>> [Narrator] From Boston, Massachusets it's theCube.
Covering LiveWorx 18.
Brought to you by PTC.
>> Welcome back to bean town, everybody.
This is theCube, the leader in live tech coverage,
and we're covering LiveWorx,
the three day conference hosted by PTC.
We're at the BCEC, which is kind of the Starship Enterprise.
I'm Dave Vellante, with my co-host Stu Miniman.
As I say, Cube one day coverage
of this three day conference.
Maciek Kranz is here.
He's the Vice President of Strategic Innovations at Cisco.
Maciek, thanks for coming on theCube.
>> Thank you so much for having me.
It really looks like a cube.
>> Usually we're out in the open,
but they've put us here in a cube, which is great.
Of course we were at Cisco Live last week.
You were there, it was an awesome show.
27, 28 thousand people.
A lot of the innovations that we're talking about here,
you guys, you know, at Cisco, are obviously touching upon.
Whether it was blockchain or the edge.
May I ask you, innovation's in your title.
What are you doing here at this conference?
>> Basically we're on the mission
to make sure that every company,
large and small, whatever the industry you're in,
gets started on the IOT journey.
All of us here, we were talking
about it last week at Cisco Live,
we are sort of on the mission
to make sure that everybody knows how to do it,
how to get started, how to go through the journey.
So I'm here to promote the cause.
>> You had posted a blog a little bit ago on LinkedIn.
Check it out, if you go to Maciek's
LinkedIn profile you'll see it.
Five myths around IOT,
and I thought it was quite instructive.
I'm gonna start with the middle of it,
which is IOT is this one big market,
and we've been talking about
how it's a trillion dollar market.
It's almost impossible to size.
It's so fragmented, and bringing together
the operations technology and information technology world,
and there's the edge, there's the core, there's hardware,
there's software, there's services.
How should we think about the IOT,
obviously not as one big market
as you pointed out in your blog.
>> Right, and you actually nailed it.
When you think about sort of a traditional way
that technology companies think about the market,
it was sort of model of just get a billion people
to get on your platform and the good things will happen.
Well in the IOT space, as you pointed out,
it's a very fragmented market.
So you basically need to have two strategies.
You either become a horizontal specialist
and then you integrate with a vertical specialist
to develop a joint solution, or you focus on use case
and you focus on one market,
and you go deep and focus with customers.
So from that perspective the approach is different,
but in a nutshell to be successful in this space,
it's not only about technology, it's about ecosystem.
It's about building the coaliltion of the willing,
because at the end of the day, the customers
want solutions to their problems.
And they don't want to just buy your technology,
they want to work with you on developing solutions
that drive business outcomes.
>> Maciek, one of the things that's been interesting
to watch is that people want to try,
and they want to try faster.
One of the big benefits of public cloud was
that I have this sandbox that I could
throw some people at, have a little bit of money,
and try things and fail and try again.
One of the concerns I have when I hear things
like PTC and Microsoft get up on stage and say,
"It's gonna take 20 to 25 partners to put this together."
When I hear that it's fragmented,
it's gonna take time, it's gonna take money, help us.
Are there are ways I can start playing with things
to understand what will and what won't work
for my environment, or is this something
that I have to throw a million dollars
and group of people for a year and a half on?
>> It's actually a great point, and it's another,
I would say, misconception, which is I need to go deep,
have a sort of a big strategy.
One of the things that I talk about with the customers is,
yes, dream big but start small.
So yes, have a sort of a big vision, big architecture,
but then focus on a first project,
because it's a multi-year, multi-phased journey.
So from that perspective, you know,
at Cisco we have roughly 14,000 customers
that already got started on this IOT journey,
and the use cases that we've seen
sort of are in four different categories.
First one is connect things, so connecting your operations,
the second one is remote operations,
the third one is predictive analytics,
the fourth one is preventive maintenance.
So don't be a hero, pick one of these four use cases,
try it out, then do a ROI on this,
and if your ROI is positive then do a next,
maybe more sophisticated, more adventurous
kind of a project down the road.
So pace yourself.
>> This is our 9th year doing theCube,
and the one thing we've learned
about information technology, operations technology,
is it all comes back to data.
And you pointed out again,
you pointed it out in your piece,
it's not just about connecting, it's about the data.
So let's talk about the data, the data model.
You've got edge, you've got core.
You've got this really increasingly complex
and elongating data pipeline.
You've got physics, you've got latency.
So what's your perspective on the data,
how that's evolving, and how organizations
need to take advantage of the data?
>> Dave, I think you nailed it.
It may come across funny because I work for Cisco
and we connect things, but if you think
about the first wave of internet,
the main purpose of the devices
and the way we were connecting them,
was basically for you and I to get access to each other,
to get access to the online data, to the online processes.
The main purpose we connecting IOT devices,
so that they can generate the data,
and then we can analyze that data,
turn these systems into solutions
to drive business outcomes.
So from that perspective we're actually seeing
a big shift in the sort of data model,
and it requires flexibility.
Traditionally, we talked about cloud, right?
In a cloud we usually see the use cases
that require a processing of a lot of data,
sort of in the batch possessing mode,
or for example if you want to connect
a bunch of vending machines,
you can connect them directly to the cloud,
because these machines actually send
only very few packets and they send them very infrequently.
Basically saying, "Hey, come on over
"and replenish a bunch of supplies."
But if you look at connected vehicle,
if you look at an oil rig, in the case of oil rig,
there's let's say a large one that has 100,000 sensors.
These sensors generate a couple terabytes of data per day.
You can't just send this data directly
to the cloud through the satellite connection, right?
You have to process the data on the oil rig
based on the policy coming from the cloud.
So from that perspective we've seen
that there's a need for a more flexible architecture.
We call it Fog Computing, which basically allows you
to have flexibility of extending the cloud
to the edge so you can process the data at the edge.
You can execute on the AI functions at the edge as well.
So that's one of the big architectural shifts
that we've seen with IOT as well.
>> Maciek, one of the opportunities
of new architectures has been to do a redo for security.
When it comes to IOT, though, there's a lot
of concern around that, because just the surface area
that we're gonna have, the devices.
Talk to us about how security fits into IOT.
>> Yeah, it's hard to talk about IOT
without mentioning security, right?
And we obviously seen over the last two years
a lot of press around IOT denial of service attacks
and so forth, and for me I think the silver lining
out of all of this news is that, first of all,
that we have seen the vendor community
finally taking IOT security seriously.
So all the security vendors are actually investing
in IOT security now appropriately.
We now working together as an industry on standards,
on interoperability, on sort of come on architectures,
even with the device vendors who traditionally
didn't pay much attention to security as well.
Sort of like what we did with wifi, you remember,
about 15 years ago but at a much greater scale.
So the vendor community's focusing on it,
but more importantly also the businesses
are moving from what I would consider sort of a...
I would say that kind of a denial.
Hoping that their plant is not connected
to the outside world and that it's secure.
Moving down now to the much more modern model,
which is basically a comprehensive architecture
working with are-see-sos, across the enterprise,
focusing on before, during, and after.
So IOT now is being integrated
into a broader security architecture,
and IT and OT are working together.
So yes, there is a concern, yes.
There are a lot of events hitting the news,
but I also think as an industry we're making progress.
>> Just to follow up on that,
Cisco obviously has an advantage in security,
because you go end-to-end, you guys make everything,
and you can do deep-packet inspection,
and that seems to be a real advantage here.
But then there's this thing called blockchain,
and everybody talks about how blockchain can be applied.
Where do you see blockchain fitting
into the security equation?
>> Yeah, I think that's a good question.
Maybe a bit more broader story,
I actually believe there's four legs
to this digital transformations tool.
There's IOT generating the data and acting on the decisions,
there's AI, there is the fog computing we talked about,
and the fourth tool is blockchain,
which basically allows us to make sure
that the data we're using we can actually trust.
At the high level blockchain,
people often confuse blockchain
and Bitcoin and cryptocurrencies,
but blockchain is an underlying technology
behind sort of the crypto,
that allows basically multiple parties
to write their transactions in a fast and permanent way.
But in the enterprise context, in IOT context,
blockchain allows us to actually come up
with very new use cases by looking at the provenance,
and looking at the data across multiple parties.
The data we can trust.
For example, the use cases such as counterfeiting,
there are use cases like food safety.
Like patient records.
Like provenance of materials.
So now we can enable these use cases,
because we have a single source of truth.
>> I want to ask you about disruption.
I like the mental model and picture
that you created before of a horizontal technologies,
and you kinda get vertical industries,
and it seems like, again I'm bringing it back to data.
We heard Super Mario at the host of the conference
say this was the largest digital transformation conference.
Which we laughed, like every conference
is a digital transformation conference.
But to us, digital transformation, digital means data.
And that picture you drew of horizontal technology
and vertical industries, it's all data,
and data enables disruption.
It used to be a vertical stack of talent
and manufacturing and supply chain within an industry,
and now data seems to be blowing that to pieces in digital.
You see Amazon getting into, you know,
buying Whole Foods in grocery.
You see Apple in financial services.
Others, Silicon Valley type companies,
disrupting healthcare, which we all know needs disruption.
What do you make of disruption?
It seems like no industry is safe.
It seems like Silicon Valley has
this dual disruption agenda.
Horizontal technology and then partnering within industries,
and everything is getting turned up on its side.
What do you make of it all?
>> Dave, I think you nailed it.
It is about and verus or, right?
When you think about companies, you mentioned Microsoft,
Cisco, Amazon, verus PTC or Rockwell, or Emerson and others.
10 years ago we sort of lived on a different planet, right,
and rarely these companies even talked to each other.
And now, even at this show,
these companies are actually showing joint solutions.
So that's precisely, I think, what we've seen,
which is technology competence coming from the Valley
and from traditional technology industry,
and then the vertical and market expertise
coming from these more traditional vendors.
At the end of the day, it is about technology,
but it is also about talent.
It is about skillsets.
It's about all of us pulling our resources together
to develop solutions to drive business outcomes.
So cloud, obviously,
was a very disruptive force in our industry.
But when you think about IOT,
just based on what you just said,
it seems to me given the assets, the resources,
the people, the plants, the equipment,
it seems like IOT is maybe somewhat evolutionary.
Not a completely...
It's a disruptive force in that's new
and that it's different, but it seems like the incumbents,
I mean look at PTC, their resurgence.
It seems like the incumbents have an advantage here.
What are your thoughts?
>> I think that if they play it right they absolutely do.
But it requires also a shift in mindset,
and I think we seeing it already, which is moving
from a vertical, one company does it all kind of mentality,
into the lets build an ecosystem based on open systems,
open standards, interoperability.
And that's sort of a shift I think we are seeing.
So for me, I think that the incumbents,
if they embrace this kind of a model,
they absolutely have a critical role to play.
On the flip side, the technology companies realizing
that they need to, it's not only about technology,
but it's also about partnering.
It's about integrating within legacy ecosystems
and the legacy infrastructure.
So each of the sides of the coin need to learn new tricks.
>> Okay, last question, is your initial thoughts, anyway,
on this event, some initial take aways.
I know it's early, day one, but you've been here.
You've heard the keynotes.
Final thoughts?
>> I think so far it's actually a great start to the event.
I have to say, what we've talked about already,
my biggest take away is to see,
and actually joy, is to see companies
from different walks of life working together.
You have robotics companies,
you have AI companies, you have industrial companies.
All of them are coming up with solutions together,
and that's basically what we want to see.
Is breaking the barriers and multiple companies
working together to move the industry forward.
>> And you're also seeing the big SIs are here.
I can see Accenture, I can see Deloid.
I know InfoSys is here, et cetera, et cetera.
So if they're here, you know there's
a lot of money to be made.
So Maciek, thanks very much.
It's really a pleasure having you.
Alright, keep it right there, everybody.
This is theCube, from LiveWorx in Boston.
We'll be right back after this short break.