Internet of Lights Blog

The Importance of Strategic Legal Thinking: Hints from Echelon’s Chief Legal Officer

In this special edition of IIoT Talks, we look inside for inspiration: We talk with Alicia Moore, Echelon’s Senior Vice President, General Counsel and Secretary to the Board. 

Alicia Moore, SVP, General Counsel, Echelon Corp.

Throughout her career, Alicia has provided strategic legal advice to both public and private technology companies across a variety of industries. She has a distinctive perspective on how legal issues can be important for companies following any technology business path in general, and for navigating the Industrial Internet of Things (IIoT) space in particular.

Wendy Toth: You often talk about the ‘positive’ aspect of legal decisions. What do you mean by that distinction?

Alicia Moore: Many people seek legal counsel once they realize that they are in trouble, or to document a deal long after the negotiations have been underway and the parties’ respective positions have been hardened.   While that’s certainly one aspect of legal advice, it misses out on broader, more strategic and positive benefits that timely counsel can bring.

For example, if counsel is involved at the front end of discussions, it’s possible that the transaction can be structured to bring additional benefits to one or both parties on matters outside of the discussions, such as tax implications, ease of enforcing provisions or limiting unnecessary liabilities.  I’m especially passionate about the potential for legal considerations to positively affect relations between the parties, and to enhance a company’s overall business success.

TOTH: Can you make the connection for us between the law and the IIoT?

MOORE: The IIoT includes the convergence of billions of existing industrial devices—long-lived, ultra-reliable, pre-Internet operational technology (OT)—with the latest information technology (IT) advances in the areas of networking, cloud computing, big data and more. As the OT and IT converge, it raises many issues, including those around privacy, security of information generated and shared, allocation of responsibility for protecting and maintaining information, liability allocation across the supply chain and a variety of suppliers, and ensuring that the end result conforms to all applicable laws and regulations.

Legal strategies should be a key aspect of discussions about how to propagate, maintain and control the increasing interconnectedness of devices, in both industrial and consumer settings; and how to bridge the dynamic features and functions offered by large companies and small startups.

TOTH: How does the technology convergence affect the convergence of legal issues?

MOORE: In the hyperconnected and interconnected world of the IIoT, achieving the fastest possible time to volume, securely and reliably, means carefully sorting out the complex legal agreements involved among all the various types of devices, technologies, connections, supply chains and distribution channels involved.

There are a number of legal issues that many companies might not be considering as the world becomes more interconnected, but to which I believe they should be paying attention—and those companies that think through the alternatives and consequences in advance will be at a competitive advantage.

TOTH: Can you give an example?

MOORE: Sure. Companies need to explore how their go-to-market strategy affects their choice of partners. It is unlikely that any business can address all of its prospective customer needs with its own internal solution. Devices and services are deployed in larger systems, disruptive features can be created by niche players, and sales can take place through various channels. 

Legal considerations affect and may ultimately determine with whom you choose to partner, which sales and distribution channels you will use, whether you own or license your offerings, how you plan to capture and grow your market, how you manage your ROI, and even what your key value proposition is. I believe that taking these and other factors into account as you plan and execute your attack on the marketplace is imperative. 

TOTH: How does legal strategy affect business strategic planning?

MOORE: Decisions made today might restrict the decisions you can make in the future. For instance, a decision to offer software as open-source might facilitate market adoption, but it might also eliminate the ability to block future competitors or control the evolution of your products. Entering into strategic arrangements with one party might elevate your company’s profile and revenues, but it could also prevent relationships with others. A company that builds its service business on the advantage of having no upfront capital expenditures might have difficulty later shifting to a model requiring significant hardware purchases for add-on services.  A business that builds its core value proposition on designing and building all its products in-house can find it challenging to later outsource production to save costs.

And all these considerations become more complex as companies rely on other companies for critical aspects of their development, manufacturing, sales and service.

TOTH: We automatically think of legal issues when dealing with patents, but you take a broader view of intellectual property issues, don’t you?

MOORE: Yes. The goodwill you can generate as you build your brand assets results from your choices about how you define what you want to retain as your intellectual property across the landscape of not only patents, but also trademarks, designs, copyrights and trade secrets, as well what you are willing to ‘give’ to the market to proliferate a standard or expand market share.

How you build your intellectual property assets also matters: What do you create yourself and what do you outsource? How much control do you retain over the exclusivity of which parts of your offering? What do you patent, and what do you publish? What is the best balance for your particular company between protecting intellectual property assets and accelerating your market footprint or adoption of your technology or products?

Decisions around intellectual property assets also affect the parameters of the relationships you can create. And again, the decisions made here cannot always be reversed easily, if at all. Once your inventions become public, it may be difficult to control derivative developments and retain your competitive differentiation.  Once you’ve chosen a particular partner, it may be difficult to form strategic relationships with that partner’s competitors.

TOTH: For startups in particular, how do legal strategies affect exit strategies?

MOORE: Startup companies usually assume that their exit strategy options are to go public or to be bought. But in between the two, there are steps about how you position your growth in the marketplace, how you define your value proposition, how you establish your intellectual property and key differentiation, and how you capture and maintain your market position—all of which enhance the likelihood of successful business growth (and exit).

Tactics related to strategic partnerships, such as augmenting feature sets through joint development opportunities; channel strategies; how you approach your financial backing and manage your financial position, all support the success of your strategy. In a dynamic and converged market such as the IIoT, with a few big players and many niche companies, how you identify your exit strategy will affect the key steps you can and should take along that path.

TOTH: What else do you suggest that companies keep in mind about partners?

MOORE: Remember, you will be affected by the fortunes of your partners. You can’t predict the future, of course, but one of the most important aspects of strategic legal thinking is to extrapolate possible future scenarios based on current conditions and characteristics. At the very least, good strategic legal thinking can help you refine your decisions about whether a particular company might make a good partner for your company, and to structure the agreement for the best chance of success for both entities.

In this interconnected world, no one can make it alone. Understanding when, how and with whom to partner, contemplating the legal ramifications of the deal, and documenting the relationship in clear terms, might make the clear difference to your future.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

 

Part 2 with David Stephenson, Leading IoT Strategist: Landscape, Opportunities, and Misconceptions of the IIoT

In part 2 of our discussion with David Stephenson, owner of Stephenson Strategies and a leading Internet of Things strategist, we talk about the lay of the land in the IoT, as well as some opportunities and misconceptions around the IIoT in particular. Don’t miss part 1, where we covered IoT attitudinal shifts and the power of access to real-time networked data.

David Stephenson

Wendy Toth:  What do you see as the overall lay of the land in the Internet of Things?

David Stephenson:  I recently came across the Moor Insights & Strategy report on Segmenting the Internet of Things. I agree in general with the four quadrants they have in there [Monitoring, Attainment, Operational, and Life]. I also think there’s some really interesting potential for a connection between the four segments of that grid.

 

TOTH:  What’s an example of that kind of connection?

STEPHENSON:  One really neat example is in building automation. An indoor lighting system networked to carbon monoxide sensors can be programmed so that if the carbon monoxide sensors detect a dangerous level of the gas, the lights will blink red constantly until everyone leaves the building. This is a relatively simple example that can literally save lives.

Another example is in the railroad industry, which I love because railroads are so symbolic of 19th century industry. But now you have railroad companies putting sensors every few miles along the track bed. One of the problems with trains is that when the bearings on a rail car lose lubrication, the bearings heat up and can actually start a fire and lead to derailments and incredible costs.

These sensors in the track can detect excess heat in the bearings. By detecting early signs of overheating, they can take that particular car off and service it at the next scheduled stop instead of waiting to find out when the train derails.

Then, if you take that example to the next step, you can imagine the application of what’s called ‘smart dust’: sensors incredibly cheap, and powered by ambient energy sources, so they can be strewn all over the place. As the price of sensors comes down, railroad companies plan to put sensors on every single wheel of every single rail car, so they get data about rail car health immediately, without that gap of a few miles between sensors.

TOTH:  What do you think are some of the biggest opportunities in the Industrial IoT?

STEPHENSON:  There’s this idea of being able to see everything that has happened in a way that you couldn’t before and to optimize the precision of industrial operations. Particularly with M2M [machine-to-machine] processes, where there’s no human interaction, a change in one part of the production process will automatically trigger adjustments farther along. I think this is going to lead to unprecedented precision and economy in the manufacturing process.

TOTH:  What are some of the biggest misconceptions about the IIoT?

STEPHENSON:  Yes, sensors are going to continue to go down in price. And yes, a lot of the things you’re working on will become even more precise over time. But people should not be deluded by the idea that they should just wait until all of this is really optimized to get into the IIoT.

The technology is sufficiently advanced now, particularly when it comes to manufacturing. You really should launch initiatives now to optimize your current processes. That will give you the experience of dealing with the IoT, dealing with this explosion of data, dealing with the benefits of predictive analytics. Then you can build on that base to make fundamental changes in the future. 

But my big message is: Don’t wait! Don’t wait for everything to be fully in place, because you can enjoy so many benefits right now.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

Part 1 with David Stephenson, Leading IoT Strategist: Shifts in Attitude & the Power of Real-Time Networked Data

In part 1 of our discussion with David Stephenson, owner of Stephenson Strategies and a leading Internet of Things strategist, we talk about IoT attitudinal shifts and the power of access to real-time networked data. In part 2, we’ll cover the lay of the land in the IoT, as well as some opportunities and misconceptions around the IIoT in particular.

Wendy Toth:  As someone who has recently been named one of the IoT’s global thought leaders, what’s your take on how we should be thinking about the IoT?

David Stephenson, owner of Stephenson Strategies

David Stephenson:  First of all, the IoT is equal parts technology and attitude shifts. One of the things about the IoT is that it runs contrary to many, many years of ingrained management attitudes. That’s my niche in this area: this attitudinal shift and what it requires from participants in the IoT.

TOTH:  Can you talk a bit more about the nature of this attitudinal shift?

STEPHENSON:  In the past, we all had this great belief that the secret to success in technology industries would be to create a proprietary system and make customers entirely dependent on us. The only firm I know of that has been able to pull this off in current times is Apple, and I’m still astounded that Apple’s been able to do that. The whole trend at this point is this shift toward open data and sharing and collaboration.

We need to start asking entirely new questions—whether it’s about behind the firewall or in conjunction with your supply chain or your distribution network or directly with your customers—regarding who else can use your data. And that is a remarkable shift. 

TOTH:  What do you think will be the magnitude of this shift?

STEPHENSON:  I’ve heard Echelon CEO Ron Sege talk recently about network effects, in the application of Metcalfe’s Law to the IoT. And I think he’s right, except he might be being too conservative. I think there’s almost unlimited potential for network effects when it comes to the IoT, largely because of this unprecedented level of data sharing.

And I think the potential for transformation is particularly important in the Industrial IoT (IIoT), where there’s finally a possibility to overcome what I refer to as ‘collective blindness’ about anything we simply can’t observe and document, particularly not in real time. Suddenly, that blindness has been lifted with the IoT and IIoT.

TOTH:  Can you give an example of what you mean about the lifting of collective blindness?

STEPHENSON:  The manufacturing sector and factory automation present lots of examples.

Until very recently, someone in manufacturing plants would walk around the factory with a clipboard writing down readouts from the dials and gauges on various pieces of equipment. That was as close as you could come to getting information about what was actually happening on the assembly line. 

Contrast that to sophisticated manufacturing plants today, where the assembly line is equipped with thousands of networked sensors. Now, a manager walks around the factory with an iPad and has access to data from all those sensors, simultaneously and in real time. 

TOTH:  What can be done with that real-time data?

STEPHENSON:  To start with, you can use the data to optimize production in ways never before possible. But the possibilities beyond production optimization are especially exciting.

When you have real-time access to the data from your assembly line, you can share it with your supply chain and your distribution network. This is making possible what I call the era of precision manufacturing. You can eliminate waste and streamline production.

I think it could even be a key to helping ensure jobs. Think about it. If you can share that kind of information on a real-time basis with your supply chain, doesn’t it makes sense that you would give preference to a supplier who is within an hour from your factory, as opposed to someone in China—where even with real-time information it’s going to take weeks to send you something?

So I’m very optimistic about the job creation potential with this kind of precision manufacturing, which is a direct application of the IIoT.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

 

Part 2 with Menko Deroos of Xicato: Why Quality of Lighting Matters

In part 2 of our discussion with Menko Deroos, CEO and Co-Founder of the innovative lighting company Xicato, we talk about the importance of quality of light to the IoT and Industrial Internet of Things (IIoT) markets. Don’t miss part 1, where we covered the Internet of Lights, Lighting 2.0, and how they relate to the Internet of Things.

Wendy Toth:  What is ‘quality of light’ and why is it important?

Menko Deroos, Xicato

Menko Deroos:  There’s a human need for good quality of light. Good quality light shows colors correctly and is consistent from light source to light source. What’s interesting is that people don’t notice quality lighting but they do notice poor quality light. In addition to the light itself, lighting shouldn’t flicker or take time to come into full brightness.

Beyond the human need, there’s also a real business reason for good-quality lighting, especially in markets such as retail, hospitality, and medical facilities. The great thing about LEDs is that while their energy efficiency is very good and gets much of the attention, it’s their quality of light that is just as impressive.

TOTH:  What’s the role of quality of lighting in the Industrial Internet of Things (IIoT)?

DEROOS:  Let me take the retail market as an example. With sales increasing through the Internet, brick-and-mortar stores have to rethink what their image should be. They need to figure out what they can do to help attract people who walk by outside to enter the store. Then, they need to improve the experience of customers in the store so they’ll stay longer and make purchases.

For that reason, lighting is playing an increasingly important role in creating that experience. If you have good lighting, you can directly affect sales. If you’re using LED-based lighting, the light can be engineered for optimum impact and effect. As a result, retail stores are moving away from the conventional lights and moving toward LEDs.

LEDs also allow you to make lights into nodes on an IIoT. You can have entire shopping malls or large stores where LED lighting is improving the retail experience through the quality of light as well as the analytics and communications capabilities enabled by the IIoT and associated applications. The retailer not only has the ability to save money, but also the opportunity to sell more.

TOTH:  What about quality of lighting in the medical market?

DEROOS: Lighting has an impact has on wellbeing how we feel, behave, and our overall health. As a result, the impact of lighting on health is a topic of significant research.

Care facilities for example, want to ensure that doctors and nurses see colors, like skin tones, correctly. Visual examination is an important part of the diagnostic process - a particular color on the skin might be an indication that something is not right.

In that very practical example, the quality of light has a direct effect on the quality of medical care provided.

TOTH:  I imagine that once a market switches to LED lights for either energy efficiency or quality of light reasons, they are then candidates for Internet of Lights applications?

DEROOS:  Absolutely. To go back to our retail example, say you have all your LED lights networked and able to be digitally controlled. You can enable them all with Bluetooth capability, so you now have access through your wired communication to every single light through Bluetooth. You can use that Bluetooth channel to communicate with people using their phones or smart wristwatches or whatever communications devices they have, to offer promotions or alerts or other information that might appeal to them.

In hospitals that have networked lighting, they can now keep track of carts of medical equipment and monitors, which is often difficult to do in a busy hospital. And sometimes they just disappear. Being able to locate a specific art within inches in real time provides immense value to those hospitals.

TOTH:  It sounds like you see quality of light as an important gateway or entrance to the Internet of Lights.

DEROOS:  That’s a great way to put it. Quality of light is hard to spec, but we’re getting better at it. And people are becoming more educated and aware of the difference between poor and good quality of light.

It doesn’t matter whether people choose LED lighting for their buildings for energy efficiency or longevity or quality of light reasons. The point is, once the LEDs are there, the lighting become an asset in the building rather than a consumable. And then, you have the potential for adding a control network and establishing an Internet of Lights.

From there, you can start adding real value. You can increase retail sales, improve healthcare in hospitals, help passengers navigate airports more efficiently, and provide new levels of personalized services in hotels and restaurants. The Internet of Lights is a real paradigm shift. You can help save energy while improving the experience with the best quality of light in the world and then add these new levels of value. It’s very exciting.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

 

Part 1 with Menko Deroos of Xicato: Internet of Lights and Lighting 2.0

In part 1 of our discussion with Menko Deroos, CEO and Co-Founder of the innovative lighting company Xicato, we talk about the Internet of Lights, Lighting 2.0, and how they relate to the Internet of Things. In part 2, we’ll cover the importance of quality of light to the IoT and Industrial Internet of Things (IIoT) markets.

Wendy Toth:  By now most people are familiar with the Internet of Things (IoT). But what is the Internet of Lights?

Menko Deroos, Xicato

Menko Deroos:  The Internet of Lights is an enabler of the Internet of Things. In addition to performing the lighting function, the communications electronics and networking are integrated with the ubiquitous light fixture.

TOTH:  What’s the difference between the Internet of Lights and Lighting 2.0?

DEROOS:  The Internet of Lights is something you can actually touch. Lighting 2.0 is a state of the lighting industry. It’s hard to touch. Lighting 2.0 describes the current generation of lighting that is displacing analog bulbs with digital LEDs. Lighting 2.0 refers to this digital revolution and all the functionality that can now be integrated into lights.

Lighting 2.0 represents a paradigm shift in the lighting industry. The essence is that IT meets lighting, with tremendous value created in that meeting. Lighting is not purely an electrical engineering space any more. It’s extended above and beyond in a similar fashion to how the phones of today are not just phones any more. You still need phone capability, but it’s no longer the only functionality it provides. The same thing is happening with lighting.

TOTH:  What’s the relationship between the Internet of Lights and the Internet of Things?

DEROOS:  As an enabler of the IoT, the Internet of Lights adds new communications capabilities. Think of it this way: In the Internet of Things, say your refrigerator at home, or a piece of equipment at a factory, is connected to other devices in other locations. Now, you can do the same thing with the lights. You can track and control the performance of those lights, but you also have the additional communication capabilities in these lights to connect with all kinds of devices.

From a practical perspective, a crucial aspect of the IoT or the Internet of Lights is communication. Changing an already built environment to add two-way communications capabilities can be expensive and difficult. But lights already have two wires that power them, and lights are ubiquitous wherever there are people. People turn on the lights to see. The Internet of Lights therefore leverages proven, time-tested wiring to enable this new generation of communications capabilities.

To put things in perspective, today there are more than 10 times more light sockets in the world than there are phones. So in our view, the Internet of Lights is one of the largest, if not the largest, networks in the IoT.

TOTH:  Wow, that’s amazing to realize there are so many more lights than phones out there. It makes you wonder why people aren’t talking more about the Internet of Lights.

DEROOS:  That’s true. And there’s actually another dimension to the lighting growth story. Over the last century, the world has used more photons every year. Even with technology that’s more energy efficient—and historically, every lighting technology introduced has been more energy efficient than what it replaced—the world still needs more photons. More buildings are being built, more land area is being converted into built environments, so we simply need more lights. And more lights means more potential nodes for the Internet of Lights.

TOTH:  The consumer IoT is primarily associated with wireless communications, whereas lighting has relied on wired media. Do you see the Internet of Lights evolving to wireless?

DEROOS:  I think if you do it right, you will have both. You can have a wired communications system that is super secure and reliable, and on top of that you can add wireless communications capabilities that allow end users to access whatever services they want to consume in that space. And that’s really what I like about the combination of Echelon and Xicato solutions. You can provide a very secure, solid wired communications system plus add wireless capabilities. I think this provides tremendous value to the marketplace.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

 

Part 2 with Jesse Foote of Navigant Research: Challenges and Future Promise of Networked Lighting Control

In part 2 of our discussion with Jesse Foote, Senior Research Analyst for the market research firm Navigant Research, we talk about some challenges facing lighting control as well as the future of networked lighting. In part 1, we discussed the lighting industry and its intersections with the Internet of Things (IoT).

Wendy Toth:  What are some of the concerns people have related to lighting control and the IoT or Industrial IoT (IIoT)? 

Jesse Foote:  Cyber security arises as an issue as more people become aware of the capabilities of network control systems. Privacy concerns in general are on people’s minds right now, with all the recent NSA revelations. The lighting controls industry will need to ensure that adequate protections are built into their systems from the outset, then make sure that people know that the lighting industry is addressing these issues. People need to believe that systems are secure, so that cyber security and privacy concerns don’t derail the broader adoption of lighting controls.

TOTH:  Who has the responsibility of calming those security and privacy concerns?

FOOTE:  I’m not sure there’s a good answer to that question, not yet. Certainly the vendors of lighting controls need to make sure that security is built into their systems. Whether vendors build it in themselves or team up with partners, and whether standards will be put in place, I hope so. But I think it’s still an open question. 

Maybe another open question is how it gets communicated to the public, and who is responsible for that. Will vendors take the lead in making sure public concerns are addressed, or will it be the ones deploying lighting control systems — the big companies, cities, and municipalities — that really have to prove to their end customers and residents that the systems are not going to be abused?

TOTH:  You mentioned cities. What are some of the demands and constraints that they have when it comes to networked lighting controls?

FOOTE:  If we’re talking about cities, we’re talking primarily about street lighting. LED street lighting has been more widely deployed than control networks for street lighting.

Part of the reason is that control features add to the cost of lighting systems, and some cities are looking for the cheapest possible LED luminaires. It’s hard for them to justify adding things like dimming, which cost extra. But the cost difference is coming down, and it’s my understanding that more lighting manufacturers are including dimming capabilities into their luminaires.

Another challenge holding back the adoption of network controls by cities is the problem of outdated municipal codes. A big benefit of networked lighting control is the ability to dim and shut lights off when they’re not needed or when they don’t have to be at full brightness. But municipal codes haven’t really caught up with that concept, so you run into liability issues, or at least the concern about liability, if there’s a potential safety issue in not providing adequate light to streets. I think the safety issue can be addressed with smart lighting control systems, but the codes need to catch up so that city managers are comfortable adopting those systems.

TOTH:  On a related topic, what’s happening with standards for lighting control?

FOOTE:  The lack of relevant standards is another thing slowing adoption of lighting controls by cities. One big recent development was approval of the NEMA (National Electrical Manufacturing Association) socket standard, which allows a plug-and-play photocell to be put on top of an existing luminaire. This enables not only control over whether that light turns on and off, but also control of the dimming state. Dimming is a key feature of networked intelligent control in street lighting systems.

With the NEMA standard, even if a city doesn’t buy a control system right off the bat, it’s relatively easy to add those controls later. I think that’s a potential big benefit and boost to adoption of controls for street lighting over time.

TOTH:  What about the question of whether cities should use wired or wireless connectivity for networked street lights?

FOOTE:  For street lighting, the norm has been to use wireless in the U.S. and U.K. and wired in the rest of Europe and most of Asia. That’s largely because of the way substations are set up in the different geographical areas.

I think the developments Echelon has announced to control systems that can use both wired and wireless connectivity should help quite a bit. You can use whichever wired/wireless combination makes sense for an individual system, and you get the best of both.

TOTH:  Do you have a vision for where you think networked lighting controls and the IoT are headed in the future?

FOOTE:  There’s a growing expectation that you ought to be able to see the status of things on the Internet and be able to control them remotely. That ability is happening in more areas of our lives, so the thought is, why shouldn’t we be able to check whether lights are on, or turn them on and off remotely? On a personal level, why shouldn’t I be able to pull up an app on my phone and control the lights in my house? The growing expectation that this capability will extend to more and more devices will actually cause it, in part, to come true.

Another piece of the future will be open platforms, so that various parties can find creative new uses for the information collected by the lighting networks. It’s similar to how third-party app developers write software for smartphones. Open platforms that allow third-party software developers to come up with new uses for the information gathered by outdoor or indoor lighting networks will really expand the possible uses for that information.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

Part 1 with Jesse Foote of Navigant Research: Intelligent Lighting and the Internet of Things

In part 1 of our discussion with Jesse Foote, Senior Research Analyst for the market research firm Navigant Research, we talk about the lighting industry and its intersections with the Internet of Things (IoT). In part 2, we’ll cover some challenges facing lighting control as well as the future of networked lighting. 

Jesse Foote, Senior Research Analyst, Navigant Research

Wendy Toth:  What’s your perspective on the IoT?

Jesse Foote:  Everybody seems to have a different viewpoint on the IoT. In my market research, I focus on efficient lighting and lighting controls, so I come at the IoT from the lighting side of things. I’m looking at the range of possibilities of other devices that can be networked together once you have a networked lighting control system in place. 

As for the IoT in general, it seems a lot of people are getting burned out on that term. I think that’s mainly because for many years there have been predictions and speculation about an explosion in the number of devices connected to the Internet, as well as talk about how everything in our lives will become interconnected and smart.

The Industrial Internet of Things (IIoT) is a hotter topic now than the rest of the IoT. People see the IIoT as more concrete and happening in ways that are directly relevant to everyday life.

TOTH:  There’s a lot of talk about lighting systems being ‘next generation.’ How do you define a next-generation lighting system?

FOOTE:  For a while, we used the term ‘intelligent’ — but you run into a problem of definition. What is an intelligent lighting control system versus one that’s not intelligent? The dividing line I tend to use is simply networked capability. Can the light be seen and controlled via the network? That definition avoids the problems of determining whether the intelligence should be built directly into each light fixture or if more of the intelligence should reside on the network.

Once you cross the threshold of lights (or other devices) that can be seen on the network, and that a manager can control via the network, you open the range of possibilities that fall under the IoT category.

TOTH:  So do you see the IoT being installed almost as an incidental side effect of deploying a networked lighting system?

FOOTE:  Absolutely. Lighting controls are helping to break ground for that broader range of IoT applications, especially in conjunction with upgrades to LED lighting. In those cases, the marginal costs to also add controls is fairly low. Then once you have controls, why not do other things with them?

TOTH:  For this trend, are you talking about indoor lighting or outdoor lighting, or both?

FOOTE:  With outdoor lighting, whether it’s public street lighting or commercial parking lots, people are already making the connection that once you have a network of controlled lights, there are many more things you can do with them.

For indoor lighting in commercial buildings, that awareness is dawning a little more slowly. In large buildings, HVAC systems have been centrally managed for a while; that happened earlier than centrally managed lighting control systems.

At the moment, there’s a bigger range of exciting add-on features with outdoor lighting than indoor lighting. The growth from networked lighting control to networking other devices in an IoT scenario is happening faster with outdoor lighting.

TOTH:  Why do you think there’s less appeal to extending indoor lighting networks to IoT types of applications?

FOOTE:  Integration with existing systems is part of the problem. I ask lighting control companies all the time if their systems can interact directly with a broader building management system (BMS). They always say yes — or, yes, we could write the code to do that interaction. But when I ask them if customers are actually interconnecting those systems, the answer is that almost nobody is.

Right now, the norm is to have two separate control systems in buildings: one primarily for HVAC and a separate one for lighting. It seems logical that those two will eventually come together, but the fact is that right now they are separate.

TOTH:  What would entice building owners or managers to integrate those networked systems?

FOOTE:  One would be the argument that in terms of costs, it doesn’t make sense to have two networks and two sets of sensors. I’ve seen buildings where there are two separate occupancy sensors literally sitting side by side, one to inform the lights and one to inform the HVAC system. That’s an obvious overlap that is wasting equipment expense, plus the time for installing and managing it.

You might think that the cost argument would be enough to push the integration issue, but there also has to be an easy option for building managers to control both systems. At the moment, it’s easier for them to look at two separate control panels than to try to hack the two systems together into one.

To have the incentive to combine those separate systems, they’d need to be enticed with additional features and ease of use and management. One thing that might accelerate it is an enterprise-level solution that allows building managers to look at multiple buildings at the same time. I think as more people adopt that sort of strategy, the benefit of tying the HVAC, lighting, and other systems together within individual buildings will become more compelling.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

Part 2 with Jeffrey Kaplan: IoT and Cloud Hot Buttons and Concerns

In part 2 of our discussion with Jeffrey Kaplan, Managing Director of the strategic consulting company THINKstrategies, we talk about some hot buttons and concerns regarding the Internet of Things (IoT) and the cloud. Don’t miss part 1 of our conversation, which covered the relationship between cloud computing and the IoT. 

Wendy Toth:  When you go out and talk to people about the IoT and the cloud, what are some of the hot buttons you hear, the things getting people the most excited about the intersection of these two trends?

Jeffrey Kaplan:  First and foremost is the accelerated pace of the technology innovations, which are making sensors smaller and easier to deploy, and making the compute power that’s used to capture, collate and share the data more powerful and economical, as well. People are excited about the combination of technological advancements and economic improvements in that process.

Then there’s the consumer effect, which is that we are all becoming much more data driven. If you think back on the lineage here, part of that lineage is the Big Data piece. All the buzz of Big Data is correlated with the cloud, because it’s my belief that we wouldn’t have talked about big data if we didn’t know there was something we could finally do with all the new data around us.

TOTH:  So you’re not blaming the cloud for there being so much data?

KAPLAN:  There’s always been too much data. That’s nothing new. But the cloud gave us the opportunity to do something that we’ve never done before, which was to capture and correlate it and share it and makes sense out of it.

In a similar way, we wouldn’t be talking about the Internet of Things if we didn’t have the connectivity. There’s no sense in connecting anything to anything unless you’re collecting data and you plan to do something with that data.

TOTH:  What are some ways that the data and the new connectivity are being used?

KAPLAN:  There are three primary stages to the use of data and connectivity.

One is to react more quickly if something goes wrong someplace. For instance, if the brakes fail on a truck, if you have a sensor in that vehicle, you can become aware of the brake failure more quickly, so you can fix it more quickly and get the truck rolling again more quickly—which saves money for that trucking company’s business.

The second idea is that if we know the brake has been used a certain number of months or miles, we can alert the owner of that truck that it’s time to get new brake pads, before the brakes fail. So there’s a proactive aspect to the IoT.

Now, the third piece is taking that data and possibly creating a whole new service around it. Let’s imagine that in our same truck brake scenario, someone is tracking the brake pads on a whole bunch of trucks and recognizes that one owner is more proactive about replacing the brake pads than another owner. That data could be resold to the insurance industry, which can use the data to make decisions about who they should be insuring and for how much.

TOTH:  Isn’t there something kind of unsettling about that concept?

KAPLAN:  Well, whether we like it or not, that kind of scenario is coming. Now, to put it in more positive terms, I have a friend whose family business has manufactured meters for many years, originally mechanical meters like the kinds used on fire extinguishers. The fire extinguisher meter tells if the unit is full or not.

My friend turned the mechanical meter into a digital meter, put sensors on all the fire extinguishers, and is now reselling that data to various insurance companies. The insurance companies like to know, for example, which hotel chain is doing a better job of keeping their fire extinguishers properly prepared. All of a sudden, this guy who took over an old-school family business has changed it from a product business to a service business and not into an information business.

TOTH:  I was going to ask you about some of the concerns people have about the IoT, but I think you’ve already started down that path!

KAPLAN:  The down side of all these new capabilities is the whole issue of privacy and security.

But there’s another concern that is even scarier: Your car is becoming much more software-centric, and we’re all going to have connected cars with a lot of software that basically manages every aspect of the car. The good news is that when it works, it’s going to be pretty cool. The bad news—well, think about if you get a software update on your smartphone or your laptop. How many times does the update screw something up? Can you imagine what can happen if you’re getting a software update to your car and it screws up?

TOTH:  OK, to end on a more upbeat note, how do you see your role in working with companies trying to navigate the new cloud and IoT worlds?

KAPLAN:  In the past I played the role of an industry analyst, but now I’m more of a trusted advisor. Companies come to me for a more grounded real-world understanding about this whole transformation process and what it means to them strategically. They have to rethink who they are, how they position themselves, and how they bring their solutions to market. I help them figure out the right tactics to achieve their business objectives.

I also host executive forums such as the Connected Cloud Summit, which takes place this year on September 18 in Boston. Echelon is speaking at this conference and will address the connection between what’s happening in the rapidly evolving IoT world and how a lot of it is being fueled by the tremendous growth of the cloud. I refer to this event as the Cloud Innovators Summit because it focuses on how the cloud has disrupted the way organizations are thinking about their businesses and exciting, new ideas for achieving their corporate objectives. We’re expecting it to be a lively and interesting event.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

Part 1 with Jeffrey Kaplan: Convergence of the Cloud and the Internet of Things

Jeffrey Kaplan, Managing Director, THINKstrategies

In part 1 of our discussion with Jeffrey Kaplan, Managing Director of the strategic consulting company THINKstrategies, we talk about the relationship between cloud computing and the Internet of Things (IoT). In part 2, we’ll cover some hot buttons and concerns regarding the IoT and the cloud. 

Wendy Toth:  What’s the relationship between cloud computing and the Internet of Things (IoT)?

Jeffrey Kaplan:  The reason I’m paying so much attention to the IoT is because of my longstanding focus on the cloud computing marketplace and the fact that the two of them have converged recently.

 

In fact, it’s my belief that we would not be talking as much about the IoT if it weren’t for the cloud, because it brings a number of enabling technologies to bear on the idea of the IoT. The cloud makes it possible for us to fulfill the promise of the IoT from a functional standpoint, but more importantly from an economic scalability point of view.

TOTH:  How does the cloud enable the IoT?

KAPLAN:  The cloud permits people to more easily connect to things, more easily capture information from those things, and then share that information. Because of that, it is perfectly suited to supporting the IoT idea.

While the idea of the IoT has been around for a while, it has been evolving in a kind of parallel path with the evolution of the cloud. It’s only been in the past couple of years that the two markets have begun to converge and become really intertwined with each other.

TOTH:  What do you mean about the economic aspects of the cloud/IoT relationship?

KAPLAN:  The IoT is about tying together or connecting remote objects and devices so we can monitor various services and products. There’s no better way of doing that, and doing it more economically, than using the cloud. The cloud’s infrastructure-as-a-service (IaaS) offerings have given us unprecedented compute power, but more importantly the opportunity to store data at scale in an economic fashion. Then the software-as-a-service (SaaS) layer and the platform-as-a-service (PaaS) layer give us the opportunity to analyze that data and share it in a more effective fashion, as well. It all serves the purposes of the IoT very, very well. 

TOTH:  Do you see comparisons with the IoT and anything we might have seen previously, in terms of how fast it’s moving or its promise?

KAPLAN:  One parallel is the transition from on-premise software to SaaS, another is from on-premise systems to IaaS. One is at the software application layer, the other is at the compute layer, and both have happened more rapidly than the industry analysts forecasted. That faster-than-expected rate of adoption is happening again with the IoT.

TOTH:  I’ve heard you admit there are areas where the cloud isn’t ideal. What are some of those areas, and how does this relate to the IoT?

KAPLAN: In certain geographic areas, cloud connectivity either isn’t available or it’s not up to par with local services. Even though I’m a guy who, as my wife says, looks at the world through ‘cloudy’ glasses, I’m also a realist, and I know that we are forever going to live in a hybrid world. 

That’s why it is a good thing we have the Echelons of the world to bridge that gap. As companies begin to adopt the new technologies and the new business models, they need to do it in such a way that it minimizes the risk of disrupting their current customers and capabilities. Echelon’s approach of providing a bridge from the old ways of connecting industrial devices to the new IP-enabled cloud way of connecting devices helps smooth that transition. 

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected]. 

The Promise of the Industrial Internet of Things

In part 2 of our talk with Bill Morelli, IHS Technology’s associate director of M2M and IoT, Bill discusses the trends from his 2014 report on the “Industrial Internet of Things - 2014” report and the promise of the Industrial IoT.

ECHELON: What is different about the 2014 report from your previous IoT paper?

BILL MORELLI: One big difference is that we have a lot more granularity. In the first report we had lighting as one massive category.  On this go-round, we moved residential lighting to the home automation category, and kept the lighting that was being used in commercial buildings in the building automation data.  So the lighting number in the current industrial Internet of Things report represents municipal lighting and industrial lighting only. The aggregated data for building automation includes building automation equipment, and building lighting, and commercial building metering.

ECHELON: How did that regrouping change the stats?

MORELLI: Moving residential lighting to our smart home report gave us more sanity around the industrial numbers. Because obviously, when you start counting light fixtures, the numbers can ramp up pretty quickly. 

ECHELON: Have your lighting forecasts changed then?

MORELLI:  Yes, when you back out the residential lighting and commercial building lighting, then lighting’s grown a little bit slower.  It’s about 10.2 percent -- so still significant over the five-year forecast period.  But a lot of the growth for lighting is in commercial building automation, and that’s what’s helping to push the (building automation) number up a little bit higher at 23 percent.

ECHELON: What role do big data and analytics play into the growth of the industrial IoT?

MORELLI:  The IoT provides a situation where you’re generating an awful lot of data.  And in the case of some industrial equipment – especially safety related equipment -- you need to be able to analyze that in real time.  And so that’s where cloud potentially comes into play.  You may not even need to store the data; it may just be a question of needing to have it available long enough to do the analytics to come to a determination, and then you’re bringing in a fresh data set.

ECHELON: So what’s the big ‘ah-ha’ from the report?

MORELLI:  In the stage we’re at now, a lot of it’s about having the connectivity, having the intelligence, figuring out how to collect the data and what sensors you might need.  We’re just starting to move to the point in which we’re figuring out how we do the complex analytics to drive the business decisions that we need. 

ECHELON:  And further down the road, what do you see?

MORELLI: In the longer-term vision -- your eight, ten-year long range vision—we’ll get to a point where, utilizing the cloud and utilizing some of the standards that are starting to emerge here, disparate systems will be able to start sharing information to create a greater benefit. 

ECHELON: Can you give us an example?

MORELLI: I like SmartCities as an example. Today in a city you may have a first-responder network, a traffic control system, and a transport and polling system. You may have individual vehicles able to tap into traffic apps to help map traffic.  But none of those systems are connected. In fact, they’re not integrated at all. 

In a true IoT SmartCities environment, you could have some level of information sharing, and some intelligence behind that. Then if there were an accident, you could respond in real time to move people away from the accident and route first responders there more quickly, and then transport victims to the nearest emergency facility in the quickest way possible. 

So we’re kind of moving toward that type of vision. We’re not quite there yet.  But to me, that’s the real, the promise of the industrial Internet of Things.

IIoT Talks is a conversation between industry luminaries and Echelon Corporation about the opportunities of the Industrial Internet of Things (IIoT) market. Echelon's Chief Marketing Officer, Wendy Toth, will share highlights of these conversations via the company blog. If you are interested in participating, please send an email to [email protected].