Hitachi Vantara ups ante on industrial IoT

Established in September 2017, Hitachi Vantara brings together core capabilities from Hitachi Data Systems (HDS), Pentaho and Hitachi Insight Group into a single company to meet the growing demand for industrial internet of things (IoT) products and services.

The new company’s birth comes just after Hitachi Insight Group was formed in May 2016 to drive Hitachi’s growing IoT business, which raked in revenues of $5.4bn in 2015.

In an interview with Computer Weekly, Russell Skingsley, Hitachi Vantara’s Asia-Pacific (APAC) CTO, explains the thinking behind the formation of the new company, what it means for enterprises in the region and how its Lumada IoT platform stacks up against rival offerings.

There were already synergies between HDS, Pentaho as well as Hitachi Insight Group, which was formed not too long ago. What’s different this time round?

Skingsley: You’re right that there were synergies before, but what is not obvious is that the integration is much tighter and formalised now. For example, the Pentaho group was operating in silo, but now its management has been unified with the formation of Hitachi Vantara. Some of our business goals are more integrated than they were in the past. It also sends a better message to the market in name and organisation.

What does that mean for your customers in APAC, as well as internally from an organisational perspective? 

Skingsley: APAC is slightly ahead of the curve in integrating Pentaho and bringing Hitachi’s Insight Group and social innovation work into the mainstream sales force. For example, there were separate groups of Pentaho and HDS partners, but APAC was the first to bring them together under one unified partner programme.

Also, we had been very much product-focused, but now we are very much focused on business outcomes and solutions. Sometimes, customers may not even realise that the solutions we are putting forth include Pentaho. Similarly, Pentaho is integral to the analytics engine in our Lumada IoT platform. It is almost invisible to the customer.

What about the synergies with the larger Hitachi group in addressing the industrial IoT space? 

Skingsley: You’ve hit the nail on the head. You’ve probably heard our executives talk about bringing IT and OT (operational technology) together, and that’s the value Hitachi offers in a fairly busy market with mostly IT players such as Microsoft and Amazon. That has to be achieved if we are to bring anything new to the table. One of the most challenging parts of all of this is for Hitachi Vantara and Hitachi Corporation to get those synergies working more readily.

What is being done to bring OT and IT teams together, given that they have always operated in different domains? 

Skingsley: One of the practical things we are doing is to hire people with an OT background who are familiar with IT, whereas in the past we would mostly hire people who may have spent some time at Dell EMC or HPE. In fact, the most recent hire in my team was from GE Digital. To tap the OT expertise from the rest of Hitachi, we are putting in programmes to try to make sure we have access to all that capability. It’s fair to say that we still have work to do in that regard, but at least we know we’re getting more access to industrial experts.

As the CTO in this part of the world, what trends are you seeing in industrial IoT? Even though adoption is still nascent, do you think companies in developing APAC markets with fewer legacy systems might be able to leapfrog those in more advanced markets?

Skingsley: That’s a very good observation. We are actually seeing companies in emerging markets move straight to the newest systems and adopt the best practices. We are not seeing that same interest in developed economies. We also find that in APAC, there is a lot of manufacturing going on, especially in China, so we see a lot of interest in smart manufacturing.

What are your thoughts on the repercussions on cyber security as industrial control systems (ICS), which have traditionally operated in air-gapped environments, become more connected? Are ICS operators ready to deal with the security implications? 

Skingsley: I’m sure they are aware of the security implications, but whether they have the background or ability to understand them is probably a big question. Many industries have gone through that process, but I’m not sure whether those who deal with mission-critical infrastructure have that luxury. So when we built our IoT platform, we understood that security is paramount because our focus is on industrial IoT.

That said, do you think cyber threats against critical systems are overhyped and that the situation is as dystopian as security suppliers have made it out to be? 

Skingsley: IT security has always been about navigating the trade-off between convenience and absolute security. You can almost always guarantee security by not connecting to anything as long as you have physical security covered as well. But as soon as you connect to something else, you will open the door to some security risk. At some point, you will have to apply values to convenience and security, and decide whether the convenience outweighs the potential risks. Where it becomes dangerous is when stakeholders who advocate convenience have all the say and budget, while the security advocates are ignored or not given the money to do their job.

What kind of traction are you expecting for the Lumada platform in APAC? Are you gunning for specific use cases? 

Skingsley: Lumada is likely to get the most traction in smart manufacturing, healthcare, energy and high-speed trains – areas where Hitachi is already in play as an OT company. The longstanding experience that Hitachi brings in those areas is at least half the benefits equation. In smart manufacturing, for example, we have baked in concepts of what works in Hitachi’s factories. We also have reference cases because we have done it ourselves. So it’s not just about selling an IoT platform – it’s also selling something that we know works. Our IT competitors don’t have that experience to draw on.

From the IT side, we support cloud, on-premise and hybrid deployments. That may seem like a minor point, but it’s not. Some of our competitors who have done reasonably well have mandated that their platforms must be delivered through the cloud. That may make sense for consumer IoT, but in industrial IoT, network latency, security and data sovereignty are key issues. The inability to deploy those platforms on-premise is a showstopper for some customers.

Is that OT advantage enough to set Hitachi Vantara apart from competitors like SAP, which may not have deep OT expertise but has a large ecosystem of customers and partners with industry-specific knowhow that it can tap into?

Skingsley: We think there’s enough room for all of us, but we do think we have enough differentiation in the areas that we play in because we’re in the same OT business. It’s still very early days for IoT and, as time develops, there may be consolidation of platforms in the market and we’re a long way from that.

What about other IoT uses cases, such as environmental and building management? 

Skingsley: That is being handled by a separate social innovation group that deals with smart spaces and video analytics. There is an analytics engine in Lumada powered by Pentaho, which is also used by the social innovation group as their analytics engine. But they have built their engine separately without the need for other capabilities in Lumada. At some point, it will make sense for them to use Lumada as their IoT platform. They can also make use of connectors to take advantage of Lumada if they wish to.