Cisco is a company in transition. It is positioning to be an IIoT end-to-end solution provider with its full line of networking software and hardware products, along with partners in almost every industry segment including Rockwell Automation, GE, Fanuc Robotics, Siemens, Emerson, Honeywell, ABB, Cablevision, Actility and more. What is Cisco’s gold-hunting formula?
By John Koon, Editor
Cisco is the largest networking company in the world with annual revenue of $49 billion. Much like the PC market a few years ago, hardware costs are coming down and competitors everywhere are trying to gain market share. At the high-end, there are HP, Palo Alto Networks and Alcatel-Lucent SA while Chinese companies like ZTE and Huawei are working hard to compete on low cost networking hardware. Cisco is trying to transition from being a networking hardware provider to an all-in-one IIoT Solution Provider.
The Cisco Formula
To solve problems in other segments such as manufacturing, Cisco partners with Rockwell, a manufacturing expert, to provide a complete IIoT “smart manufacturing” solution. This is Cisco’s IT (information technology) plus OT (operation technology) formula. By teaming up with other OT experts in various fields, Cisco can solve problems in Manufacturing, Industrial Automation, Smart Cities, Smart Building, Healthcare, Connected Automotive, Oil and Energy, Smart Grid and the list goes on. Cisco continues to invest internally and externally to build up its strength. In March of 2016, Cisco acquired Jasper, a provider of global cloud-based Internet of Things (IoT) service platform. Its platform services are used by more than 27 mobile operator groups and 2700 companies including GE, Coca-Cola and Amazon. This new addition allows Cisco to expand its IIoT services to enterprises, service providers and its entire ecosystem.
While Cisco offers IIoT solutions in almost every industrial segment, it has highlighted three major applications with its new product offerings in Connect Machines, Connected Factory and the LoRaWAN. Cisco’s main goal is to help customer create value using IIoT as a tool.
“Cisco has a significant growth opportunity in helping our customer’s transform their IoT data into business value. We are delivering an end-to-end IoT solution built on secure connectivity, service management and data delivery to cloud applications,” commented John Reno, IoT product and solutions marketing at Cisco. “Customers in segments such as manufacturing, transportation and energy have worked with our ecosystem partners to achieve important results ranging from improved overall equipment effectiveness to new customer services.”
Cisco promotes the idea of Industrial Transformation using IoT in which everything will be connected, monitored and managed to produce the optimal results with lower costs. Smart manufacturing builds on connected machines and factories. The performance of machines will be monitored continually in real-time and early warning will be provided if a machine is about to shut down before it actually occurs. Preventive maintenance is an important contribution of IIoT because it can avoid a production line shutdown. These machines (devices) can be connected securely and machine data can be transferred in real-time so management can manage and act instantly. The connected machine (Figure 1) approach will provide machine and tool makers to grow their business with the help of Cisco. A true partnership.
Figure 1: Connected machines increase productivity in smart manufacturing. Currently, 92% of the 64 million machines are not connected. These offer vast opportunities to companies who provide solutions in this area.
To support the connected factory, Cisco has recently introduced the new industrial switches IE4010 and IE1000 along with enhancement to the industrial security appliance ISA3000. The IE4010 is a 24 port, multi-gigabit ruggedized switch with the capability of in-line power over Ethernet (PoE) while the IE1000 is an eight port version while ISA3000 enables the Common Industrial Protocol (CIP). Figure 2. These solutions also provide surveillance security using IP cameras throughout the factory.
Figure 2: The IE4010 and IE1000 industrial switches are among the new Cisco products introduced in the Connected Factory solutions. These secured end-to-end connections also provide surveillance capability using IP cameras.
Here is an example how Cisco adds value to its partner. Mazak Corporation is a machine and tool company that wanted to provide their end customers products with IIoT capability. Working with Cisco, Mazak was able to develop the Mazak SmartBox technology. Figure 3. The application needed to run on the factory connecting to the network backbone. Real-time analytics were required to handle data on high frequency vibration, temperature, coolant and sound input. The data would be processed to deliver optimal machine performance. In this solution, Cisco Industrial Ethernet 4000 (IE4000), switch along with the Cisco Connected Streaming Analytics and other software were used. As a result, Mazak is able to offer its customers a connected machine service, a new revenue opportunity.
Figure 3: The Mazak SmartBox technology provides real-time analytics of data on high frequency vibration, temperature, coolant and sound input.
Cisco is a strong supporter of the LoRa Alliance, a non-profit organization focuses on developing the low power, wide area network (LPWAN) specification. Its data rate is from 0.3 to 50 kbps perfect for transactions involves infrequent small packets and it can be very low cost. A battery powered device would be able to work for 10 years without battery replacement. Applications include assets tracking like a moving truck, transportation, equipment used in the factories as well as in supply chain management, smart buildings, metering and irrigation management. “We are seeing dramatic growth in a new class of IoT sensors that require low power and low cost secure connectivity. LoRa is enabling new services for a whole host of IoT applications. LoRa’s ability to communicate without draining excessive power makes it ideal for smart city and industrial asset monitoring and management use cases”, commented Vikas Butaney, General Manager, IoT Systems and Solutions of Cisco, “This extends the lifetime of those devices and makes them viable to deploy at a large scale. Cisco is incredibly excited about the possibilities of LoRa and the growth of the LoRa partner ecosystem led by the LoRa Alliance.”
Analytic and Data Services
Analytic and Data Services are crucial to the success of IIoT implementation. Simply sending raw data to the cloud or connected devices has no real value unless the data is consumed in a meaningful way. Getting the insight is the key. Cisco’s solution is to help customers get that insight via cloud data and edge product management. For example, as in the case of an oil and gas offshore drilling platform application, the goal of the customer is to obtain optimal performance from each well. There is no value to send the raw data of measuring temperature, vibration and moisture of each well every second to the server via the cloud. The big question is what to do with all the data generated? Where is the insight? The better approach will be to process the raw data by the edge products such as using an intelligent Cisco router and run the analytic per well onsite. Then send the results to the server. Another meaningful insight will be to compare the results of each well and from that data determine the parameters of a high performance well. By doing this, Cisco will be able to help customers to achieve the best performance. In June of 2016, Cisco joined force with the IBM Watson team to further the insight capability. “The way we experience and interact with the physical world is being transformed by the power of cloud computing and the Internet of Things,” said Harriet Green, General Manager, IBM Watson IoT, Commerce & Education. “For an oil rig in a remote location or a factory where critical decisions have to be taken immediately, uploading all data to the cloud is not always the best option. By coming together, IBM and Cisco are taking these powerful IoT technologies the last mile, extending Watson IoT from the cloud to the edge of computer networks, helping to make these strong analytics capabilities available virtually everywhere, always.” Additionally, in June of 2016, Cisco added another tool, Cisco Tetration AnalyticsTM Platform, to help customers gain visibility of the performance of operations in real-time.
How does Fog computing fit in?
In a simple case, cloud computing will be able to provide all the computing and storage needs one desires. But as the IIoT application complexity increases, cloud computing may not be able to meet demands. This is where Fog Computing comes in. The name Fog was developed as it resides between the Cloud and the ground. Recently the Open Fog Consortium (OpenFog) was established with the cooperation of Cisco, Dell, Intel, Microsoft, ARM and Princeton University. Part of Cisco’s IIoT strategy is to promote Open Fog. To implement Fog Computing, local networking devices with computing power will be implemented. This will potentially help Cisco with future sales of networking solutions. “Fog Computing brings data processing, networking, storage and analytics closer to devices and applications working at the edge of the network. The maturing cloud technologies and the rapidly widening spectrum of services required to support the emerging Internet of Things means that fog computing will have a key part to play in the coming years, bringing cloud computing capabilities to the edge of the network and the vast number of devices that are consuming cloud services and generating massive amounts of data”, continued Helder Antunes, OpenFog Consortium Chairman and Sr. Director – Corporate Strategic Innovation Group at Cisco, “Significantly, Fog Computing also tackles another key issue in cloud computing, reducing the need for bandwidth by only sending critical information over networks to the cloud. This type of distributed strategy will introduce new computing and networking capabilities; lower costs, improve efficiencies, extend the life of existing computing and networking infrastructures; make the exponentially large amounts of data much more manageable; and ultimately help businesses successfully get to grips with emerging IoT trends.”
The market is in transition. The future is unclear and is full of risks. For those who can navigate through the IIoT maze the reward can be great. Cisco is no exception. Facing margin erosion from competitors, Cisco must find its path. Right now, Cisco is well positioned with its IIoT strategy; secured end-to-end networks, analytic services, LoRaWAN, Fog Computing and strategic partners. Cisco has been and will continue to be a formidable force. Its annual IoT World Forum has showcased Cisco’s IIoT muscle and its massive partner network worldwide. The question is how will the market respond? How much will they spend and how fast? The other up-and-coming, fast-moving companies are aggressively going after the same market with possible faster speed and lower-priced solutions. Cisco needs to maintain certain level of margin, while the new start-ups can survive with lower overhead. Will these companies be a real threat to Cisco? “Cisco needs to operate in an efficient manner and execute its strategy smoothly to maintain its leadership,” commented Timothy Zimmerman, Research VP, Internet of Things at Gartner, “otherwise, it would risk losing market share”. While the IIoT market has a lot to offer it is also changing fast. Cisco’s future success depends on how well they can execute their IT plus OT strategy.