Transcript.

Erik: Welcome back to the industrial IoT Spotlight. I'm joined today by Stan Schneider. Stan is CEO of RTI as well as vice chair of the board at the Industrial Internet Consortium. Today, we're discussing a couple topics with Stan. First, the ecosystem task group, which is a task group that Stan is running at the Industrial Internet consortium or the IIC, and the second is the connectivity framework. Stan, thanks so much for taking the time to speak with us today.

Stan: It's great to talk with you again. It’s always wonderful to be involved with IoTONE, I think you guys are one of the most clue-full analysts out there.

Erik: Stan, before we get into the IIC, just can you give us a quick background on RTI? Actually, the company has had a really interesting history. You have written a few waves of technology in the lifetime of the company. And how did you end up as the business you are today?

Stan: We started out as a spinoff of a lab at Stanford called The Aerospace Robotics Lab, is actually now called the Autonomous Systems Lab that really is focusing on autonomous, mostly flying things, but also space robots and stuff like that. And then, for a while we were trying to sell into robotics, back then there wasn't much robotics market.

The tools we had were very valuable and we became a tools company for a while. We sold that company in 2005. So here, we were sort of experts and autonomy. We didn't have our tools business anymore. We did have a pretty good bunch of people. And we looked around and decided that what do we want to do with the world? Well, there's a really interesting trend out there of device networking. At the time we call it the pervasive information infrastructure for devices now called the Internet of Things really and decided to go off and build an architecture and now call the framework for connecting the other basically, physics speed devices scale that would rival the internet. So it's been interesting timeframe.

It's really a way of putting together devices and intelligent modules and cloud components and all the things and the Internet of Things to build more autonomy and systems or in many more kinds of systems. We are definitely very active autonomous vehicles. We're also active in autonomous power systems and medical systems and different kinds of transportation systems like hyper loops, and even still some space stuff like launch control systems and spacecraft.

We live at the intersection of artificial intelligence and pervasive networking. We're not an AI company. We don't do backpropagation or deep learning, anything like that. But we do take intelligent modules. And we also run a networking company. We don't build networking hardware, really do when most people consider networking, connecting things together with wires and stuff. But we do allow you to take devices and connect them to intelligent modules and build smart stuff from them.

Erik: Stan, since the IIC was founded, I think that you guys have been one of the very early members, and always very active. And every meeting that I go to, you're there, couple of people from your team are there? Why are you investing so many resources from yourself and your team in the IIC? What's the value that you see out of going to being part of this community as opposed to just plugging away building technology and selling?

Stan: So we very much believe in the Internet of Things, especially we call the edge autonomy branch of the Internet of Things. I think that’s really is the future of technology. The thing that's holding it back right now, from our point of view, is pretty clear. It's just confusion. People don't understand what the different technologies do. They don’t understand what opportunities are for their businesses in this as market. They do see the disruption. There's a lot of fear out there. But there's not a lot of understanding how you can mitigate that fear and turn it into an opportunity for the future.

We're actually in 17 different consortia, IIC is just one of them. It’s certainly the biggest one that's horizontally focused. For us, we were already trying to build this device network. The IIC came along and really created a market. I give it full credit for creating Industrial Internet of Things market. The Stanford Business School definition of a market is a group of consumers with similar needs who communicate and can exchange.

Before the IIC, we have lots of independent projects that were not very well defined together in many different markets. And the IIC was the first place with the horizontal breadth and the technical depths that you could go in and actually talk about how a controller works for a CT scanner versus a vehicle versus a factory automation system versus a power system renewable plant. And that really caused the place where people could meet and discuss all these kinds of things together. It's an ecosystem first, and we got excited about this perfectly fits our vision, and we should go invest in this so we can help resolve that confusion and build the market, which is also sort of why I started the ecosystem test group.

Erik: Why don't we cover that one before we get into the framework? One of the things I really liked about you're working with the ecosystem task group is that you really make an effort to get the smaller companies involved. Naturally, a lot of people probably think that the internet market is naturally going to be dominated by some of the very large technology companies because they have this legacy infrastructure in place, they have the R&D to really go deep and technology stacks that allow them to already connect systems, whereas smaller players have to figure out where does my technology plug into a quite complicated system? Give us a little bit of background, what how did this get kicked off, the ecosystem task group?

Stan: So, first of all, there's lots of different kinds of companies, organizations in the IIC. There's big companies. There’s small companies. There's [inaudible 20:26] universities. There's governments. There's nonprofits, all sorts of things. It's a real mix of organizations. Most of the organizations joining the IIC really have a pretty long term viewpoint. They're trying to create standards and technologies that they can build multibillion dollar businesses down the line, where down the line there’s 5, even 10 years out. Small companies obviously can't work on that kind of timescale.

I still am a steering committee representative for small companies. I was trying to find a way for small companies to leverage the IIC into a couple of different directions as partnerships and awareness. And IIC is really a very rich ecosystem. [inaudible 21:22] built lots of great partnerships there and we thought maybe we could find a way to make that a little more available to companies that didn't invest quite so much as we did. And so that was really the genesis of it is create an organization whose main purpose is to allow the members to monetize their investment in a couple of years, rather than five or six or more years

If you look at the IIC and what it really does, it's doing three things. First of all, it's an ecosystem where organizations can cooperate and build competitive positions and build partnerships and go to market plans with other companies. The market is too big for anybody taking out a loan. So that's the first thing. The second thing is actually putting together guidance. But how should you actually build your systems? Well, the technical experts, and the last thing is doing its testbeds actually prove that the guidance and ecosystem work.

So the ecosystem task group really does two things. The first is really just a match service. We hold a session called IIC connect the face-to-face meetings where you can sign up for slots to talk to other companies. It's a great place to spend 20 minutes really digging into what somebody else does. So if you're a small company, you can try and find partners or uses of your technology. And if you're a large company, you can get to know better what's going on in testbeds, or what technology trends are. So that's one service.

The other thing we're doing which is not released yet, which will be soon because I think it's going to end up being called the IIC ecosystem directory, which is a browsable index of the IIC. If you have Google, you can search for all sorts of things, the Internet of Things, but you have to know what to search for. And it's very difficult to know what to search for. Because just the connectivity world where I play, there's so many conflicting terms that you never really figure out what a connectivity framework is, or what's different standards really do and all that kind of thing.

So we're putting together a directory of the companies, in the IIC, it's sort of a microcosm of the entire market, because the IIC is quite a broad ecosystem. And with that, when that goes live, people coming in to the website should be able to figure out much quicker how the market is structured and what different types of technology is, different types of connectivity. Security, there’s 400 and some odd IoT platforms out there. They all do very different things, what categories are there and what kind of development resources are, what kind of services are, what kind of hardware there is, all those kinds of things you can figure that out from our ecosystem directory when that goes live. So that's the second thing we're doing.

Erik: But there was a white paper For a report out recently called Pilot Purgatory around the IoT space and a lot of projects that were getting done as pilot projects relatively small scale, and then were, for various reasons, not ramping up. And I think some of the reasons are directly related to connectivity and the challenges that companies have and figuring out how to scale connectivity. But where are you seeing that today?

I mean, obviously, RTI is doing well. You're growing the business. Other companies also are growing their businesses. But where do you see this market today in terms of maturity moving out of the earlier stage, exploratory projects, pilot projects, or small scale local projects towards really mass adoption of systems that are radically changing the businesses that are investing in them?

Stan: So I think to really understand that, I'd like to back up for just a second and talk about what is the Industrial Internet of Things anyway. But there's three big categories of things out there and this isn't from the IIC, this is more from my own observations. But the first category of things that RTI close calls are device monitoring. And the entire consumer Internet of Things fits in device monitoring.

We have a single device, it talks to a single cloud service or IoT platform. It really doesn't talk to any other devices very much and doesn't talk except through that platform for much and other things. This includes Fitbits, and thermostats and intelligent doorbell ringers, and all those kinds of things, they all talk to one platform. In the industrial world, it has use cases like predictive maintenance and optimization of parts and things like that. But it's really, from a connectivity point of view, fairly simple, and actually, from a successful deployment point of view, mostly more simple.

The next one is we call analytic optimization, you take a plant, you put thousands of sensors on, you collect all that data, and get it up to the cloud, and then analyze it to optimize it so you can make the plant run better. It's quite a different use case. There's a lot of different things for that, a whole another bunch of IoT platforms that do that kind of thing.

And then the last thing, what we work on mostly is we call Edge Autonomy, where the real action isn't between devices in the cloud at all, it's between devices in the edge and the cloud may well be part of that. But you're really building something that's smarter and more active out in the field. This thing about Pilot Purgatory, there's Pilot Purgatory in every industry, if you follow the Gartner Hype Cycle, everybody thinks the next technology is going to solve everything instantaneously. And then, when you find out that that doesn't quite work, you fall into what they call the trough of disillusionment.

I definitely think there's some of that going on especially in the consumer IOT space. People see that as negative. I see that as an absolutely necessary step to the next phase of the market and an excellent thing because it will ones that aren't in purgatory are doing quite well and building entirely new directions.

About RTI, we have quite a bit of traction mostly in things that have some very compelling reason to get better that often has nothing to do with the Internet of Things. So example, that's economists cars, but also renewable generation, renewable integration into the grid, which is very compelling but it doesn't work well today because it's not smart enough solving some of the problems with hospital within intelligent connected medical devices.

And these are actually going after real problems, not just optimizing something to make it a little bit better. A lot of the pilot purgatory is it's expensive to build these new systems. And if you're just trying to optimize or do something that's a little bit better than the old way, you have to get the cost down pretty low and technology to be pretty reliable and easy to do before you realize that benefit.

In the areas where you're really creating something new rather than optimizing something old, I think certainly, many pilot autonomous vehicles, for instance, they’re not going to make it. But that is such a change in the way the world works. It's quite compelling to get through the pilots to the next stage of development.

Erik: In this market, maybe we turn out to the connectivity framework. I think connectivity is one of the areas that needs to be refined, in order to make some of these more mass market adoptions feasible. So a lot of solutions that look good on paper and maybe in the marketing materials, when they're actually deployed, don't meet expectations because of the challenges and actually moving data between the edge and the systems on the very diverse set of legacy environments that are out in the world. And so, finding a way to standardize this so that we can actually move information around cost effectively and reliability is very, very high priority.

Maybe before we get into any detail, just high level background into the connectivity framework, what was the impetus behind putting together minds and developing this?

Stan: So our first goal was really just analyze all the standards out there and understand how they were, the same indifferent. And I actually wrote a paper that said we're going to plot the requirements against what the standards can do. We even had 10 different dimensions of requirements. And then when you've done with that, you should be able to understand which standards could solve your problem, then you pick a standard based on other factors. And at least you've narrowed it down.

And then we spent three years and got everybody together to really analyze this and everybody means many different companies, performance of the various different standards. We did a lot of deep analysis. I found the shocking conclusion that people are still coming to grips with out, that the space is unbelievably immense and the use cases are very, very big, and all these standards that you've heard the alphabet soup of standards, they're so different, there's almost no overlap.

Before this, there's still a lot of debates online about all different the standards better than that standard. I've come to a pretty strong conclusion that they don't overlap at all. And if you're in business and trying to build something, you really should spend a lot more time understanding the standards before you try to choose one. Because if you just choose something that you're familiar with, you're probably going to go the wrong direction. You really need to understand what they do differently.

And the differences are so big that I can ask you just a few questions for any application and figure out which standards is used in almost no time. And we actually have papers on that. We're actually building an online tool to help you just select which one there is. So, it's really a pretty surprising outcome. But I think it's quite true that just a few questions, even just your vocabulary, do you know what a work cell is? If you know what a work cell is, you probably should be looking at OPC UA. Do you have more than 10 software engineers? If you have that, pretty good chance you should looking at DDS.

It's really that simple. They’re so far art that it's pretty easy to do a pretty good job selecting the one that's going to fit your application the best. And I think it's backed up by a lot of really good technology and science and studying. So that's the fundamental thing.

The other thing, because they are so far apart, the eventual real Industrial Internet of Things needs to be able to integrate multiple standards, so we put together an architecture for doing that in a sensible way. It's now called the Core Connectivity Architecture.

Erik: So I guess the first challenge would be understanding the correct standard for your application. But I think often the challenge that a good amount of research is not necessarily going to solve today is how to deploy a solution across an environment that uses many different standards. And even if you're just looking at the factory floor, I mean, it's incredible that some of the questions are, well, we have some sensors, you're telling me you have an IoT platform, can you get the data from our sensors to your platform? I mean, that's a very fundamental action. But in many cases, that seems to be the bottleneck to actually deploy in relatively straightforward solution. How are you addressing this?

I think this is incredibly important. But it's not easy, because there's technical challenges. But there's also a lot of businesses that have done very well by owning particular verticals and controlling which technologies are able to access into those environments by controlling the standards. So there's also some business aspects that are challenging or there's some strategic aspects with some of the legacy companies. How do you address that component through this framework?

Stan: So as you RTI there or IIC?

Erik: Let's take it from the IIC perspective.

Stan: From the IIC perspective, we're trying to provide a vocabulary and clarity. I believe the number one thing holding back the Industrial Internet of Things is confused. We're just trying to provide enough clarity that you can navigate all the crazy claims out there. So there's at least four standards that claim there, publish, subscribe real time Internet of Things protocols. And it’s true for all of them but they're vastly different because they publish and subscribe to completely different things. They define real time as differently as sub millisecond to today. They define things completely differently. Some of them define the thing as a thermostat. And others define the thing as the entire western grid and it’s just completely different definitions. All those overloaded terms becomes impossible to navigate.

So, the first thing the IIC really did is put together, okay, here's a way to analyze different connectivity technologies, and the least understanding what they can do that’s different from the others. And RTI was very active in that because it's very much in our interest not to go and try and sell our product in the applications where it doesn't really make sense. You actually look at the internet, the internet changed everything. The internet changed banking, it changed media, it changed travel agencies, it changed retail. It's in the process of changing taxis. And you run out of things pretty quickly, created some new stuff like search and social media, but that's about it.

You walk into a hospital or factory or a power plant or you look at the transportation system today as it was in the 90s before there was an Internet, and they all fundamentally still work the same way. And the internet of things is really capable of changing all of those quite fundamentally. And that opportunity it's just amazing how much that's going to change, how many different industries the IIC is vertical taxonomy of things we expect to be impacted by the end of the things fills an entire page, entire screen with about 6.5. It's really a huge impact on the entire world.

So from the IIC’s point of view, we're trying to help all those industries map their application, especially as the applications are not necessarily tied to an industry to the technologies that can make it work and then someday making those technologies work together. I don't think we're quite to where there's all that much use case. For the someday, that's the next phase of the market and which is further out than just getting people online and getting all these devices connected and getting the big value out of that.

Erik: From RTI’s perspective, is the primary value of this then having a clearer understanding of where DDS or where your solutions would fit in to the greater ecosystem, and then being able to communicate that out or hopefully having even potential customers or partners already have an understanding of that because they've maybe read the framework or some of the information has seeped into the general awareness, is that's the value right now?

Stan: It's already helped RTI a lot. I can ask you five questions, you don't have to know what I do and I don't have to know what you do and I can tell you if you're buy my product with 100% probability. I think that the space is so large, that most companies should be able to focus down to that level of detail if they really want to dominate something or grow more aggressively.

And my questions are things like what happens to your system if it stops running for a short time, a minute or two or even a few seconds too fast you can't reboot servers? If you answer that, that's a big problem. It's not just going to shut down my line for a couple hours, but it's going to take down the western grid or crash a car or crash an airplane or something like that, check that box. The second question, you said the word ‘millisecond’ in the last two weeks, you don’t need to know what I know to answer that question.

Third question, you have more than 10 software engineers. Fourth question, are you sending data to more than one place? Because the first two major categories of Internet of things I talked about are all just talking to the cloud. Our DDS, standard were based on, it does talk to the cloud, but mostly it’s between devices, sending data, lots of places.

And the last question, really building some our software architecture for the long term future, it's going to last three or five years, are you willing to build a new architecture? If you have the answer the first question, yes, the last question yes, and any three in the middle, you're going to end up buying our software.

With the IIC lab, I have similar five questions for all the other standards, and I think they're pretty diagnostic. You can go through and ask these questions. And I actually have a paper in IIC Journal of Innovation, what the questions are, and you can probably figure out which of the standards you should use. We're trying to turn that into an online tool, help people figure it out. So, having the confusion out of the industry really helps companies find a clear niche where they can really grow and excel. And that's really what we're trying to accomplish with that.

Erik: That would be an excellent online tool, because I think asking somebody to read through a white paper, that's a bit of a heavy ask. But if somebody can basically go on a website and say, I'm building the solution, answer 10 questions, and then here's the one or two things that you might want to look into…

Stan: Here’s what you should go look at. And most of the questions are pretty simple. Do you know what ICT stands for? And is describe what you do. I'll ask you that. Do you probably do, you're an analyst?

Erik: Stan, in the overview of the IICF here, it mentions gateways, do you believe that gateways are going to be at least in the near term just the default solution for when you're working in environment with multiple standards, and you just push everything through a gateway standardized and then get it up to the cloud or an external system? Is that what we should expect for the vast majority of solutions in the coming years?

Stan: So actually, we define two different kinds of gateways. So, all gateways aren’t the same. We believe we do need standard gateways. So gateways that are actually controlled by a clearly written standard that translates between data models and data systems on either side of the gateway in some known way, that allows you to build an interoperable internet. And then you also need a gateway that's between the core standards. And to get out of the internet, now you need another gateway that just connects whatever your standard is into one of the core standards and now you should be able to build an entire architecture without having to have incredibly powerful gateways that can handle many, many different kinds of standards.

And the squared problem is huge. You've tried to make gateways between all the standards, you get out of control very quickly. There's just too many of them. I do believe that there will be some effort. Today, there's only a few real compelling reasons for gateways translate between stead. But in the future, I think there will be more and more especially for these core standards that are allowing you to connect together different compelling subsystems in the larger network. There's always going to be some use for taking unusual standards and connect me or unusual protocols and nothing to do with a standard and connecting them into the rest of the system or connecting legacy things like field buses and wireless protocols where you don't really have a lot of data modeling capabilities like Bluetooth or LoRa or something into the system.

Erik: And for this class of gateways that are really for helping to mediate between different standards, do you think we're aligning as an industry on what language those gateways need to be able to speak? Do you think that we are moving towards a solution where you can go and reasonably expect that there's going to be a gateway on the market that will allow you to communicate? Or are we going to just have eight of these and there's going to be then another device that's going to have to mediate between these different gateways because we're just kind of adding another level of competing technologies? How do you see that playing up?

Stan: So I think the market is not one thing, it's huge. I definitely think there are parts of that huge market that absolutely are headed towards pretty clear adoption of standards. Autonomous vehicles, for instance, for higher levels of autonomy, that's sort of where DDS is doing very well. The Autostar standard just adopted DSS connectivity technology inside auto, Sire without us as the standard for vehicle. So, [inaudible 47:53] Ross framework, which is a researchy kind of framework for autonomy, it's doing well there. And I expect that to become fairly well established quickly.

There's other markets that are much less established. In the connectivity world, the easier your challenge is, the more options you have or the more specific your challenge is to a single layer. So there's lots of different options, for instance, for wireless connectivity. And they are definitely difference. But it's still pretty confusing which one you should use. And we haven't really analyzed that. There's actually a new group at the IIC now analyzing that the connectivity framework we're talking about really is just layer four up. And the reason we chose that first, if that's really the most important for building a large industrial Internet, but the other parts certainly also needs work. And it's farther out before I think there's really going to be consolidation of standards.

Erik: This new work, when do you expect that to see the light of day?

Stan: Not that tied up in it, but it's really just getting going. I expect at least a couple of years, a year. And it takes a lot of work to do a good job of analyzing all the standards and coming out with useful stuff. Also, there's a lot of people working on it, so it might be quicker than that. It took us almost three years to do the connectivity framework. It's a lot of work to really understand all these technologies at that level. So it'll take some time there. But in the meantime, of course, the market is helping by choosing some winners and losers out there. But I think the Internet of Things market in general is so large, I think there's a niche for almost all the technologies out there. Just the hard part for consumers is figuring out which one they should use because I think a lot of them are not going anywhere soon, though, they'll be around for a very long time.

Erik: And also, I think the hard part for a lot of the younger technology companies that I talked to is also figuring out which market they should serve. I think a lot of people are still feel like they have a horizontal technology and it's a bit difficult to identify which market do I really compete well in as opposed to having a hypothetical solution for?

Stan: But most technology companies, I would actually recommend, it's very nice and compelling and attractive to focus on a single vertical. The actual use cases out there are not typically in vertical. There's mammals that can fly like baths. There's mammals on the land like you and I. And there's mammals underwater like whales, that architecture has worked well in many different environments. You got to decide if you want to compete in all the environments. But you certainly couldn't compete in the environments if you do a good job of understanding where you have real advantages, where does warm bloodedness and intelligence play well in the animal kingdom. You aren't going to be able to go and compete in space with octopuses, maybe. But you can definitely find the place where you can compete in all those niches.

And we RTI has made the clear decision, we're going to stick with our five questions or we're going to go after a use case that isn't necessarily tied to every market. But in the markets where it is we're going to compete there. So for instance, we have so far almost no use cases in manufacturing. But we agree use cases and transportation and medical and power systems and air traffic control in underwater systems, and all sorts of stuff, defense Systems. We don't really have other connectivity solutions that have anything close to the capabilities we have for large software design.

Erik: Actually, at IoTONE, we've just restructured our online database away. Before we were really relying on industries and functional areas, so manufacturing, R&D, and so forth, and now we're really focusing on using use cases to define what a solution does. And that seems to actually work a lot better, I think you're right.

Stan: It’s a much better way to understand the industry by its technical challenges and by its traditional vertical. Very hard for people to accept that, because they're very used to going to shows that are around medical or transportation when they really should be going to shows that are around highly reliable distributed system.

Erik: I probably learn a lot by talking to some other companies that are either maybe a little bit ahead of them from a different industry, right?

Stan: The Internet of Things really comes down, what it is really all about is suddenly technologies for many different industries are impacting other industries. And all of the confusion is because of that. It really is you see technologies coming from different places where they built a niche. And suddenly, they're applicable to many other places because the computing power and the connectivity is suddenly there that wasn't there before. And it takes people that have been working for 40 years in the power industry in a long time to come to grips with the fact that the new technology that's really disrupting their industry came from defense or came from automotive or something like that. That's the story out there that's causing all the disruption, that and the fact that software is heating the world.

Erik: We have a growing number of companies that are approaching me and saying I want to see what's happening in a sector that is completely out of my primary scope, I want to see what's happening in consumer retail in ecommerce and so far, things that just have no direct relevance to their industry, but are maybe a couple of years ahead of them in terms of adopting particular technologies. Especially in the consumer space, things move quickly because they can to an extent, and they can be an interesting source of information for an industrial company.

Stan: One of my favorite examples is there's a different consortia was actually formed by Exxon Mobil, big oil and gas company hired Lockheed, a defense company, to build an architecture for refineries based on a standard called Face for Avionics. And that is just sort of throwing that industry into some serious potential disruption. And a lot of people are trying to defend the old ways. And I think defending the old ways is a pretty dangerous thing to try and do without really understanding new ways. The first reaction is we already have this all figured out, we did it 20 years ago or 40 years ago even. But the better reaction is, well, how can I leverage these new technologies that are coming from other industries into my industry?

Erik: So Stan, I think that's probably a good place to call it. I know you're a busy guy, you've got things to do. How can companies, people get in touch with you, whether it's companies or people that are interested in RTI or in the IIC, what's the best way to reach out?

Stan: I'm easy to find, email standardrti.com. I usually get everything reasonably quickly. LinkedIn is great. Stan Schneider, it's not hard to find me on LinkedIn. Twitter, I'm RTIStan, if you want to tweet at me, I'll see that. I'm sort of all over the IIC, come into the IIC meeting, that will be a great way to find me. If you're involved in the IIC, definitely sign up for IIC Connecting request a meeting with me, I'll be very happy to meet with you and help you, give you a guide to the industry there.

Erik: So if you happen to be in Finland or near Finland, the next IIC meeting will be May 25th. And then the Q3 will be in Chicago, the week of September 12-15th, that is. And then the Q4 will be in China on November 16th. And non-IIC members are welcome to stop by and meet the community. So please do make an effort. Stan, thanks so much for taking the time.

Stan: Yeah, thank you very much. Great talking to you.