had sensors on a lot of their machines for a number of years. They capture the data in batch mode and are not doing much with that data. When a machine fails, I know that it failed because it failed. I don’t need to get a report on it. I would categorize it as much as around 55% of manufacturing firms are already in that state. They’re already connected. They’re already acquiring data but don’t do much with it. The technology now has moved on in terms of capturing it real time and processing it either on the edge or at a core data center, or in the cloud.

As much as 40% of that 55% is now about collectively, in real time, looking at that data and doing some predictive analysis on that data. >>>

Thought Leaders in Internet of Things: David Parker, Global Vice President, SAP (Part 4)

David Parker: Number two is, these industries like manufacturing, CPG, automotive, mining, oil & gas are the primary industries that we’re seeing a lot of traction from our customers across the globe, irrespective of the initiative that’s coming out of Germany. The main reason for that is that they envision that there must be a new commercial revenue opportunity by taking some of the consumer market. What they mean by that is that everybody has some kind of a mobile device. You know the stats.

The executives at these organizations such as Siemens, Honeywell, GE are looking at this market and saying, “How do we capture more consumer share? How can we improve our products and services by enriching the data that we already have with data that we don’t have currently >>>

Thought Leaders in Internet of Things: David Parker, Global Vice President, SAP (Part 3)

Sramana Mitra: I have a specific question on what is the state of the union that you are seeing in your customer base with SAP. Are there large customers who are connecting up through these RFID/sensor devices with huge numbers of assets? If so, then which industry sectors are they in and, if you are authorized to give some names of customers who are going for big deployment, who are they?

I’ll give you the context of where I’m coming from. The main push back that I hear in the industry is, exposing so many assets to network devices means that there are surface areas that are being opened up to cyber security problems and breaches. If you look at retail for instance, if every item has an RFID device, then the surface area that is exposed to cyber threats is much higher. Based on my earlier conversations, there’s actually quite a bit of resistance in large customers to roll out Internet of Things. My question to you is what are you seeing from SAP’s vantage point?
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