Thomas Edison would be proud. General Electric, the company he started, still knows how to make a buck off cutting-edge technology.
By Quentin Hardy
In this case, the technology is in the so-called Internet of Things, in which sensors feed data to central repositories, which can analyse and manage enormous amounts of data from the machines. Initial uses include more efficient maintenance, remote monitoring, asset tracking and spotting new patterns of behaviour that might be profitably exploited.
Work on the IoT has been a priority of GE’s chief executive, Jeff Immelt, for more than three years. Last week, the company announced that revenue from its IoT software business will be $1.1 billion this year, probably the fastest a GE business has hit the $1 billion mark.
The company did it entirely with sensor-equipped GE machines, including 1.4 million pieces of medical equipment and 28,000 jet engines. All in, the company said, each day it now gathers 50 million pieces of data from 10 million sensors, off equipment worth $1 trillion.
Next year, GE plans to connect this big data product, called Predix, to machines made by other companies. It is also establishing a means for companies to build and deploy their own customised software applications on Predix. Part of that approach involves using GE’s own modeling software, which helps a customer understand ahead of time whether making the software is justified by anticipated cost savings.
If successful, the GE analysis platform will likely touch tens of millions of devices around the globe. Already, Cisco has agreed to put Predix software inside its networking products, starting with a specialised computer router for harsh environments like oil fields. Intel has developed a reference architecture that integrates Intel processors with the GE software.
Softbank, Verizon and Vodafone have agreed to provide means of wireless connectivity to devices with the software.
GE already has a deal like that with AT&T, which means the system could be used across much of the globe. In a release announcing the deals, Immelt said that “Our offerings will increase GE’s services margins and boost organic industrial growth, with the potential to drive as much as $20 billion in annual savings across our industries.” “The world cannot go on managing in a large-scale fashion using old technology practices,” said Bill Ruh, vice president of GE software. “This enables people to put more intelligence in their machines, and do real-time control of their equipment.”
Much remains to be seen, including what GE plans to charge for its software and services, and whether customers are comfortable moving their data through a GE platform. While GE already has 40 so-called “predictivity” offerings, for areas like energy, transportation, aviation and healthcare, Ruh said that GE sees offering its platform to others “as a way to go into other industries.”Presumably he meant the sale of software to these, but that prospect could also make some businesses uncomfortable.
This is the latest in a series of steps by GE to be a force in what it terms The Industrial Internet. In June, GE and others announced a global standards body to speed the deployment of sensor-laden machines. Ruh said the product offering also included new kinds of online security, so potential weaknesses could be remotely patched across a large system. This kind of global application management and updating has become increasingly important, as more businesses adapt to a world of remote devices connected to powerful data centers.
Ruh also said Predix currently touches 21,500 GE locomotives, 23,000 GE wind turbines, 3,900 gas turbines and 20,700 pieces of oil and gas equipment. His software division, located near Silicon Valley, now includes 1,200 people, and will add another 100 people by 2014 end. Attrition in 2013, he said, was 1.1%, an unusually low number in a hot engineering market.
