Microsoft Joins Dell's New IoT Partner Effort

Microsoft is among 25 partners to join Dell's effort to create an Internet of Things (IoT) ecosystem, launched last week. Dell, which unveiled its first IoT gateway nearly a year ago, has lined up a variety of players ranging from key IT players such as SAP and Software AG, as well as those that provide industrial automation wares and services including INEX Advisors, Kepware, OSIsoft and PTC.

Dell's IoT push comes as a growing number of enterprise and consumer tech providers see a large opportunity to gather machine data from operational technology (OT) infrastructure including sensors and other machine components for the purpose of automation and data mining. Spending on commercial IoT technologies on infrastructure, software and services, but excluding devices, sensors and automation technology, is expected to be $247 billion, according to Technology Business Research. Growing at a 20.6% CAGR, the researcher is forecasting expenditures will mushroom to $629 billion on 2021.

Attention on IoT has built up in recent weeks as industrial manufacturers gather this week in Germany for Hannover Messe, where Microsoft's CEO gave the opening keynote yesterday. Nadella used the occasion to introduce a number of customers that are using Microsoft's Azure Machine Learning and IoT technologies to automate their manufacturing processes including Rolls Royce, Jabil and Liebherr Group. In the case of Liebherr, the company has linked up with Microsoft to automate their refrigerators and freezers using Windows 10 IoT (formerly Windows Embedded), Azure and Power BI to automate repair orders when a product isn't working properly.

"I would posit that what's new today is that the very thing that you produce, the very thing that you manufacture, for the first time, is connected with all of the web of activity around it," Nadella told the audience. "That is what's really different. These new digital feedback loops that I refer to as 'systems of intelligence' is the new inflection point that we collectively across the software industry or the digital industry and the manufacturing industry are, in fact, bringing forth."

Nadella added that the bridging of IT and operational technology (OT) will continue to enable a growing number of these "digital transformation" efforts. But as Dell and some of its partners noted at a media gathering earlier this month to discuss the computer giant's new initiative, bridging IT and OT is a complex endeavor.

For its part, the initiative Dell launched began several years ago as a business plan and the company has since defined IoT as a key area the company plans to embrace, said Jason Shepherd, director of strategy of partnerships and solutions. In addition to the 25-plus partners announced last week, Shepherd said Dell is gathering others, ranging from ISVs to system integration partners. Unlike other traditional IT areas, building IoT-enabled applications requires a multidisciplinary approach to bring together hardware that operates.

Dell's key entry came a year ago when it announced it had created a new division focused on offering IoT gateways, which are effectively small wall-mountable PCs with wireless receivers and loaded with an embedded operating system -- either Linux or Windows 10 IoT. The edge gateways typically receive signals from sensors or other fixed operational components. It then tags or processes that data so it may pass it along to some kind of database cluster or other processing engine where analytics are performed. Naturally, security and analytics are key components to the IT part of the industrial automation equation and Dell points to its own offerings and that of partners that can perform various forms of predictive analytics.

Dell, with Microsoft and Blue Pillar, are now offering solutions for utilities to help streamline the distribution of electrical power. A partner using the recently launched Dell Edge Gateway 5100 in a variety of scenarios including orchards, vineyards, greenhouses and logistical environments, often in environments subject to extreme temperatures, is INEX Advisors. Christopher Rezendes, INEX Advisors' president, said a good amount of these automation systems are evolving but Dell offers one of the more robust IoT edge gateways available.

"I think we got them early, so there is still a fair amount of feature sets that need to be stabilized or needs to be released, but we think with the approach they are taking, we're going to get a nice collection and selection of tools and utilities that will be pretty easily integratable in their stack," Rezendes said. "So it's not a finished platform so to speak, because not all the services and not all the features have been enabled in the services stack. But it performs brilliantly."

Most of the pilots he's involved in haven't used Microsoft's new Azure IoT offering yet, and Rezendes suspects cost is a factor. "I'm hearing they're very expensive," he said. Given Dell's close ties with Microsoft in other key areas, it makes sense for the two to tie up in advancing IoT, said Ezra Gottheil, principal analyst for IoT, devices and platforms at Technology Business Research.

"The Microsoft alliance is a good one for both Microsoft and Dell; Azure will be the platform of choice for many customers, especially for the 'start small' approach that Dell favors," Gottheil said. "This is not to imply that Azure won't scale up, but Azure is already present in a lot of environments as a result of Azure Active Directory, so some customers will not choose another cloud/IoT platform for small-scale IoT implementations."

Gottheil also noted Dell has a number of important key IoT components including its "well differentiated" software/services like Statistica and Boomi. "Their gateway is in essence a hardened PC, and will fit some solutions, but not all," Gottheil said. "Cisco's gateways are, naturally, more focused on connectivity and HPE's are server based. Many OT vendors also offer gateway solutions. Most of Dell's other IoT offerings are part of their conventional IT portfolio, as is also true of HPE, but Dell has a head start in working with its embedded and OEM partners to incorporate Dell solutions. On the other hand, companies like IBM and Cisco have a head start relative to Dell in bringing in new customers through an interest in IoT."

Posted by Jeffrey Schwartz on 04/25/2016 at 2:33 PM