Software Investments—Looking Beyond the Surface

Software Investments—Looking Beyond the Surface

Rockwell Automation through Blake Moret, chairman and CEO, invested $1 billion in PTC with Moret gaining a seat on the board. The public reason was really to get early information about ThinkWorx, the IIoT product.

The investment valued PTC, a company with $1 billion in sales, at approximately $17 billion. On the surface, we all pondered why.

Speeding up the time, I was able to spend a couple of hours with several people from PTC at last week’s Automation Fair event. This really opened my eyes to the depth and breadth of the ThingWorx offering. There is much technology and usefulness under the hood. This is powerful software.

Now, I understand. Beyond a relationship and most likely some preferential access to ThingWorx and other PTC technologies, I’m surmising that Rockwell Automation can also drop some visualization projects, cut development costs, and utilize the full value of the PTC software. That alone would be a good return on the investment.

Therefore, the most prominent branding at Automation Fair–Powered by PTC.

Revealing more of Rockwell’s piece-at-a-time partnering strategy, it is not using PTC’s CAD and PLM offerings for its digital twin development, but instead it is partnering with ANSYS.

Like I noted in my initial report on Automation Fair, partnering was the centerpiece of news from the event. Looks like it is also the centerpiece of product development. That is most likely financially prudent.

Software Investments—Looking Beyond the Surface

Project Alvarium from Linux Foundation for Trusted Data

The IoT group that I’ve been working with for the past few years has been absorbed into the OEM group which is carrying on an expanded function. This blog post from Steve Todd, Dell Technologies Fellow, details the development of data confidence work that has been contributed to the open source Linux Foundation to seed Project Alvarium.

Following is a quick summary. Go to the blog for additional information about trusted data work.

A team of Dell Technologies specialists finished building the first-ever Data Confidence Fabric (DCF for short). The prototype code will be contributed to the Linux Foundation to seed Project Alvarium.

For several years, the CTO of the Dell Technologies Edge and IoT business unit has been touting a vision of data monetization. However, it’s hard to monetize untrusted Edge and IoT data. As he likes to say, “It’s midnight. Do you know where your data has been?” 

Enterprise storage systems have delivered trusted data to applications for a long time. We started our initial investigation wondering if these same trust principles could be applied to Edge and IoT ecosystems. Recent developments in data valuationdistributed ledgers, and data marketplaces facilitated everything coming together.

Five Levels of Trust

We started with the EdgeX Foundry chair of the Core Working Group, Trevor Conn. Trevor wrote the first-ever Data Confidence Fabric software using Go Lang, the same programming language EdgeX is written in. His Data Confidence Fabric software registered with EdgeX as a client and began processing simulated device data. The initial confidence score for this data was “0” (no trust was inserted). 

Dell Technologies then hired three computer science interns from Texas A&M to deploy EdgeX and the Data Confidence Fabric software on a Dell Gateway 3000 with a Trusted Platform Module (TPM) chip.

EdgeX was then adjusted to support N-S-E-W authentication by using VMware’s open-source Lightwave technology.

Dell Boomi software was invoked by the Data Confidence Fabric software to gather provenance and appended this metadata to the sensor reading.

The Data Confidence Fabric software then stored the data locally using IPFS (an immutable, open-source storage system). This fourth level of trust insertion gives an application confidence that the data/provenance has not been tampered with. It also has the additional benefit of enabling analytics to access data closer to the source.

The Data Confidence Fabric software then registered the data into VMware’s blockchain (based on the open-sourceProject Concord consensus algorithm). 

Software Investments—Looking Beyond the Surface

LF Edge New Projects, Members Collaborate at Open Source Edge

The Linux Foundation and its LF Edge project continues to gain momentum. Here are two new open source announcements.

In short:

  • “Baetyl” and “Fledge” join LF Edge ranks as newest projects, expands LF Edge’s reach across geographies and industries
  • IOTA Foundation, SAIC Foundation (TESRA), Thunder Software, and Zenlayercommit to innovating at the open source edge by joining as members
  • LF Edge helps open source move to commercialization with Akraino RI, EdgeX Foundry Edinburgh release and Open Glossary of Edge Computing v2.0

LF Edge, an umbrella organization within the Linux Foundation that aims to establish an open, interoperable framework for edge computing independent of hardware, silicon, cloud, or operating system, announced addition of two new projects and four new members.

Baetyl, an existing project contributed by Baidu and previously known as “OpenEdge,” extends cloud computing, data and services seamlessly to edge devices. Fledge, an existing project contributed by Dianomic and previously known as “Fog Lamp,”  is an open source framework and community for the industrial edge focused on critical operations. Baetyl and Fledge join the organization’s founding projects: Akraino Edge Stack, EdgeX Foundry, Home Edge, Open Glossary of Edge Computing, and Project EVE. Concurrently,  IOTA Foundation, SAIC Foundation (TESRA), Thunder Software, and Zenlayer join as General members.

“It’s incredible to witness such strong industry support for collaborative innovation to create an open source framework at the edge,” said Arpit Joshipura, general manager, Networking, Automation, Edge & IoT, the Linux Foundation. “In just nine months, LF Edge has seen tremendous growth across the board. We couldn’t be more pleased to welcome our newest members and projects.  Added expertise in industrial edge, manufacturing, energy, and more brings the community and ecosystem closer to a more comprehensive edge stack, delivering shared innovation across technology sectors at the edge.”

Launched in January of this year, LF Edge’s seven projects support emerging edge applications across areas such as non-traditional video and connected things that require lower latency, and  faster processing and mobility. By forming a software stack that brings the best of cloud, enterprise and telecom, LF Edge helps to unify a fragmented edge market around a common, open vision for the future of the industry.

About the Newest Projects

Previously known as “OpenEdge” and initiated by Baidu, Baetyl is China’s first open source edge computing platform and is now part of the LF Edge umbrella of projects. It  seamlessly extends cloud computing, data and services to edge devices, enabling developers to build light, secure and scalable edge applications. The result is stronger processing power delivered to edge devices like smart home appliances, wearables and other IoT devices.  Baetyl joins LF Edge as a Stage 1 project.

“In the era of 5G and IoT, edge computing will have tremendous opportunities to play a role in all fields and industries,” said Watson Yin, Vice President of Baidu and the General Manager of the Intelligent Cloud business group. “As a founding member of LF Edge, Baidu Intelligent Cloud decided to donate Baetyl, the intelligent edge computing framework, to the community, hoping to reciprocate the open-source community while continuously contributing cutting-edge technologies to the global technology ecosystem.  The leading edge-computing technology and framework will further accelerate the implementation of cloud + AI in a wider range of industries with a bigger scale and lead the global AI industry into a new chapter of industrialized production.”

Fledge is an open source framework and community for the industrial edge focused on critical operations, predictive maintenance, situational awareness and safety. Contributed by Dianomic and formerly known as “FogLAMP,” Fledge is architected to integrate IIoT, sensors and modern machines all sharing a common set of administration and application APIs with industrial “brown field” systems and the cloud. Fledge developers build smarter, better, cheaper industrial manufacturing solutions  to accelerate Industrial 4.0 adoption. Fledge joins as a Stage 1 project.

Fledge works closely with both Project EVE and Akraino. Project EVE provides system and orchestration services and a container runtime for Fledge applications and services. Fledge’s verticals (manufacturing, energy, etc.) are starting to roll out 5G and private LTE networks; using Akraino blueprints, Fledge applications and services can be consistently managed as they utilize 5G and private LTE networks.

“The LF Edge’s efforts for an open, interoperable framework for the edge is especially needed for the industrial factory, plant and mine where most every brown field system, piece of equipment or sensor uses its own proprietary protocols and data definitions,”  said Tom Arthur, CEO and co-founder of Dianomic Systems. “Fledge was architected and built with the help of suppliers and operators in energy, oil and gas, manufacturing, mining, food processing and pharmaceutical industries.  Being designed specifically for the industrial edge, Fledge is the ideal LF Edge framework for industrial operators, system integrators and equipment providers to embed, deploy, contribute and build a thriving industrial open source community.”

“OSIsoft has been building software to break down the silos in industrial systems but with IoT these silos are multiplying to smart equipment, new sensors, and many other sources of data. We have supported the construction of Fledge by Dianomic Systems.  Fledge is an open source tool that presents these data to the outside world and look forward to vastly increasing the scope of data that we can all ‘see.’ This is integral to the fields of automation, energy conservation, safety and health,” said Pat Kennedy, Founder and CEO OSIsoft.

Software Investments—Looking Beyond the Surface

AVEVA World Conference All About Digital

I’m at the airport with my brain shot from all the (non-digital) information I picked up during the past two days of the AVEVA World conference in Orlando.

To be sure, this is the “New” AVEVA. It was formed when the existing engineering and design software company accepted an investment from Schneider Electric whereupon Schneider gained a 51% share and AVEVA gained the Schneider software businesses which included Wonderware, Avantis, InduSoft, and more. These latter companies were buffeted from one corporate brain fart to another for a while.

So, people now ask me, “How’s it going?”

These integrated companies seldom really work out to the extent that corporate PR would have you believe.

In this case, the integration probably exceeded expectations. The conference was well attended and buzzing with energy. I did not meet a customer attendee who wasn’t pleased with the conference and what they were getting out of it. Unlike many conferences, the breakout sessions were packed.

Overall, I am positive that I was seeing the fruition of visions I had heard from a variety of Wonderware executives as well as visionaries like Peter Martin and Chris Lyden from Foxboro (once a part of Invensys and combined–sort of–with Wonderware).

When my brain can wrap around all that I learned, I’ll post many details of the various parts–Engineering, Monitoring and Control, Planning and Operations, and Asset Performance.

My last interview was with Patrick Pando, VP of Cloud sales, who left me with one last tidbit, “Artificial Intelligence isn’t a thing. It’s what we have before we have solved the problem, at which time it is merely the solution.”

Like my last podcast where I pondered AI, which, I said, is neither artificial or intelligence.

You can see pictures and some comments on my Twitter stream @garymintchell and #AVEVAWorld.

Software Investments—Looking Beyond the Surface

Taking a Digital Journey

Keynoters have a tough time with originality these Digital Days with everyone emphasizing Digital Transformation. Steve Lomholt-Thomson, chief revenue officer of AVEVA, took us on a Digital Journey this morning. Setting the tone of the three days of AVEVA World Congress (North America edition).

Three technology trends to watch: an IoT boom; cloud/empowered edge; and, AI / ML. The theme is digital. The Digital Organization discovers its Digital DNA, figures out how to build that Digital DNA through people who challenge the status quo; and then figures out how to track talent flow.

Which all starts us on our Digital Journey. On this journey, we unify end-to-end data, connect data silos taking an wholistic view of the business, and then visualize our assets and supply chain. I believe implied in all this is the company’s product AVEVA System Platform. The company touted six customer stories with at least five of them (and probably the sixth) all leveraging System Platform.

Oh, and the only time the “W” word was used referred to past tense.

Other areas of the company were highlighted:

Focus on assets–asset performance management including how to use machine learning (ML) and artificial intelligence (AI) for predictive analytics (predictive maintenance.

How to combine it all into a Digital Twin–bringing the design lifecycle and physical lifecycle into congruence.

Recently hired head of North America business, Christine Harding, interviewed customers from Campbell’s (soup/snacks), Quantum Solutions (integration project at St. Louis/Lambert airport), and Suncor (Canadian oil sands).

I have the rest of today and then tomorrow to take deeper dives into many of these topics. If there is anything you want me to ask, send a note.

Software Investments—Looking Beyond the Surface

Acquisitions Bolster Incumbents Further Consolidate Industry

The IT architecture of industrial / manufacturing applications increasingly boosts the role of cloud and edge. These technologies have become core to Industrial Internet of Things (IIoT) and improved Software as a Service (SaaS).

These recent acquisition news items reflect the acceleration of the trend. One is from Siemens and the other PTC.

Siemens plans acquisition of Edge technology

In brief:

  • Siemens further expands its digitalization portfolio for industry
  • Technology basis is the Docker IT standard
  • Siemens Industrial Edge ecosystem enables easy and flexible use of Edge apps

Siemens is planning the acquisition of Edge technology from the US company Pixeom. With this action, Siemens is strengthening its Industrial Edge portfolio by adding software components for Edge runtime and for device management. Siemens Industrial Edge provides an ecosystem, which enables the flexible provision and use of apps. This means for example that appropriate apps can analyze data locally at the machine and send relevant data to the higher-level Industrial Edge Management System for global analytics. With this acquisition, Siemens is driving forward the expansion of its Digital Enterprise portfolio and the integration of cutting-edge technologies for the digital transformation of industry.

With the resulting Industrial Edge ecosystem, industrial companies can use production data even more efficiently and react more flexibly to changes in conditions.

Ralf-Michael Franke, CEO of Siemens’ Factory Automation Business Unit, explains: “Cutting edge technologies such as Edge Computing open up new scope for automation. With Siemens Industrial Edge, we are creating an open edge ecosystem which offers benefits for companies of any size.”

Siemens is using Docker standard container technology: the provision of apps in the management system will therefore be just as simple as functional upgrades and updates of Edge devices in the factory from a central point.

Siemens intends to acquire this technology from Pixeom and use it in the Factory Automation Business Unit, which is part of Siemens Digital Industries. Pixeom has sites in San José, California and Udaipur, India and employs 81 people worldwide. Closing of the transaction is planned for the fourth quarter of 2019. Both companies have agreed not to comment on the financial details of the transaction.

PTC Makes SaaS Acquisition

I sat in on the analysts/press conference where PTC president and CEO Jim Heppelmann discussed the reason for this announced acquisition of Onshape, creators of the “first” Software as a Service product development platform. The company had also just released fourth quarter results. PTC has a little more than $1 billion in revenues, with about 45% CAD and 35% PLM. Interestingly, the IoT business contributes just over 10% of revenues.

Onshape’s product development platform unites computer aided design (CAD) with data management and collaboration tools, for approximately $470 million, net of cash acquired. The acquisition is expected to accelerate PTC’s ability to attract new customers with a SaaS-based product offering and position the company to capitalize on the inevitable industry transition to SaaS. Heppelmann believes that that cloud-based SaaS is the future of CAD. Pending regulatory approval and satisfaction of other closing conditions, the transaction is expected to be completed in November 2019.

Located in Cambridge, MA, Onshape was founded in 2012 by CAD pioneers and tech legends, including Jon Hirschtick, John McEleney, and Dave Corcoran, inventors and former executives of SolidWorks. Onshape has secured more than $150 million in funding from leading venture capital firms and has more than 5,000 subscribers around the world. The company’s software offering is delivered in a SaaS model, making it accessible from any connected location or device, eliminating the need for costly hardware and administrative staff to maintain. Distributed and mobile teams of designers, engineers, and others can benefit from the product’s cloud nature, enabling them to improve collaboration and to dramatically reduce the time needed to bring new products to market – while simultaneously staying current with the latest software.

“PTC has earned a reputation for successfully pursuing new innovations that drive corporate growth,” said Heppelmann. “Building on the strong momentum we have with our on-premises CAD and PLM businesses, we look to our future and see a new growth play with SaaS.”

This acquisition is the logical next step in PTC’s overall evolution to a recurring revenue business model, the first step of which was the company’s successful transition to subscription licensing, completed in January 2019. The SaaS model, while nascent in the CAD and PLM market, is rapidly becoming industry best practice across most other software domains.

“Today, we see small and medium-sized CAD customers in the high-growth part of the CAD market shifting their interest toward SaaS delivery models, and we expect interest from larger customers to grow over time,” continued Heppelmann. “The acquisition of Onshape complements our on-premises business with the industry’s only proven, scalable pure SaaS platform, which we expect will open new CAD and PLM growth opportunities while positioning PTC to be the leader as the market transitions toward the SaaS model.”

For customers, the SaaS model enables faster work, improved collaboration and innovation, with lower up-front costs and with no IT infrastructure to administer and maintain. For software providers, the SaaS model has been proven to generate a more stable and predictable revenue stream, increase customer loyalty as customers benefit from earlier adoption of technology innovations, and enable expansions into new segments and geographies.

“At Onshape, we share PTC’s vision for helping organizations transform the way they develop products,” said Jon Hirschtick, CEO and co-founder, Onshape. “We and PTC believe that the product development industry is nearing the ‘tipping point’ for SaaS adoption of CAD and data management tools. We look forward to empowering the customers we serve with the latest innovations to improve their competitive positions.”

Onshape will operate as a business unit within PTC, with current management reporting directly to Heppelmann.

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