IOT PLATFORM FOG COMPUTING FOR SYSTEM

Transcription

1 IOT PLATFORM FOG COMPUTING FOR SYSTEM INTEGRATORS BRIAN MCGLYNN VIDEO TRANSCRIPT Welcome! Who are you and can you tell me a little bit about what you do? My name is Brian McGlynn and I m COO of Davra Networks. Who are your customers and what vertical markets are you selling into? Our customers are system integrators and network value added reseller. We don t sell directly to end customers, we sell to system integrators. A network value-added research, what does that mean exactly? What do they do? Network integrators or system integrators, these are companies throughout U.S. and Europe, they have local knowledge on specific customers in their region so in the Midwest there are lots of wellknown system integrators like Net-Tech Corp. They would build traditional enterprise networks. Over the last years the likes of these network integrators would be building branch networks, MPLS networks and data centers but now they re struggling and they need to move into the IoT space. So we, as a data IoT platform, are helping those system integrators and buyers access this mar ket. What would be the difference between a system integrator and a VAR (Value Added Resellers) for example? They re very similar but I think it s classified that system integrators get a little bit more hands-on. So you re not selling directly to the customers but do you have any direct relationship with the end customer or not? From a technical point of view we would. The SI or system integrator would always be the lead so they know the customer very well, they know the IT directors, who brought in as part of an overall solution. So you don t just buy diverse platform, you always have hardware that s associated with the solution or service. The system integrator fronts everything and we re a piece of the overall solution of service that s delivered to the end customer. Can you give any estimate in terms of the size of that piece? I mean it is a network platform, is that what you classify your product as? Really an IoT platform. What percentage would that be of the overall? I know it probably runs over time but just roughly speaking, what would be the percentage in terms of overall investment that a customer would end up making through the system integrator? IOT-INC. 1 AUGUST 18, 2016

2 It really depends; we talk about verticals and solutions, it depends on the vertical, the solution, and the service. There is a lot of hardware involved and less is more just a bit of data, sensors. It varies from 20% up to 70%. That s interesting, that gives us kind of a little of a range then. So it s an IoT platform; describe what an IoT platform is. I supposed a good way to start describing an IoT platform, there s more and more coming out, probably if you benchmark against platforms that you ve heard of, today I d say one of the most wellknown in IoT platforms would be Jasper Jasper Technologies based just here in Mountain View. They ve been going since 2006, they ve raised over $200 million. They re built to be the forced IoT billion dollar company. They re really leading the way in this market. We re a little bit late to the game; we started in 2011, built our own IoT platform. Where Jasper focuses on is they have their platform, they sell it to the service providers. Same thing as you? Yes, very similar to us. There are just differences like they do a lot of billing whereas we don t do anything on billing. Their go-to market is through service providers. They provide their IoT plat form to service providers to build out solutions and services. Air plat form is targeted at system integrators and buyers. What a platform does is it allows service providers to offer these services and that specifically is we allow zero touch deployment, get these solutions out in the field, get these answers out, get these what we call IoT gateways 5:00 out in the field and collect all these data. When we re talking about IoT, we re really talking about big data so networks and data. At the edge, we collect all these data in what s called a fog. We collect all this data talking to different SCADA systems, telematics systems; collect data at the edge, do forced analytics at the edge, so not all the data is going up into the cloud. So we do forced analytics at the edge and we collect all the data, we start e fficiently then we take it up another level. We built application-specific to the use case. We make it very easy for system integrators to toy around a solution whether it d be connected farming or smart tractors or distributed automation in utility, transportation, connected roadways, so we make that data available and we have tools drag-and-drop applications just to build a very customized solution for our customers. Where does the system integrator come in? So they ve got your IoT platform and then where do they come in? What s their value add? The system integrator, they have the customers. They re there in the fields. Are they very specific to the verticals? Not really, it depends. Some resellers will want to focus on transportation; some resellers will be very focused on utilities but there s a lot of crossover in these verticals. For example you re talking to a large utilities company and you want to connect to distributed edge, these utility companies, they also have large fleets of trucks. You re the system integrator for this large utilities company, you re IOT-INC. 2 AUGUST 18, 2016

3 connecting up their edge at distribution network and also you can connect to their transportation network. So there s a lot of crossover. A lot of the integrators, they will look at multiple IoT verticals. You re saying they have the customer therefore they understand their network, they understand how they operate and then they integrate it within that environment? That s true. They also have to trust the customer, they know them very well, they know the engineers in there, and they know how they operate. But then what they also do is they front the solution. When I talk about solution, so I have this IoT platform but also do the gateway, so who do you get the gateway off? Do you get the gateway off the likes of Cisco systems? Do you get the gateway of BB Electronics or Intel? Who provides the gateway? Who provides the sensors underneath? I f you re talking about it provides telematics sensors, who provides those? In a solution, they system integrator could be working with five different companies in the back room to pull together sensors, gateway, platform. Who are the service providers? Are they going to go with AT&T, are they going to go with Verizon, 4G, or 3G? What the after sales service? Is it hosted on-prem? Is it hosted in the company s data center? Is it hosted on a WAS? Is it hosted on the system integrators private account? So there are all the things that they look after. All this kind of pieces, the customer doesn t really see. Let s swing it back to your company, how do you guys make money then? What is the business model? What do you sell exactly? We sell this platform that enables the SOS to bring the solutions to market. How we make money is it s a direct once-off license fee. There s a very specific reason for that and there s also a 20% maintenance charge. So you charge the system integrator? Yes. It s a once-off cost; we don t do SAAS because what we do is we allow the integrator to do. A lot o f the times the integrator will decide if this customer was in a saas model months ago and it s up to him. We keep a fairly simple and it works very well with the system integrators. Although it sounds very archaic, very old model 10:00 but it works very well because it goes through the. If you want to build scale in your business of CSPs it s one angle but SSIs, the likes of the Intels or the Ciscos of this world. And then they decide essentially on the business model that they present? Yeah, exactly. Let s talk about the customer and what are the costs then? If we re to have a checklist, what are the costs of the customer going into a project or going into a new Greenfield connected project? I suppose the best way to answer that is to try and take a walk for example. Maybe if you have the same cost, you really have to build in like what are they going to get out o f it really, I think they re very much related when talking about the cost. I ve talked to you earlier about the connected school bus. Who s the customer for the connected school bus? IOT-INC. 3 AUGUST 18, 2016

4 It s the school districts, independent school districts. You sell to the district and the IT director within the district. For using district as an example, what are they budgeting for? What are the costs going to be? I think it really starts at the business case level. What the schools are trying to do is really, these IT directors and I think about IoT, they business people think the likes o f the IT directors and the CEOs, they need to move over to the business. Are you implying that the IT folks are leading the charge versus the business folks? But they re moving towards the business because they see that the technology is so important for the business. You really need to bring the IT people into the business side o f things. in this independent school districts, the IT directors are leading innovation and technology in this schools so what they re looking at, most of these skills are connected very well, they have chrome books everywhere, they have ipads, they have WiFi everywhere. The common concepts of students learn anywhere, on the way to school, or on the way home from school, you re still learning. School bus can be a place of learning. This model is common and the IT directors are leading the charge in this. So the kids have their own devices and they come on to the bus and connect to the school s IT in frastructure. The kids can do their homework, they can read, they can open the latest news within the school so that s a strong business case for connecting of school buses. Also within school districts are talking about facility management. So if they can boost more students to this school, maybe they don t have to open up another school over here. They re just applying it because these buses, although they are spending more time in the school business, it s productive time, the students are still learning inside the bus. When we started this about 2 years ago, it was a very nice use case but also they have to justi fy the cost. So students are learning. So that s how you re justifying the cost? It s not so much about ROI, in terms of fiscal ROI but is more a value ROI. If you re saving in facility management as well there is financial ROI. But also the IT Director is trying to do, okay, we ve connected this bus, what else can we do? Is there anything else we can do? 15:00 Can we look at safety on the buses? Can we ensure the buses aren t going over speed limit? Simple things like that. Can we ensure that there is nothing wrong with the school engine? So looking at sensors, telematics inside the buses, collecting all that sort o f information, do location services for mommies at home and video camera securities, gunshot detection. There are a lot o f safety things for the parents. In some districts in Texas like the school kids around the buses for over an hour so it has a lot of value. I think you re right in what you re saying about the cost. It s not purely financial but there are other kinds of benefits. Extending the education and safety. Exactly. IOT-INC. 4 AUGUST 18, 2016

5 Those are the benefits, now if we look at that scenario, what would be the cost if they re going to have to incur for that? Per school bus basis or what s the business model that they come up against? It depends on how the Sis want to sell it but I look at the different pieces that are in current connected school buses are doing today, you start at the very bottom level the sensors are involved. These sensor boxes connect you directly to the engine of a bus. You get your speed, you get your idling, and you get any faults on the engine. So those boxes cost roughly $100 a bus. That s not much. The next level above that you need your gateway to connect you to the outside world so you need a 4G connection, WiFi connection so that s the hardware. Then the next level you obviously need your sim cards so you need AT&T or Verizon to have your data plan as well. Then we move up another level you need our platform to take sensor data, to make sure the network s always available. If the backhaul is gone or 4G, nothing s coming out of the bus and you need to manage the network and you need to manage the data. Then you need the on-going service and support from the SI as well. You need an electrical feeder that actually goes into this asset, whether it d be a bus or an oil rig, and he needs to get it out, he needs to take out his screw driver and get it out. That s a pretty important piece as well. It s a once off piece of work but it s very important as well. So they re all the elements and then you add them up and that s the price. Just out of curiosity, do you have rough range for what a per bus would be in terms of the cost? I think if you go on a per bus per month, depending on the services because there are di fferent services, you re looking at a range of $80 to $130. That would be on a five-year contract. And that s generally then the business model in this particular case the SI would approach on a per bus per month? Yeah, that s specifically for transportation and to connect the school buses. There are a lot in connected transportation but they re more looking at kind of fleets and they would be in a range of $40-$60 per month per vehicle. So this connected school buses is a little bit more advanced. IOT-INC. 5 AUGUST 18, 2016