TRANSFORMING CONTAINER AND INTERMODAL OPERATIONS WITH M2M/IOT CONNECTIVITY
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1 TRANSFORMING CONTAINER AND INTERMODAL OPERATIONS WITH M2M/IOT CONNECTIVITY Container Owners Association (COA) Rotterdam, Netherlands November 14, 2016
2 FORGET TRUMP.
3 108 YEARS.. The system will need to monitor 30,000 reefer containers
4 AND IRELAND BEATS ALL BLACKS
5 TODAY S DISCUSSION State of the industry Current technology Adoption to date Trends for the next 5 years 5 things to consider now
6 IOT AND THE CONTAINER SUPPLY CHAIN TODAY Dumb, dark and disconnected cargo and assets Little real time visibility and control over cargo and assets are the rule No meaningful hard data for more real time operations Increasing business complexity Regulatory, security and other issues increase the complexity of cargo and asset management Operational issues such as trans-shipment resulting in longer transit times/more hand-offs Alliances/VSAs are resulting in higher cargo and asset operational complexity and risk 25 carriers and their shipper clients exposed to Hanjin collapse Slow rate of industry technology adoption BCO adoption has been consistent but data is mostly defacto...data-loggers Shipping lines slow to adopt telemetry technology or at minimum share data when available Maersk is a leader Tough ROI is the rule and fleet sizes inhibit adoption
7 THE ROLE OF M2M/IOT Smart cargo and assets equipped with wireless M2M/IoT technology report on asset location, condition and other data to cloud or private networks for real-time visibility by contaioner supply-chain stakeholders
8 IOT SOLUTION STACK Purpose-built M2M/IoT SaaS app For solving a specific business requirement Vendor host applications Application platforms for business operations DeviceCloud Device management for supported devices Network management Connectivity management for wide and local area networks A P I End users BI tools, ERP systems, 3 rd party SaaS applications Parsed device data Unparsed data Devices Satellite, cellular, RFID, Bluetooth enabled hardware
9 VISIBLE, SMART, CONNECTED Maersk Line has over the past years equipped more than 270,000 refrigerated containers or reefers with Remote Container Management (RCM). This technology allows us to track in real time the exact position of the container, its temperature and humidity and potential off service. We went live operationally in Q but are already seeing potential for the wealth of data available. RCM enables greater visibility over cargo, and more importantly, a significant reduction in damaged cargo. Vincent Clerc, Chief Commercial Officer, Maersk Line
10 M2M/IOT IS GOOD FOR ALL STAKEHOLDERS Shipping lines want M2M/IoT data for greater operational control/maintenance and repair data BCOs want box location and cargo temperature data Lessors want box location and potentially impact data OEMs want equipment performance/m&r data Freight forwarders/logistics/ gov t entities want box location, security status
11 M2M/IOT IN THE CONTAINER SUPPLY CHAIN Security Visibility Automation Regulation
12 SECURITY Cargo theft Illegal human transport Terrorism Drugs and weapons smuggling Tax evasion
13 VISIBILITY Asset availability and positioning Congestion mitigation and traffic management Advanced decision making
14 PROCESS AUTOMATION Labor costs Efficiency Predictive M&R Power consumption Equipment handling Safety
15 REGULATORY CARB compliance for gensets Chain of custody for pharmaceuticals FSMA and EU require compliance for temperature controlled goods C-TPAT compliance
16 REALITY OF M2M IN CONTAINER SUPPLY CHAIN Reefers Approximately 300,000 of 1.5 M reefers Dry Approximately 30,000 of 12 M dry containers Chassis Limited adoption Tanks Approximately 5,000 of 400,000
17 M2M/IOT TECHNOLOGY OPTIONS TODAY BCOs now have GSM/satellite tripbased sensors and telemetry devices Bluetooth Low Energy (BLE) is emerging quickly Shipping lines will accelerate adoption of M2M permanently installed in assets Devices in reefer and on genset Vessel-based GSM with satellite backhaul of data Container OEMs will offer fullyintegrated solutions
18 A POSSIBLE FUTURE WORLD Dual-mode device attaches to door exterior BLE temp sensors mounted throughout container or in cargo BLE antenna wired through container door and mounted on interior BLE door and security strap BLE sensor data captured by phone app, or transmitted via GSM/satellite Device installed by shipping line
19 CASE STUDY REEFER MONITORING The Challenge The world s largest container shipping line, Maersk, wanted to significantly reduce costs and improve performance of reefer operations The Solution Deployment of 285,000 telemetry devices to all reefers in Maersk Line fleet Establishment of global monitoring center Business analytics tools to optimize operation The Results Reported cost savings in PTIs, realignment of manual monitoring contracts at terminals, reduced claims Commercial launch announced for mid-2017, data to be shared with shippers
20 CASE STUDY INTERMODAL The Challenge Beyond container tracking leading US intermodal carrier, Hub Group, wanted to accelerate asset turnover The Solution Deployment of 35,000 53ft intermodal containers with integrated cargo sensing When empty, an automated call is made to retrieve the container Truck dispatched to pick up The Results Hub Group significantly reduced container pick up time and moving asset turnover We can actually be a lot more proactive. It should help reduce container dwell times by at least a half a day. Dave Yeager, Chairman, CEO, Hub Group, Inc.
21 CASE STUDY CARGO SECURITY The Challenge Provide continuous cargo security and accelerate border crossing time for automotive clients of Mexican-based freight forwarder The Solution Electronic seal applied to each load at factory to provide truck position and security status; data fed to EXL monitoring station C-TPAT bolt and Green Lane program allows fast track entry to USA The Results Reduced transit time from 2.5 to 1 day Eliminated transit fees resulting in 150K per year savings Reduced claims to $0
22 5 TRENDS TO BE AWARE OF 1 iphone versus Android Shipping lines purchase containers and presumably technology from multiple vendors we must assume a heterogeneous technology world 2 New technologies driven by the commercial and wider business market will constantly change the game and bring scale and reduced costs GSM and satellite costs are down BLE sensor technology is very low cost and a prevalent technology in smart phones already 3 The Iron Throne problem M2M vendors want their technology to become the industry standard this is both unrealistic and naïve and commercially not viable reject it 4 New pricing models based on SaaS will make technology more affordable 5 A growing focus on middleware to resolve heterogeneous devices, networks and apps
23 MIDDLEWARE NIRVANA? Network management Business analytics Cloud-based vendor applications Device cloud management middleware Cloud-based BCO and shipping line applications Device management Mobile phones GSM devices Temperature and other sensors Passive and active RFID Satellite devices
24 5 RECOMMENDATIONS FOR BUYERS 1. Business complexity is increasing pressure for technology. To gain next mover advantage firms should develop an M2M/IoT strategy. 2. Understand what is available, examine your technology options new possibilities with BLE, satellite.and avoid proprietary technologies. 3. Build your ROI case but expect a change in business processes to drive it. 4. Understand how you will integrate and manage big data do you have a middleware platform? 5. Create new operational processes to reflect benefits of technology and protect against market interruptions.
25 FOR MORE INFORMATION Contact me: Michael Dempsey VP, Sales Container and Port Solutions ORBCOMM
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