remote monitoring: an industry perspective techventures / professor mohan sawhney march 7, 2006...

REMOTE MONITORING:AN INDUSTRY PERSPECTIVE

TechVentures / Professor Mohan SawhneyMarch 7, 2006

Prepared by Michael Dickman, William Nicolau, and Alfonso Yanez

Remote Monitoring: An Industry Perspective by Dickman, Nicolau, and Yanez, 2006.

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EXECUTIVE SUMMARY

• Remote monitoring (RM) a diverse sector that requires multiple competencies and applies across industries

– Industry-specific definitions but several characteristics in common– RM been around in some form for a long time, but RM now enabling both new uses for existing

technologies and entirely new types of applications

• Research shows RM applications best classified by interactivity and mission criticality– How active or passive is the technology?– How critical is this use to the organization? Catastrophe-prevention or nice-to-have?

• Complexity of RM value chain indicates players likely to specialize in one to two segments

• Have analyzed five industry verticals, highlighting importance of customizing technology, deployment, and sales efforts to industry needs

– Government & homeland security, retail & consumer goods, transportation & logistics, oil & gas, and health care & medical devices

• Many exciting opportunities exist in RM for both entrepreneurs and existing companies with relevant technologies and/or capabilities

– Winners will provide software driven applications with real-time, interactive remote control capability that offers almost unlimited, fast, wireless information gathering/reporting, easy-to-use for relevant field personnel


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AGENDA

Introduction and framework

• Definition, brief history, and what is new

• Overview of remote monitoring landscape and value chain

Industry vertical deep-dives

• Government & homeland security

• Retail & consumer goods

• Transportation & logistics

• Oil & gas

• Health care & medical devices

Takeaways and opportunities


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WHAT IS REMOTE MONITORING?

• Definition is different by industries:

•Computing: A network management protocol that allows network information to be gathered at a single computer

•Transportation (Brazil): Service that enables companies increase the security of their fleet

•Health Care: technology that enables doctors to remotely check their patients’ health status

The ability of an entity, such as a human being, hardware or software, to communicate with other entities that are distantly

located from one another, in order to passively receive information about its behavior and/or influence such behavior

The ability of an entity, such as a human being, hardware or software, to communicate with other entities that are distantly

located from one another, in order to passively receive information about its behavior and/or influence such behavior


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INFRASTRUCTURE PERSPECTIVE

Communication Infrastructure

(coaxial wire, wireless, RF, bluetooth, etc)

Receiver

Transmitter

Display/processor


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WHAT IS NEW HERE?

Defining features

Typical applications

Example: Surveillance

•Manual

•Slow

•Single piece of information (on/off)

•Manual response

Smoke signals

Battlefield flag signals

•Analog and wired

•Fast

•Limited information flow (e.g. product ID)

•Manual response

CCTV

Battlefield radio

GPS locators

RFID in supply chain

•Digital and wireless

•Real-time

•Explosion of sensor-based information

•Automated response (from BPO to battlefield)

“Remote sentries”

Full battlefield mgmt

Remote fleet control

Cargo container sensors

“Smart dust”

Yesterday Today Tomorrow


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Active

Passive

Low High

Interactivity

Mission criticality

RESEARCH SHOWS RM APPLICATIONS BEST CLASSIFIED BY INTERACTIVITY AND MISSION CRITICALITY

However, Few Non-Military Technologies Commercialized for Active, Critical Uses

Battlefield vehicle location/status

Traffic monitoring / traffic signals

Flow monitoring / gate control (fluids)

Satellite reconnaissanceFleet en-route

location

UAV border patrol

UAV attack missions

Tank level monitoring

Macro-geological remote sensing

Oil & gas pipeline integrity

Installation surveillanceConfiguration and

maintenance fleet tracking

Retail inventory tracking

Automated digital control (e.g. HVAC)

Vital signs monitoring

Intra-body device monitor & control

Patient compliance

Oil & gas

Transportation & Logistics

Retail & Consumer Goods

Health care & medical devices

Government & Homeland Security

Industry Verticals

Cargo portals


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Capture Transmission Receipt ProcessingMonitoring/

action

Technologies

Requirement for success

Example players

•Cameras•Motion capture devices•Smart sensors•RFID TAGs•Robots

•ADT•Dust networks•Philips semiconductors•Robodynamics

Remote data step in value chain:

•Coaxial Wire•DSL•Optic fiber•Satellite•WI-FI•GPRS

•Reader systems•Antennas

•Servers•PCs•Database•Storage

•Display technologies•Algorithms

•Mobile and fixed telecom companies•Infra-structure companies

•Intermec•Symbol•Zebra

•Sun, HP•HP,Dell•Oracle, Microsoft, Sybase•EMC2, CA

•Medtronic•IBM•Dust networks

•Miniaturization•Low power consumption•Use standard protocols

•Reliability•Compatible speed•Low infra-structure cost

•Spectrum•Seamless mobility•Reliability

•Speed•Reliability•Scalability

•Translation of signals to readable front-end applications

Interactivity / remote control

COMPLEXITY OF VALUE CHAIN INDICATES PLAYERSLIKELY TO SPECIALIZE IN ONE TO TWO SEGMENTS


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AGENDA








• Oil & gas




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GOVERNMENT AND HOMELAND SECURITY

Interactivity and mission criticality

Value chain opportunities

• Government’s role as direct purchaser of almost all applications explains three themes

– Stringent security controls drive RM as an enabler for new interactions with existing technologies

– Integration with legacy systems and non-technology processes critical (e.g. surveillance with sentry)

– Special class of applications for battlefield use

• Technologies often not the differentiator, with a few exceptions

– RFID, Wireless Internet ubiquitous across industries– Exceptions in military applications (e.g. military

vehicle GPS locators with inertial stabilization)

• Current players a mix of large and small– Large players usually long-time government

contractors adding RM (e.g. UNITE alliance)– Small players carefully customize for government

needs (e.g. Crossbow, Intuicom, and others)

• Data capture and monitoring/action most important areas for development

– Winning combination will be new types of sensors on front-end with information-efficient interface on back-end, all utilizing existing secure infrastructure

RM industry overview

Active

Passive

Low High

Interactivity

Mission criticality

CaptureTransm-

issionReceipt

Process -ing

Monitor/ action

Opportunity area

Not a pain point

Already mature

Vehicle GPS

Satellite RM / redirection

UAV

Remote sensing

Integrated CCTV


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RETAIL AND CONSUMER GOODS



Situation• High volume, low prices strategy have generate a great

focus on optimizing the supply chain

Uses• Tracking inventory• Process Automation – e.g. SAP’s Electronic Proof of

Delivery (E-POD), invoice reconciliation• heating, ventilation and air conditioning (HVAC), lighting,

refrigeration, electrical systems

Who is leading the use?• Major retailers driving change (e.g. Wal-Mart)

– Forcing upstream supply chain to adopt RM

Technologies:• RFID• Automated digital control

Opportunity• Maturity• Pain point – Cost on the capture side (cost of

transponders is still high to massify)• Specific applications of automated digital control, but they

are not mission critical


Active

Passive

Low High

Interactivity

Mission criticality

CaptureTransm-

issionReceipt

Process -ing

Monitor/ action

Opportunity area

Not a pain point

Already mature

Retail inventory tracking

Automated digital control

(e.g. HVAC)


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TRANSPORTATION AND LOGISTICS



Situation• RM linked to core business of transportation companies• Increasing service levels drive tracking and visibility

Uses - Fleet• Fleet en-route location• Configuration and maintenance fleet trackingUses – Infrastructure• Asset monitoring – bridges, roads, subways

Who is leading the use?• Major carriers – UPS, Fedex, etc• Government (Department of transportation)

Technologies:• RFID• Sensors, RF, and specific optical communication devices• Software capable to distinguish “abnormal” variations of

temperature, pressure, seismic movements, etc

Opportunity• Monitor/action - specific applications for fraud prevention

through remote fleet management (cutting engine remotely)

• Transmission - New communications tech (e.g WIFI) will generate large infrastructure upgrade


Active

Passive

Low High

Interactivity

Mission criticality

CaptureTransm-

issionReceipt

Process -ing

Monitor/ action

Opportunity area

Not a pain point

Already mature

Fleet en-route location

Configuration and maintenance fleet

tracking

Asset monitoring


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OIL & GAS



Situation• Maximize asset utilization - Throughput and increase

uptime• Environmental compliance

Uses - Upstream• Reservoir management – control gas lift and reduce

maintenance

Who is leading the use?• Major oil companies due to Environmental compliance

Technologies:• Specific sensors to control leak detection, temperature and

other conditions• Software capable to distinguish “abnormal” variations of

temperature, pressure, etc

Opportunity• Monitor/action – RM testing may be used for

environmental test compliance• Transmission – Off-shore drills (e.g VSAT)


Active

Passive

Low High

Interactivity

Mission criticality

CaptureTransm-

issionReceipt

Process -ing

Monitor/ action

Opportunity area

Not a pain point

Already mature

Flow monitoring / gate control (fluids)

Tank level monitoring

Oil & gas pipeline integrity


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HEALTH CARE AND MEDICAL DEVICES



• Two important drivers: health management costs and technological development

–Prevention is cheaper–Development in Microelectronics and

Communication

• The industry is moving towards the idea of the “Body Area Network”.

–Intra-body devices such as pacemakers–On-body devices to control vital signs–Off-body devices for patient compliance

• Users will be the patients and health care management companies (insurance, clinics, hospitals, etc)

• Big players are not only the traditional medical devices companies (Medtronic and J&J), but also the IT ones (IBM, SIEMENS)


Active

Passive

Low High

Interactivity

Mission criticality

CaptureTransm-

issionReceipt

Process -ing

Monitor/ action

Opportunity area

Not a pain point

Already mature

Intrabody devices

Vital signs monit-oring

Patient compliance


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AGENDA








• Oil & gas




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KEY TAKEAWAYS

• Customization key– Don’t see a single large player across industries

• Mix of new apps and new categories

• Monitoring will become control, the next wave is real-time automation, centrally controlled

– Software needed to turn data into information as centralization explodes complexity

• RM dramatically expands opportunity for BPO services


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Maturity today Drivers of adoption Hurdles to overcome

• How many players are there today?

– Big or small? Deep pockets?

• Is the end-use a mature market?

– E.g. better pipeline management vs. “smart dust” deployment

• How much technology risk?– Repurposing existing

technologies or something new?

• Who is ultimate customer? Who is willing to pay?

– If RM provider is far upstream, who creates primary demand?

• How badly do target customers need this product?

– Pricing must reflect cost of BAT

• Does RM accelerate/support existing business plans?

– E.g. supply chain focus

• Is infrastructure in place to accommodate system needs?

– Reliability, security, integrity

• Is training required?– For purchaser?– For end-user in the field?

• How well does RM fit into existing business processes?

– Best business models will be easy for customers to implement across the entity

QUESTIONS TO ASK OF AN RM BUSINESS PLANNine Critical Questions


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OPPORTUNITIES BY VERTICAL (I)

Low/Few

High/Many

Maturity today Forces for adoption Challenge/hurdles

•The traditional medical device companies are leading innovation in this field.•However, IT companies are also important players.•There is a visible opportunity for development in the capture devices and monitoring services fields

•Health management costs are high. So, there will be a force towards prevention, as well as the desire to keep the patient home

•Development of smart devices•100% reliability and security of wireless connections•Development of monitoring service companies

HEALTH CARE & MEDICAL

DEVICES


• High maturity • Clients demanding real-time tracking and visibility

• Infrastructure costs high (transmission)

TRANSPORT & LOGISTICS


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• Medium maturity, high in certain areas• RM application integrated with ERP applications

• Major players forcing adoption– E.g. Wal-Mart

• Cost of RFID transponders is still high to fully replace bar codes

OPPORTUNITIES BY VERTICAL (II)

RETAIL & CONSUMER

GOODS


• Increasing demand for RM technologies• Shift from “analog” to digital equipment

• Environmental compliance• High on-site maintenance costs

• Must have new technologies certified for compliance use•Cost/benefit can be unclear versus other alternativesOIL & GAS


•Many large contractors in specific segments

• E.g. UAV

•Opportunities for smaller players in networking existing military equipment

•Bigger federal government spending for RM that satisfies higher security needs in post-9/11 environment

•Better gov’t deployment of satellite, wireless infrastructure

•Ensure security within and between all steps in value chain

•Customize technologies for specific government needs

• Legacy database systems• Rugged military requirements

GOVERNMENT & HOMELAND

SECURITY

remote monitoring: an industry perspective techventures / professor mohan sawhney march 7, 2006...

Documents

industry verticals

rm applications

alfonso yanez slide

behavior slide

network information

common rm

michael dickman

william nicolau