Smartweek 2014 - Internet of Things (closing day 1 keynote)
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Closing keynote Day1 at Toronto Smartweek 2014 with University of Toronto at MaRS Discovery District. Friday October 24, 2014
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Smartweek 2014 - Internet of Things (closing day 1 keynote)
- 1. Smartweek 2014 Internet of Everything Rick Huijbregts @CiscoSCRE
- 2. Trends that Shape our World Social Demographics Economics Environmental/ Energy Technology ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 2
- 3. ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 3
- 4. ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 4
- 5. Video and Mobile dominates Internet Traffic 1 ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 6
- 6. Video and Mobile dominates Internet Traffic • Mobile video traffic was 53 percent of traffic by the end of 2013 • Global mobile data traffic grew 81 percent in 2013 • Over half a billion mobile devices and connections were added in 2013 • Last year’s mobile data traffic was nearly 18 times the size of the entire global Internet in 2000 © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 7
- 7. Application Economy 2 2,400 new Apps every day …and some will disrupt and cannibalize established business models. ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 8
- 8. Internet of Things The New Essential Application Centric Infrastructure 25 Inflection point 12.5 6.8 7.2 7.6 3 50 “Billion Smart Objects” Rapid Adoption rate of digital infrastructure: 5X faster than electricity and telephony World Population 50 Timeline 2010 2015 2020 40 30 20 10 0 Billions of Devices ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 9
- 9. Connected objects generate Big Data 4 46 million smart meters in the U.S alone 1.1 billion data points (.5TB) per day A single consumer packaged good manufacturing machine generates 13B data samples per day A large offshore field produces 0.75TB of data weekly A large refinery generates 1TB of raw data per day 10TB of data for every 30 minutes of flight With >25,000 flights per day, petabytes daily ©201T4 Cishco aend/o r itWs affiliatoes. Arll rligdhts re seGrved.enerates More Than 2 Exabytes of Data EveryCisc o DConfidaentiayl 10
- 10. Accelerated and Exponential growth of Data Wisdom (Scenario Planning) Knowledge Information Data Big Data Doubles Every Two Years 90% of world’s data created in last 2 years More new data generated in 2012 than prior 5,000 years By 2020, 40% of data will come from sensors More Important ©2014 Cisco Cisco and/and/or or its its affiliates. affiliates. All All rights rights reserved. reserved. Cisco Confidential 11 Less Important 4
- 11. Cloud 5 34% of data today is stored and managed in the “cloud” 25% of IT spending by Canadian government in 2015 is on Cloud-based applications ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 12
- 12. The Only Constant is Change Technology (r)evolution Technology (r)evolution Mobility / Video Cloud New Breed of Apps Internet of Things Big Data & Analytics 1 2 3 4 5 ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 13
- 13. By 2016, 80% of new IT investments will directly involve LOB executives, with LOBs the lead decision makers in half or more of those investments. IDC Predictions, 2014 ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 14
- 14. The Internet of Everything ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 15
- 15. Improved Experiences Fuel Innovation Connect for Better Outcomes Increase Efficiency Create New Markets Unlock Intelligence Minimize Risk © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 16
- 16. Cloud & Services Converged, Cloud-based Application Centric Networks Responsive Store Municipal Command & Control Center Smart Grid Hospital Optimization Comms Network Optimization Home Energy Mgmnt Factory Optimization Traffic Flow Optimization Logistics Optimization INTELLIGENT FACTORY Traffic Cameras INTELLIGENT HIGHWAY Automated Intelligent Digital Car System Signage Connected Ambulances INTELLIGENT CITY Intelligent Medical Devices INTELLIGENT HOSPITAL © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 17 Source: Intel The Network is the Platform for All Transformation
- 17. ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 18 Increase Parking Revenue 20-30% Reduce Urban Traffic 30%
- 18. IoT INFRASTRUCTURE Waste Collection Street Lighting Public Safety Emergency Environmental Monitoring Traffic Lights Amsterdam: ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 19 $13M Savings in Leasing Cost South Korea: $13B Savings in Transit Expenses
- 19. “We are obsessed with building quality of life for our citizens. We needed to break through organizational siloes and Cisco became our IoE backbone. That is our present and the future of our city.” Delivery Business Value Connecting the Unconnected Barcelona Antoni Vives, Deputy Vice Mayor, City of Barcelona, Spain Smart Lighting Smart Buses Smart Water Smart Bus Stop Smart Parking Smart Waste Productivity: Mobile Collaboration: $1.6B | Telework: $199M Revenue: Smart Parking: $67M Cost savings: Smart Water: $58M | Smart Lighting: $47M Smart Citizens 1,500 New Companies 56,000 New Jobs Mobile Collaboration: $1.6B Telework: $199M Smart Parking: $67M Smart Water: $58M Smart Lighting: $47M Economy: 1,500 New Companies | 56,000 New Jobs Revenue Citizen Experiences Jobs Productivity Cost Avoidance ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 20
- 20. $2.5M 400% Savings Production © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 21
- 21. © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 23 1-2% Fuel Savings Double Passenger Capacity
- 22. IoT INFRASTRUCTURE Passenger Wi-fi Route Optimization Onboard Security Predictive Maintenance Fuel Consumption 1% Efficiency Savings = $1.8B Per Year for Rail Industry © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 24
- 23. 95,000 network-connected building points © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 25
- 24. HIGH © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 26 ENERGY USE LOW MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY
- 25. HIGH MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 27 ENERGY USE LOW 21% Energy Cost Savings
- 26. Unlocking Intelligence Not without challenges… Complexity Security © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 28
- 27. Sizing the Opportunity Value at Stake $19.0* Trillion $14.4T Private Sector $400B $96B Includes both industry-specific and horizontal use cases. • Customer Experience • Supply Chain • Innovation • Asset Utilization • Employee Productivity $4.6T Public Sector Includes cities, agencies, and verticals such as healthcare, education, defense. • Increased Revenue • Reduced Cost • Employee Productivity • Connected Militarized Defense • Citizen Experience Estimate is based on bottom-up analysis of 61 use cases, including 21 for private sector and 40 in public sector * 2013-2022 © 2013-2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 29
- 28. Convergence – How Can We Enable the Creation of New Industries New Ecosystem Public Private Partnerships & People Smart Regulation Global Open Standards Visionary Leadership ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 30
- 29. ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 31
- 30. “Don’t bother me with new ideas, I’ve got a battle to fight!” ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 32
- 31. What We’ve Learned: Importance of People and Process To capture more IoE value, companies must: 2 Adopt and follow inclusive practices that foster collaboration 3 Develop effective information management practices 1 Invest In high-quality technology infrastructure and tools ©2014 Cisco and/or its affiliates. All rights reserved. Cisco Confidential 33
- 32. Are you Ready? Tomorrow Starts Here. Rick Huijbregts rhuijbre@cisco.com @CiscoSCRE @Rick_Huijbregts
Editor's Notes
- The World is changing, we’re going through massive rebalancing in economic growth, socially – talent re-shuffling, and environmentally – natural resources. THE world will consume 40% more energy in 2030 than it does today, according to BP's Energy Outlook – The Economist, Jan 2012 http://www.economist.com/blogs/graphicdetail/2012/01/daily-chart-14 Many CIOs also understand the value the network brings to the business. They are tasked with delivering the best tools to enable the business and drive employee productivity. But the CIO must also balance the needs of the users with the needs of the business – ensuring the business is secure and its IP is protected. How does the CIO deliver a “work, your way” experience that the next generation demands? The pace of innovation continues to accelerate, making it difficult for companies to keep up with innovations as they enter the market. Companies recognize that they must not only innovate, but innovate faster. To achieve this goal, companies should establish an innovation process that: provides access to a variety of innovation sources mills the best ideas from that process applies those innovations to products and services This process should increase the impact and value of innovation and decrease the time required to get products to market.
- Rapid Adoption rate of digital infrastructure: 5 times faster that any other previous infrastructures such as electricity, telephone etc. Cloud Security Xaas Security
- In the past 2000 years, the world has generated a little more than 2 exabytes of data … we now generate that amount every day. These objects are creating a data explosion, with data coming from billions of disparate devices, located all around the world. But unless they can work together, all of this data is siloed, and therefore relatively useless …
- Over the past six years business demands for productivity, increasing globalisation and the consumerization of IT have remained constant – what has continued to rapidly evolve are the technology responses we have implemented to the business demands. Familiar technology trends like ubiquitous connectivity, mobility and Bring Your Own Device (BYOD) are culminating in the technology transition that we see as the consumerization of IT. Simply put, employees are demanding the same technology experience expectations in their workplace that they have in their personal lives (Amazon.com, Online banking, etc.) Additionally, companies and organizations are being faced with the demand for technology as a service inside the Enterprise. Employees want the ability to access any application, any time, anywhere – from the device of their choice. Technology responses start with the Technology Architectures that enable security, flexibility, speed and scale for the business
- Our innovation began with the first multi-protocol router in 1984 and was boosted in 1987 with $2 million in venture capital. By 1993, we had $714 million in revenue and had hit a milestone of shipping 100,000 routers. Then came the first small office, home, and telecommuting cable modem. In 2004, we introduced the CRS-1 series and in 2006 TelePresence. Most recently, our engineers introduced the Network Convergence System—or Cisco NCS. It provides the performance and intelligence service providers need to cope with increasing mobility and cloud computing. It provides the broad capabilities to manage the Internet of Everything, and the dramatic number and type of connections. Year after year we’ve had a singular focus—innovate to help our customers succeed.
- Already, we’re beginning to see people, process, data, and things come alive on the Internet as part of the Internet of Everything. This transformational era is creating new connections, turning information into actions—actions that create new capabilities, richer experiences, and incredible economic opportunities. Think Connected Cities, Connected Retail, Connected Homes. You name it. For instance, we’re helping cities manage resources and provide citizen security. We’re helping retailers maintain inventory and anticipate shoppers’ needs. And we’re helping homes know when to turn off the lights and turn up the heat. And that’s just the beginning. Businesses are already simplifying the customer experience and making their relationships more meaningful and more valuable. And even more exciting, the Internet of Everything is creating a huge financial opportunity. From 2013 to 2022 it will create $19 trillion of value for the world’s private and public sectors combined. The private sector will account for $14.4 trillion, while $4.6 trillion of this value will come from the public sector. (The value is caused by increased revenue and lower costs.) ADDITIONAL INFO FOR THE PRESENTER How does the Internet of Everything differ from the Internet of Things? Internet of Everything (IoE): The Internet of Everything is the networked connection of people, process, data and things. Several technology transitions—including IoT, increased mobility, the emergence of cloud computing, and the growing importance of big data, among others—are combining to enable IoE. Internet of Things (IoT): The Internet of Things is the networked connection of physical objects. IoT is one of the many technology transitions that make up IoE. DEFINITION OF PEOPLE, PROCESS, DATA, AND THINGS: People: As the Internet evolves toward IoE, we will be connected in more relevant and valuable ways. Today, most people connect to the Internet through their use of devices (such as PCs, tablets, TVs, and smartphones) and social networks such as Facebook. In the future, people will be able to swallow a pill that senses and reports the health of their digestive tract to a doctor over a secure Internet connection. In addition, sensors placed on the skin or sewn into clothing will provide information about a person’s vital signs. According to Gartner, people themselves will become nodes on the Internet, with both static information and a constantly emitting activity system. Process: Process plays an important role in how each of these entities — people, data, and things — works with the others to deliver value in the connected world of IoE. With the correct process, connections become relevant and add value because the right information is delivered to the right person at the right time in the appropriate way. With an emphasis on security and policy compliance that protects personal information. Data: With the Internet of Things, devices typically gather data and stream it over the Internet to a central source, where it is analyzed and processed. As the capabilities of things connected to the Internet continue to advance, they will become more intelligent by combining data into more useful information. Rather than just reporting raw data, connected things will soon send higher-level information back to machines, computers, and people for further evaluation and decision making. This transformation from data to information in IoE is important because it will allow for faster, more informed decision making and even provide predictive capabilities. Things: This group is made up of physical items like sensors, consumer devices, and enterprise assets that are connected to both the Internet and each other. In IoE, these things will create and monitor more data, become context-aware, and provide more experiential information to help people and machines make more relevant and valuable decisions. Examples of “things” in IoE include smart sensors built into structures like bridges, and disposable sensors that will be placed on everyday items such as milk cartons.
- By improving existing connections, you can unlock more value from your existing technology infrastructure, or free up resources for innovation. And by creating new connections, you can accelerate new opportunities for growth (Click) Through the Internet of everything, you’ll create superior and more personalized experiences for your customers. (Click) It’s where you’ll deliver new products and services—quickly and intelligently. Who knows what next big thing your business might create. (Click) Your organization will also run more efficiently—lean and mean like never before. Reducing costs. Increasing productivity. Getting to market faster. (Click) And how about taking advantage of a world that’s increasingly connected? Can you see your business creating or entering entirely new markets? (Click) In this era, which is happening now, you’ll also get more from your data. It will tell you things you didn’t know before—things you can put into action to improve your business. (Click) And the beauty is you can achieve all of this while protecting your data, keeping your privacy promises, and complying with government regulations. By taking advantage of the Internet of Everything, you have boundless opportunities to innovate. To stand out from your competitors. And to make and save money. Just name it. This is what the Internet of Everything has to offer, and Cisco and our partners can help you capture your share. In 2013, businesses that did the heavy lifting required to create more valuable connections got a (Click) $600 billion dollar payoff. The bad news is another (Click) $600 billion went untapped by companies who weren’t fully prepared. Source: IoE Value Index research, conducted by Cisco Consulting Services about the IoE Value at Stake.
- It’s a similar story with “smart cities” … Wouldn’t it be great if, while you were looking for parking, you could look on your smart device and see a map with green dots nearby where there is parking and compare rates? From the point of view of the city, this leads to more revenue because people will find space more easily and utilization rates go up. And it’s possible to implement flexible, demand-based pricing, by gathering usage data and testing price thresholds during peaks and lulls. As a result, the quantifiable benefits to both the city and the drivers are abundant: 30% of urban traffic is caused by drivers circling the block looking for parking That’s tied to an additional 1-2% of fuel used, which has a negative impact on the environment and represents lost productivity Research has found that while users save 22% on the price of parking, cities can increase revenue by 20-30% -- so everybody wins
- Here again, that new revenue funds an infrastructure that can support more apps. Consider, too, that a lot of what governments do doesn’t generate revenue for critical services such as public safety and emergency services. So the income-producing IoT apps (eg, automated tolls, waste collection, even tax collection) are a way to offset those costs.
- Start with Quote: Add #s jobs created, # of business Barcelona voted Europe i Capital http://europa.eu/rapid/press-release_IP-14-239_en.htm
- Dundee Precious Metals has turned a centuries-old business—mining—on its edge. They did this by connecting people, process, data, and things in their flagship mine in (Chelopech) Bulgaria. It’s here where workers extract gold, copper, and silver from deep below the earth’s surface. It’s also here where a mining company embraced innovation through the Internet of Everything. And at the center of it all is a large-scale intelligent wireless network. Their transformed mine connects people around the world, so that techs can fix problems remotely. They efficiently use valuable vehicles through location tracking, while also monitoring them to prevent breakdowns. They automate building controls. Plus, Dundee has improved miner safety by connecting their blasting system with their location-tracking system. Their targeted goal? A 30-percent increase in production. Their reality? (Click) A quadrupling of their production to 2 million tons annually. They’re also (Click) saving $2.5 million on communication over two years. And miner safety? You can’t put a price on that.
- In the United States there is legislation requiring the railway industry to implement a traffic control system called Positive Train Control. This is to avoid terrible accidents like the one in Northwestern Spain in mid-2013. (The driver went too fast around a curve, and 79 people were killed) Along with increased safety, train operators get alerts that help them optimize routes based on track, traffic and other data. Other apps include predictive maintenance and wayside equipment tracking. Cisco estimates that customers can use our PTC solution to save 1-2% in fuel costs through optimal throttling and braking data sent to engineers via a wireless tablet. Union Pacific in the US saved 4-6% in fuel costs with their system. They found that their best engineers use only two-thirds the fuel of their least efficient drivers. UP has put rewards in place to incent fuel-efficient practices (as well as serious talks with underperformers).
- And the PTC infrastructure can also carry along passenger wi-fi and safety applications, as well. Using Cisco’s PTC solution, Connected Trackside for Passengers, railroads will deliver converged multi-services IP networks that can enable cost effective communication solutions for electrification that can double passenger capacity along the same track infrastructure. Rail operations costs represent 75 percent of total trail transport costs, or $184 billion per year. GE Transportation estimates that 2.5 percent of rail operations costs are the result of system inefficiencies. This amounts to $5.6 billion per year in potential savings. If only one percent savings can be achieved, the amount saved would be about $1.8 billion per year or about $27 billion over 15 years. Similar types of efficiencies appear possible in heavy duty trucking, transport fleets and marine vessels, meaning much larger transportation system benefits can likely be realized. --GE report on Industrial Internet, Nov. 26, 2012, p.21 http://files.gereports.com/wp-content/uploads/2012/11/ge-industrial-internet-vision-paper.pdf
- Manufacturing plants use a lot of energy and, when they go above a certain utilization rate, they’re charged more per unit of energy. So if they can figure out how to even out their usage to avoid spikes, they can save money. Right now, most manufacturers have a separate IT set-up and a separate network for the manufacturing plant versus headquarters. To shave those energy peaks you need to know a few things. First, you need to know what’s going to be built when. That information comes from the “Master Execution Scheduler” which is kept on the proprietary manufacturing network. But you also want to know what’s been committed to customers so you don’t save money on energy yet drive away customers in the process. That information is in your ERP system on your corporate network. And then you want to know how changing the schedule might affect labor costs, so you don’t lose all the money you saved on energy, making the whole exercise pointless. For that, you need information from your HR system, also on your corporate network. Then you need to analyze the information.
- Manufacturing plants use a lot of energy and, when they go above a certain utilization rate, they’re charged more per unit of energy. So if they can figure out how to even out their usage to avoid spikes, they can save money. Right now, most manufacturers have a separate IT set-up and a separate network for the manufacturing plant versus headquarters. To shave those energy peaks you need to know a few things. First, you need to know what’s going to be built when. That information comes from the “Master Execution Scheduler” which is kept on the proprietary manufacturing network. But you also want to know what’s been committed to customers so you don’t save money on energy yet drive away customers in the process. That information is in your ERP system on your corporate network. And then you want to know how changing the schedule might affect labor costs, so you don’t lose all the money you saved on energy, making the whole exercise pointless. For that, you need information from your HR system, also on your corporate network. Then you need to analyze the information.
- Once you’ve brought all the right systems together, you can build an application with thresholds and policies that alert operators to an approaching peak and show gaps in the schedule—times they could push the production load to. Or they can shift production to another plant with more capacity. But that requires adjusting supply chain, MRP, and the factory build plan to compensate without impacting customer commitments or desired inventory levels. Or they can check the power co-generation system to see if they can keep production high but use co-gen energy to avoid the peak. But something interesting happens, once you’ve created your killer app….
- It’s complexity and cost of managing technology. It’s unlocking intelligence to fuel growth. It’s managing risk and ensuring your business and technology are secured.
- Cisco estimates that the Internet of Everything is poised to generate $19 trillion in Value at Stake over the next 10 years (2013-2022) for the private and public sectors combined. The private sector will account for $14.4 trillion, while $4.6 trillion of this value will come from the public sector. These estimates are based on a bottom-up analysis of 61 use cases, including 21 for the private sector and 40 in the public sector. The private-sector estimate includes both industry-specific and horizontal use cases, while the public sector number covers cities, agencies, and verticals such as healthcare, education, and defense.
- So how can we help solve these issues? we need visionary leadership by political and key business leaders to visualize a different way to build and operate a city open global standards so that it can become a globally interconnected city, technologically and economically Smart regulation by governments to redefine infrastructure development and city operations Public private partnerships with governments and private enterprises and I would add to that now a 4th P – People Global ecosystem of partners that include academia, business, and social networks. It takes all five of these factors…without one, it changes completely.
- The management practices that best predict changes in value realized are: Inclusiveness — enabling all employees to contribute and collaborate effectively. Companies make better decisions and maximize the value of experts located throughout the organization when they are more inclusive. In fact, better collaboration within companies is one of the three areas executives think will benefit most from IoE. According to Cisco’s recent “Enterprise Collaboration” study (http://www.cisco.com/web/about/ac79/ docs/re/Enterprise-Collaboration_Top-10.pdf), 93 percent of respondents from companies with inclusive business environments indicated that their investments in collaboration solutions outperformed expectations in terms of business value created. By contrast, only 28 percent of respondents from non- inclusive companies felt the same way. Information management — using data strategically to achieve company objectives. It is not data itself, but how it is managed and used, that determines success in realizing IoE value. Human capital management — managing a company’s workforce and developing needed talent. Having and managing the right mix of employee skill sets is crucial for any company. However, as IoE becomes a bigger contributor to corporate profits, firms will have to evaluate their technical and management expertise continually in order to thrive. Measurement — tracking progress toward company goals or targets. Companies that measure performance gain a larger share of IoE Value at Stake than competitors that are less “fact-based” in their decision-making processes. Based on these findings, to capture value from IoE, companies must follow a roadmap that invests in a high-quality infrastructure, adopt inclusive practices that foster greater and more effective collaboration, and develop effective information management practices.