1
00:00:00,000 --> 00:00:06,000
Well, hello everybody. Here we are in the Austin Solution Experience Lab at IBM.

2
00:00:06,000 --> 00:00:09,000
And this is Michael Coté with RedMonk and we've got a guest with ourselves.

3
00:00:09,000 --> 00:00:10,000
Would you like to introduce yourself?

4
00:00:10,000 --> 00:00:18,000
Sure, I'd be happy to. My name is Jeff Smith and I'm the Vice President of the Communications Sector for the IBM software business.

5
00:00:18,000 --> 00:00:23,000
Another big part of IBM's business overall, besides being a technology supplier,

6
00:00:23,000 --> 00:00:33,000
is being a supplier of knowledge through our consulting practice to mostly very industry specific kind of problem sets.

7
00:00:33,000 --> 00:00:39,000
So as it turns out, we actually have quite a bit of domain expertise in the energy and utility space,

8
00:00:39,000 --> 00:00:47,000
which we are combining with our technology platforms and foundations to help customers deliver total solutions.

9
00:00:47,000 --> 00:00:51,000
I'm curious when it comes to energy, what exactly is the energy industry?

10
00:00:51,000 --> 00:01:03,000
Sure. Anything in the energy and utilities industry will start with an overall view or categorization of the problems that these energy and utilities companies are trying to solve.

11
00:01:03,000 --> 00:01:08,000
So they tend to break their business into three primary domains.

12
00:01:08,000 --> 00:01:14,000
The generation of the utility, or in the case of electricity, we tend to call it power generation.

13
00:01:14,000 --> 00:01:17,000
The transmission and distribution of the utility.

14
00:01:17,000 --> 00:01:24,000
This is where you get into the whole notion of an intelligent utility network, or in the case of electricity, a smart grid.

15
00:01:24,000 --> 00:01:35,000
And then the way that the utility deals with their customers and suppliers and the whole kind of customer iteration or customer operations part of their business.

16
00:01:35,000 --> 00:01:46,000
One of the fundamental starting points of a framework is to be able to go out into the world and talk to the customers and partners in the context of the problems that they're trying to solve.

17
00:01:46,000 --> 00:01:53,000
So our framework is built around those three fundamental solution areas for energy and utilities.

18
00:01:53,000 --> 00:02:00,000
You know, obviously IBM has a lot that you guys are doing in this area.

19
00:02:00,000 --> 00:02:01,000
Right.

20
00:02:01,000 --> 00:02:05,000
But I wonder, I mean, you have some new initiatives coming out, and I wonder how those connect and sort of ground all of this stuff.

21
00:02:05,000 --> 00:02:08,000
Like how the SAFE initiative, for example, fits into all of this.

22
00:02:08,000 --> 00:02:13,000
So if you look at what the fundamental problems are that SAFE addresses, we started getting into this earlier.

23
00:02:13,000 --> 00:02:21,000
But the areas of generation and distribution and, you know, the whole notion of interaction with your customers.

24
00:02:21,000 --> 00:02:21,000
Right.

25
00:02:21,000 --> 00:02:28,000
So let's talk about the middle section because it's really where, frankly, most of the early action is.

26
00:02:28,000 --> 00:02:31,000
That is the notion of what we call an intelligent utility network.

27
00:02:31,000 --> 00:02:40,000
We purposely generalize that term as opposed to saying smart grid because smart grid tends to refer to a power grid and it limits you into this world of electricity.

28
00:02:40,000 --> 00:02:41,000
Right, right.

29
00:02:41,000 --> 00:02:53,000
But the fact is that water as a utility is critical and will increasingly require intelligent distribution and management of the flow of water.

30
00:02:53,000 --> 00:02:58,000
And gas is certainly one that is already that way in addition to electricity.

31
00:02:58,000 --> 00:03:01,000
So electricity tends to be what you think of when you say grid.

32
00:03:01,000 --> 00:03:04,000
Let's start with the notion of an advanced meter.

33
00:03:04,000 --> 00:03:13,000
Just about everybody is starting their march down the smart grid with the notion of installing an advanced or an intelligent meter.

34
00:03:13,000 --> 00:03:23,000
And really what this is is a meter that can gather a lot of information about what's going on in the realm that it can see

35
00:03:23,000 --> 00:03:32,000
and communicate in a two-way fashion with, you know, not only the items in the realm that it can see that are consuming the power,

36
00:03:32,000 --> 00:03:41,000
but also the utility that's controlling the power in a way that either causes intelligent things to happen in the facility

37
00:03:41,000 --> 00:03:46,000
or that gathers a lot of information and brings it back to the central location and then they can do something smart with it.

38
00:03:46,000 --> 00:03:53,000
In the beginning, the whole notion of an intelligent meter was to, you know, allow you to turn service on and off without having to, you know,

39
00:03:53,000 --> 00:03:58,000
do a truck roll and send, you know, a guy out there or a person out there to turn it on.

40
00:03:58,000 --> 00:04:04,000
Or not have to send somebody out there to read it so you can tell how much power that the company was using.

41
00:04:04,000 --> 00:04:12,000
Increasingly, the intelligent meter will play a central role in the actual optimization of the entire flow.

42
00:04:12,000 --> 00:04:15,000
And so most people are starting with this notion of an intelligent meter.

43
00:04:15,000 --> 00:04:26,000
If you look at this section of our framework, we point out the technologies in the IBM product portfolio that would be involved in that example.

44
00:04:26,000 --> 00:04:27,000
We call it advanced metering.

45
00:04:27,000 --> 00:04:31,000
It's sort of a mapping of the technologies you have to these scenarios that you're talking with.

46
00:04:31,000 --> 00:04:32,000
That's exactly right.

47
00:04:32,000 --> 00:04:35,000
And actually doing, the software that actually does all of this.

48
00:04:35,000 --> 00:04:36,000
The software that does the work.

49
00:04:36,000 --> 00:04:49,000
And the good news for us is that, you know, we recognize that this is something that we need to do and want to do with other key partners that provide part of the capability for that entire story.

50
00:04:49,000 --> 00:05:09,000
And so SAFE as a framework is not only a collection of technologies that enable this, let's say, advanced metering management, but also that an ISV can interface with or leverage to help bring that total picture to the customer.

51
00:05:09,000 --> 00:05:29,000
While IBM is not in the meter business, we are for sure in the business of the software which would instrument the meter, like actually, you know, perhaps a piece of software that might sit inside a meter or in some kind of a collection point in a neighborhood where lots of meters are talking to it.

52
00:05:29,000 --> 00:05:30,000
Right.

53
00:05:30,000 --> 00:05:53,000
And do an intelligent job of correlating all the information that comes from that meter, categorizing it, sending it back to central facilities, housing it, storing it, and then allowing you to do, you know, trend analysis or predictive analysis on that, and then, you know, ultimately feeding the notion of using that information for optimization.

54
00:05:53,000 --> 00:06:00,000
It seems like there must be some sort of original content that gets mixed into that, that specializes it down to the industry.

55
00:06:00,000 --> 00:06:01,000
It's absolutely correct.

56
00:06:01,000 --> 00:06:05,000
And so the original content, we call it industry-specific assets.

57
00:06:05,000 --> 00:06:06,000
Right.

58
00:06:06,000 --> 00:06:11,000
But the industry-specific assets that come with it can come in a couple of different forms.

59
00:06:11,000 --> 00:06:28,000
In some cases, it's actually part of the product portfolio, but in an extension or some kind of a feature or a capability that you can buy along with the software that is specifically targeted at an ENU problem.

60
00:06:28,000 --> 00:06:51,000
Or in some cases, it's an asset which we offer along with the product that either the customer themselves or perhaps some kind of an integrator that they would hire, whether it's IBM or not, would use to actually, you know, methodologies, best practices, things that they would use to implement the solution, even though it's not part of the licensed product.

61
00:06:51,000 --> 00:07:11,000
One of the other things that we didn't talk about, that SAFE is built on the premise that the most effective way for us to implement these intelligent utility networks in the long term is built around a set of industry standards.

62
00:07:11,000 --> 00:07:20,000
Standards for how the pieces interact with each other, standards for how the data is constructed or brought back and analyzed, etc.

63
00:07:20,000 --> 00:07:25,000
And so the reality of the world today is that there are some of these standards that exist.

64
00:07:25,000 --> 00:07:27,000
A lot of them aren't really being leveraged.

65
00:07:27,000 --> 00:07:31,000
There's a lot of legacy equipment out there and interfaces out there.

66
00:07:31,000 --> 00:07:38,000
But we have a vision of a set of standards that we all agree need to be leveraged.

67
00:07:38,000 --> 00:07:45,000
So SAFE is built on the premise of being able to get the ultimate result through the use of these standards,

68
00:07:45,000 --> 00:07:52,000
but, you know, kind of meet the systems where they are today and start off with interfaces to whatever kind of elements exist.

69
00:07:52,000 --> 00:07:54,000
In general, what's the benefit of standards to anybody?

70
00:07:54,000 --> 00:08:07,000
I mean, standards enable maximum flexibility and interoperability, which ultimately the most benefits the customer who gets to, you know, buy, you know, pieces of things that fit together.

71
00:08:07,000 --> 00:08:14,000
Therefore, they can, you know, don't feel like they have to go get everything from one supplier and, you know, sort of locked into their specific portfolio.

72
00:08:14,000 --> 00:08:15,000
Right.

73
00:08:15,000 --> 00:08:25,000
So standards enable the maximum amount of interoperability and, therefore, flexibility of technical and vendor flexibility for the customers and the partners in the ecosystem.

74
00:08:25,000 --> 00:08:35,000
The world of the smart grid is going to be every bit as heterogeneous as, you know, a data center in the back office of a bank.

75
00:08:35,000 --> 00:08:37,000
I mean, it's just the reality of the way the world works.

76
00:08:37,000 --> 00:08:46,000
So standards are mandatory for that and standards give you the kind of flexibility and interoperability that is going to be required to make this work.

77
00:08:46,000 --> 00:08:48,000
I appreciate you spending all this time to talk with us.

78
00:08:48,000 --> 00:08:48,000
Okay.

79
00:08:48,000 --> 00:08:49,000
Thanks a lot.

80
00:08:49,000 --> 00:08:50,000
Thanks for having me.