UPDATED 16:00 EDT / JUNE 19 2013

NEWS

GE’s Unassailable Lead in the Industrial Internet

As if yesterday’s announcement that it’s building a new Industrial Big Data platform and expanding its partnerships with Accenture, Pivotal and Amazon Web Services wasn’t enough, GE is planning on hiring “thousands of engineers” in the second phase of what amounts to nothing less than an Industrial Internet “land grab”.

GE’s multi-billion dollar push to connect everything from jet-engines and oil refineries to medical imaging machines and bridges has one common goal in mind – to make everything more efficient.

Beth Comstock, chief marketing officer at GE, appeared at the Bloomberg Next Big Thing Summit yesterday, where she revealed that the company had just opened a software center in the East Bay, where it planned to hire thousands of new software engineers:

“[we’re doing this] basically to bring all the great innovation you’ve seen in Silicon Valley now to industry. We probably haven’t seen anything yet when it comes to data when machines start talking to machines and machines start talking to people. We have to make sense of it.”

GE first revealed its intent to corner the Industrial Internet late last year, describing how it planned to build massive networks capable of tracking data from machines, before supplying the services that industry needs to help collect, store and analyze all of that data.

To date, GE has already invested $1 billion in a new facility at San Ramon, near Silicon Valley, which will be tasked with analyzing all of that data. Now, Bloomberg reports that the next phase of its master plan is underway, with GE already having poached a number of engineers away from firms including Symantec, SAP and Oracle, as well as new hires from universities including Berkeley, Stanford and the University of California.

This wave of new hires ties in with GE’s big announcement yesterday – wherein it describes a connected future for the world of industry, in which machines talk to one another via sensors that communicate to the cloud, from which companies are able to harness the power of that industrial data to automate business process and make them more efficient. This kind of architecture will have massive implications on the future of industry, not least where money is concerned – Wikibon yesterday reported that it expects the Industrial Internet to be valued at somewhere close to $1.279 trillion by 2020, just seven years from now.

In particular, aviation appears to be a vital component of GE’s plans in the years ahead. Recently, the company revealed how its engineers had incorporated next-generation ceramic parts capable of withstanding higher temperatures into its jet engines, which would lead to reduced maintenance and fuel costs. These designs were aided in part through data, and according to Comstock, GE has reached the stage where its jet engines rarely break down at all.

Yesterday was a busy day for Comstock, who also took time out to appear on theCUBE alongside John Furrier and Dave Vellante, where she provided some more insights into how GE’s Industrial Internet is helping them with jet engine design:

“What happens with good engineering is that after a while, the assets are so good they don’t break.” explained Comstock.

“Now we have the ability to take that data and do more with it, the ability to say ‘when this engine needs to come in for repair early’, or maybe it doesn’t need to come in for repair, so we have this idea of no unplanned downtime.”

The inherent value of this ability was recently illustrated by GE’s CEO Jeff Immelt, when he told All Things D that even a one percent improvement in commercial aircraft operations could translate into savings of $2 billion a year on fuel costs for airlines.

With the inauguration of its new Industrial Big Data platform and its recruitment drive now well underway, GE appears to be well on the way towards establishing an unassailable lead as the key mover and shaker in the Industrial Internet. Its main rival in the aviation business, United Technologies, is trailing far behind in its wake, and although its touting its Geared Turbofan engine as being able to shave 15% off of fuel costs, it’s practically stood still when it comes to data. The most it can offer is its Integrated Media Systems Center, a platform that’s hugely outdated when stood up against the Industrial Internet.

The future for the Industrial Internet, and most especially GE, is looking like an extremely bright one. Now the onus is on its competitors to figure out how they can compete.


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