by Gary Mintchell | Jun 13, 2018 | News, Organizations, Security
Claroty has been busy. Following the news of investments and partnership with Rockwell Automation, Claroty and Siemens announced a global partnership. Siemens will leverage Claroty’s advanced behavioral analysis technology in Siemens’ recently announced Industrial Anomaly Detection solution.
Siemens, through its global venture firm Next47, also invested in Claroty, joining a global syndicate of industrial giants that invested $60 million in the company’s Series B round, bringing the company’s total investment to date to $93 million.
Siemens initiated the Charter of Trust in February 2018, gaining the support of other giant companies in the global fight against the rising cybersecurity threat to industrial systems. Siemens also continues to expand its cybersecurity portfolio, debuting at the 2018 Hannover Messe industrial automation conference a new Industrial Anomaly Detection solution, which will deliver significant value for both operations and cybersecurity teams. Operations teams receive a detailed inventory of industrial assets and changes to the network. Cybersecurity teams can continuously monitor these critical networks for vulnerabilities, malicious activity, and high-risk changes, across distributed industrial sites.
Claroty was selected by Siemens following an intensive technical evaluation. “In selecting our security partner for Industrial Anomaly Detection, we reviewed the market, conducted a detailed evaluation, and rigorously tested possible technology in our industrial lab environment,” said Dr. Thomas Moser, CEO of the Siemens Customer Services business unit. “Claroty’s advanced behavioral analysis provides a significant advantage to our customers in reducing risk to their OT environment.”
“Our mission is to help our customers secure industrial networks so they can avoid costly operations downtime, and maintain the safety of people and expensive assets,” said Amir Zilberstein, Claroty Co-founder and CEO. “Siemens’ selection of Claroty as a strategic partner and their investment in our company is further validation of our technology, our team, and our ability to deliver world-class, enterprise-level protection.”
Siemens uses Claroty in a pre-packaged offering enabling customers to quickly and safely deploy anomaly detection in their operations. Siemens brings the offering to the market based on pre-installed packages on Siemens IPC. In the future, it is planned to also offer this based on Siemens switches with an Application Processing engine provided by the Ruggedcom RX1500 series.
Siemens, as owner and operator of nearly 300 factories, heavily leverages digitalizing for efficiency gains. Responsible digitalization must go hand in hand with cybersecurity. Therefore, Siemens is implementing a defense-in-depth security concept in its factories. Industrial Anomaly Detection is an important element of this concept.
The Claroty Platform is comprised of multiple integrated products, built on Claroty’s advanced CoreX technology. The products provide the full range of cybersecurity protection, control, detection, and response. Claroty has received multiple industry awards in recent months. It was recently named an Energy Innovation Pioneer at CERAWeek 2018, and the company’s flagship Continuous Threat Detection product won the ICS Detection Challenge during the S4x18 conference in Miami.
by Gary Mintchell | Jun 12, 2018 | News, Organizations
This story is all about partnerships and collaboration. I started to write it yesterday morning, but then I saw a tweet, no not from the “big guy” but from PTC about the Rockwell Automation investment. I wanted to talk about the current trend of partnering.
It begins Roy Kok and DreamReports. We’ve chatted a little about how a company with a somewhat narrowly defined product and market can grow. He’s out in San Diego this week at the Rockwell Automation TechEd event. Rockwell is an important partner. All that data from IoT and analytics isn’t worth the storage if the information can’t be parsed and displayed. Enter Dream Reports. Kok assures me that there will be more partnerships in the future. It’s no doubt his best potential.
Another Rockwell Investment
Meanwhile, I had the opportunity to speak with Patrick McBride the CMO of Claroty about another Rockwell Automation investment. Once again a somewhat narrowly defined market—cyber security—using partnerships to grow. In this case, Claroty attracted $60M of Series B investment, bringing its total funding to $93 Million. He told me that the investment funds will be used to make the appropriate hires to expand sales and projects globally and to support its new partners.
The round was led by Temasek and included Rockwell Automation, Aster Capital (born out of Schneider Electric Ventures), Next47 (Siemens-backed global venture firm), Envision Ventures, and Tekfen Ventures. Original Claroty investors Bessemer Venture Partners, Team8, Innovation Endeavors, and ICV all participated in the round.
Founded in 2014 and exiting stealth mode in late 2016, this investment comes on the heels of a breakout year for Claroty capped by a 300% year-over-year growth in bookings and customer base. Claroty now has large-scale customers with production installations across six continents in nine market segments, including electric utilities, oil and gas, chemical, water, manufacturing, food and beverage, mining, and real estate (building management systems, data centers, warehouses).
“Our unparalleled investor syndicate, which includes some of the most important industrial companies in the world, is a ringing endorsement of Claroty’s technology and the progress our team has made,” said Amir Zilberstein, Claroty Co-founder and CEO. “Our mission is to protect the most critical networks on the planet and our comprehensive platform provides our customers with the capabilities they need to accomplish this vitally important task.”
This rapidly expanding cybersecurity market segment is the result of a “perfect storm” that has placed industrial networks running critical global infrastructures in the spotlight. Old and insecure industrial control networks, which used to be “air-gapped,” are now being rapidly connected to networks and exposed to a range of risks. Because of their criticality, these networks are increasingly targeted by advanced nation-state adversaries who are determined to harvest information and gain a persistent presence for potential future attacks. In 2017, industrial networks also became collateral damage in ransomware attacks like WannaCry and NotPetya costing companies billions in losses.
“A perimeter defense to cybersecurity in today’s connected world is not enough. An end-to-end approach, with solutions that provide deep visibility into operational technology and industrial control systems, is critical for the security of heavy processing environments,” said Hervé Coureil, Chief Digital Officer at Schneider Electric. “Leading the digital transformation of energy management and automation, Schneider Electric takes cybersecurity very seriously and the partnership with Claroty complements the cybersecurity layer of our IoT-enabled EcoStruxure architecture.”
“Protecting the critical automation systems our customers operate against cyberattacks remains a top priority for the company,” said Frank Kulaszewicz, SVP, Architecture & Software at Rockwell Automation. “Claroty has been a partner since 2016 and their advanced technology is a key element of our real-time threat detection and monitoring service. Our investment in Claroty is a logical extension of our ongoing strategic partnership.”
Claroty’s comprehensive cybersecurity platform provides extreme visibility into industrial networks and combines secure remote access with continuous monitoring for threats and vulnerabilities – enabling industrial control system operators to protect these important networks. The company will use investment proceeds to grow the Claroty brand globally, extend its sales and customer support footprint, and continue its rapid pace of product innovation.
T.J. Rylander, Partner at Next47, the Siemens-backed global venture firm said, “The recent increase in scale, scope, and frequency of cyberattacks on critical infrastructure has led to an uptick in demand for new solutions from companies around the world. Claroty has the team, technology, and market traction to deliver the kind of lasting impact that we are looking for at Next47.”
by Gary Mintchell | Jun 11, 2018 | Commentary, News
So I decided not to make a cross country trip to San Diego for Rockwell Automation’s RATechEd event this year. I have cross country trips coming up the next two weeks followed by family time. So, I’m doing a one-day business trip plus taking my wife out for dinner in Chicago this week. Anyway, they had informed me that they wouldn’t be setting up interviews but that I’d be welcome to sit in any sessions I wanted. I passed.
Then I see a tweet from PTC today. Blockbuster news. Rockwell Automation’s Connected Enterprise just became connected. It has invested $1B in PTC for an approximate 8% ownership. PTC has [ERP], PLM, and IIoT (Kepware and ThingWorx). By connecting with these technologies, Rockwell now has the possibility of a technology convergence rivaling its rivals in Europe.
There are three of my questions about Rockwell answered:
- Other than a refreshing change of culture, what else was Blake Moret going to do to put his stamp on the company?
- When was Rockwell Automation going to really connect the enterprise like its slogan has held for several years (about the time I came up with Manufacturing Connection for the new title for my blog)?
- How was Rockwell going to answer the digital manufacturing and Industry 4.0 moves made by its European competitors Siemens, Schneider Electric, and ABB?
This is far from an acquisition and just a partnership right now. But it is a big step in the right direction.
Here is the press release I downloaded from Business Wire.
PTC Inc. and Rockwell Automation, Inc. today announced that they have entered into a definitive agreement for a strategic partnership that is expected to accelerate growth for both companies and enable them to be the partner of choice for customers around the world who want to transform their physical operations with digital technology.
As part of the partnership, Rockwell Automation will make a $1 billion equity investment in PTC, and Rockwell Automation’s Chairman and CEO, Blake Moret, will join PTC’s board of directors effective with the closing of the equity transaction.
The partnership leverages both companies’ resources, technologies, industry expertise, and market presence, and will include technical collaboration across the organizations as well as joint global go-to-market initiatives. In particular, PTC and Rockwell Automation have agreed to align their respective smart factory technologies and combine PTC’s award-winning ThingWorx IoT, Kepware industrial connectivity, and Vuforia augmented reality (AR) platforms with Rockwell Automation’s FactoryTalk MES, FactoryTalk Analytics, and Industrial Automation platforms.
“This strategic alliance will provide the industry with the broadest integrated suite of best-in-class technology, backed by PTC, the leader in IoT and augmented reality, and Rockwell Automation, the leader in industrial automation and information. Our combined customer base will benefit from two world-class organizations that understand their business and deliver comprehensive, innovative, and integrated solutions,” said Jim Heppelmann, President and CEO, PTC. “Leveraging Rockwell Automation’s industry-leading industrial control and software technology, strong brand, and domain expertise with PTC’s award-winning technology enables industrial enterprises to capitalize on the promise of the Industrial IoT. I am incredibly excited about this partnership and the opportunity it provides to fuel our future success.”
Blake Moret, Chairman and CEO, Rockwell Automation, said, “We believe this strategic partnership will enable us to accelerate growth by building on both companies’ records of innovation to extend the value of the Connected Enterprise and deepen our customer relationships. As IT and OT converge, there is a natural alignment between our companies. Together, we will offer the most comprehensive and flexible IoT offering in the industrial space. Our equity investment in PTC reflects our confidence in the partnership and the significant upside we expect it to create for both companies as we work together to profitably grow subscription revenue.”
Rockwell Automation’s solutions business will be a preferred delivery and implementation provider, supported by a robust ecosystem of partners that both companies have established. The strength of both companies across geographies, end markets, and applications is complementary.
Terms
Under the terms of the agreement relating to the equity investment, Rockwell Automation will make a $1 billion equity investment in PTC by acquiring 10,582,010 newly issued shares at a price of $94.50, representing an approximate 8.4% ownership interest in PTC based on PTC’s current outstanding shares pro forma for the share issuance to Rockwell Automation. The price per share represents an 8.6% premium to PTC’s closing stock price on June 8, 2018, the last trading day prior to today’s announcement. Rockwell Automation intends to fund the investment through a combination of cash on hand and commercial paper borrowings. Rockwell Automation will account for its ownership interest in PTC as an Available for Sale security, reported at fair value.
by Gary Mintchell | Jun 7, 2018 | Commentary, News
The 2018 EY Industrial Products Survey was conducted among 500 Industrial Products (IP) executives whose businesses yield over $1B in annual revenue. These surveys are coming in with similar results. You can look at the results and say “Wow, almost half of executives at these companies see innovation as important, or see technology as important” or “How can half of all executives surveyed not see how important innovation is”.
I’ve had experience in manufacturing and marketing leadership and have studied it for many more years—and I lay most of the problems with manufacturing business squarely with (lack of) managerial leadership. I see these results and think that there will be many winners and just as many losers in the coming years.
The study surveyed executives from a variety of sectors including, aerospace and defense, industrial and mechanical components, machinery and electrical systems, chemicals and base materials, packaging and paper and wood. The survey was conducted between February 22, 2018 and March 22, 2018. The purpose of the study was to evaluate where IP companies fall on their journey towards continuous innovation.
Move over R&D: IP companies see digital technology and innovation as their path to success
- 48% Percentage of respondents who view innovation as quite/extremely important for company success
- 43% Percentage of businesses who are learning from and/or following the technology industry to influence innovation at their company
- 67% Percentage of companies who plan to make significant levels of investment in innovation past traditional R&D over the next three years
- 52% Percentage of businesses that say the adoption of emerging technologies will be quite important or critical to the success of their business in the next three years
Additional results from the survey include:
Facing a culture crisis: The perception of the IP industry is hindering the talent search
- 67% agree/strongly agree that the image of the industrial products industry hurts when recruiting for needed skills
- 38% that difficulty competing with tech-first companies for top talent is a leading barrier in filling the skills gap
- 25% say that attracting/retaining top talent is one of the biggest drivers of their company’s technology investment
- 64% agree/strongly agree that the IP industry needs to change their culture to thrive
IP is looking for outside inspiration. While the tech industry is the leading source, IP has a ways to go
- 43% of respondents are learning from and/or following the technology industry to influence innovation at their company
- Only 29% of business say they are extremely or quite innovative compared to close competitors
- 82% of respondents have made minimal or no investment in AI today
- 22% are learning from and/or following the automotive industry to influence innovation at their own company
- 21% are learning from and/or following the consumer products industry to influence innovation at their own company
Robotics, mobile and big data, oh my! What is getting the largest share of investment attention?
- 63% of respondents say that technology investments have driven measureable returns in agility to a significant/meaningful extent
- 46% are making substantial or major investments in robotics and 56% predict they will in the next three years
- 31% of businesses are increasing investment in emerging technologies in response to US tax reform
- 31% says that big data/analytics will be most influential on their business over the next three years
Not a matter of if but when disruption will hit. IP companies are staying nimble in order to prepare
- 49% of businesses say that preparation for disruption will be quite important or critical to the success of their business in the next three years
- 52% of businesses say that flexibility to adapt to trends will be quite important or critical to the success of their business in the next three years
- 53% of businesses say that access to specialized skills for emerging tech will be quite important or critical to the success of their business in the next three years
by Gary Mintchell | Jun 6, 2018 | Asset Performance Management, Data Management, Internet of Things
Have you been wondering about GE Digital and such products as Predix Asset Performance Management since the announcements of the new GE CEO reducing the group and throwing it into turmoil?
Well, just when I realized I had not heard anything for a while, this press release appeared. I don’t usually write about the announcements that come daily about sales “wins” or about success stories. But I felt this was significant in that it was news that GE Digital is still out there and that here is a user that is not a GE company. Also it reflects a trend of collaboration among companies. Plus another trend—one of the original hopes for the Industrial Internet of Things, that is, adding ability for OEMs to monitor their equipment at the customer’s site and provide service and support.
Here, GE Digital and SIG, a leading provider of packaging systems and solutions for the food and beverage industry, announced a strategic partnership to power digital innovation in food and beverage packaging.
SIG will deploy GE Digital’s PredixAsset Performance Management (APM) and Predix ServiceMax industrial applications across more than 400 customer factories worldwide to drive new levels of efficiency, create intelligent solutions and enable new possibilities for its customers.
The food and beverage industry is ripe for digital transformation, with consumers increasingly seeking innovative, convenient products that are not only safe and sustainable but also affordable and differentiated. At the same time, producers are facing competitive pressures, supply chain complexities and ever-shorter production cycles – creating an increased need for technologies that can enable producers to quickly identify, predict and act on changing consumer and market demands.
The unique combination of GE Digital’s APM and ServiceMax applications will enable SIG to build an end-to-end digital platform that will bring a new level of insight and data-driven intelligence to its customers worldwide – helping them and SIG transform how they predict, manage and service the entire lifecycle of SIG filling lines. By automatically collecting and analyzing asset data – tapping into billions of data points across its operations globally in real time – SIG and their customers can move beyond traditional asset monitoring and predictive service models to reimagine their supply chain, enhance quality control technologies and evolve their portfolio mix.
“Our ability to harness data is central to delivering on our promise of opening up new opportunities for our customers,” said Rolf Stangl, SIG, CEO. “By tapping into information in new and innovative ways, we will be able to deliver an unmatched level of performance, security, transparency and creativity across the entire food and beverage supply chain – through to the end consumer.”
SIG’s customers fill more than 10,000 unique products into SIG packaging across 65 countries worldwide. In 2017 alone, SIG produced 33.6 billion carton packs for its customers. Through this large-scale partnership, SIG and GE Digital will co-innovate packaging solutions and technologies to address the industry’s two biggest needs today: improving asset performance and optimizing service delivery.
The new digital service model will also enable SIG to deliver new solutions and business models based on advanced performance metrics, including as-a-service delivery, performance-based and subscription solutions.
The initial deployment is expected to go live in July 2018 with the global rollout anticipated to begin in January 2019.
