We are experiencing a data explosion around the world. With record numbers of new devices connecting to the internet every day and professionals demanding to be connected to their critical assets. We talk with connectivity and data center experts Magy Kramer and Debbie Mallally to get some insights.
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Lou: We are experiencing a data explosion around the world. With record numbers of new devices connecting to the internet every day and professionals demanding to be connected to their critical assets. How are manufacturers responding to the demand? How are Data Centers positioned to support these demands.
Today I'm delighted to have, for the first time, two guests to help us better understand the need for connectivity and the data boom.
First let me introduce a returning guest: Magy Kramer. Magy is becoming quite the regular here on Power Bytes. She has two episodes focused on the importance of connected critical assets and how Caterpillar is enabling users to stay connected. Welcome Magy.
Magy: Thanks Lou, thanks for having me. I am excited to be here with you and a new 2nd guest! I am excited to be collaborating with you all.
Lou: My second guest is Debbie Mullaly. Debbie has a BA (Hons) in Business Studies and an MA in Marketing from the University of Ulster. She has been with Caterpillar for 16 years. Debbie currently works as a Growth Strategist in the Electric Power Division with responsibility for the strategy and evaluation of new technologies for the business and aftermarket services. Most recently Debbie has been focused on the evolving power demands of the Data Center business.
Lou: Welcome Debbie!
Debbie: Thanks Lou, great to join you and Magy today.
Lou: So as we connect more and more devices, Magy, what are you hearing most from your users about their needs?
Magy: Our user's needs are very consistent and their problems remain the same: Lower owning and operating costs, Make sure my Generator Set is ready to Run and Give me the peace of mind that my operations will stay operating. It is how we are solving these problems that are ever evolving. The diversity of things being connected to the internet is amazing. There are bridges with sensors to detect structural damages all the way to hand washing stations detecting when someone is washing their hands and logging their badge information to prevent the spread of diseases. In 2020 there are about 10 Billion IOT devices and some say it will grow to 24 Billion in 2030.
Lou: Debbie, I'd like to turn to you for some level setting. What, in terms of demand, are the data centers experiencing in terms of growth?
Debbie: Thanks Lou, interestingly data centers have the same concerns - lower my owning and operating costs and guarantee my uptime. However as Magy says the demand for being connected compounded with the growing demand for ongoing connectivity and Artificial Intelligence or (AI) across homes, businesses and cities is seeing a surge in growth across the data center industry. This is before we really see the integration of electronic vehicles and the impact of the Edge Data Center … there is much more to come with the demands on data centers to grow exponentially.
Lou: Magy, what are the latest developments on the Cat Connect front? How is Caterpillar responding to customer demands?
Magy: I mentioned that IOT devices are projected to see about 11% growth until 2030. In the OEM telematics space, where I play, the forecast is 21.3% annual growth. This means more and more customers are seeing value in remote monitoring of their generator set. They see connectivity not as an additional service but a mandatory part of their overall maintenance and operations strategy giving visibility to potential problems that could stop them from being successful. Have you ever read visitor reviews on hotels? Security and Relaxation can be lost for a customer whose hotel loses power for a night or a couple of hours which in turn makes them leave a review effecting that businesses reputation. We are partnering with our sales and technical teams to make sure connectivity is considered as part of the design of the generator system or part of the maintenance package, what we call Customer Value Agreements (CVAs). This ensure our dealer network has the right part at the right time, the first time. The reports that Cat Connect creates showcases the progress seen with connectivity and recommendations for the future to ensure peace of mind for all stakeholders of the customer site (Maintenance, Sales, Manufacturing to the customer)
Lou: Magy, are you seeing growth in any particular geographic areas?
Magy: Honestly we are seeing growth of connected assets in all areas from Europe, Africa and Middle East to all of the Americas and in Asia. There are different local challenges in each of these areas but decreasing unscheduled downtime and lowering costs are everyone's top priority. Cat Connect saw a 45% growth last year showing how customers are thinking differently on how they do their work which includes having the data they want, when they want it and how they want it all with an expectation that it is secure..
Lou: Debbie, same question. Does the growth in the data center world align with the demands seen by the Cat Connect team?
Debbie: Absolutely, digitalization is a megatrend that is impacting the world and the resulting power needs to realize this demand is transforming the data center industry across hyperscale, colocation and of course the evolving edge. In fact the global data center market size is set to grow by $284.44B during 2019 - 2023 - that's a CAGR of over 17% (Technavio)
Lou: I'd like to turn our attention from an adjacent topic, that of security. Users have an expectation that their data is secure, how is Caterpillar meeting this need with Cat Connect?
Magy: Users have multiple stakeholders making decisions on their service offerings including connectivity. IT departments are very interested in how Caterpillar handles and secures their data with Cat Connect. These types of conversations support the overall sales cycle requiring a close partnership between Caterpillar, the dealer and customer. Cat has a very robust data and security principles to ease the minds of our users.
Lou: Debbie, I'm sure data centers are keenly focused on security as well. What are the key focus areas?
Debbie: Thanks Lou, yes, there are extensive requirements for security, governance and compliance - this is a fact of data center life and quite frankly their reputation. Data Centers are very aware of security concerns, especially as the adoption of public cloud computing continues to surge - more recently compounded by the Covid pandemic and the shift to remote working for large numbers of people.
The top three security concerns are 1) the risk of data loss and leakage, 2) threats to data privacy and 3) dealing with legal and regulatory challenges. When you see this list - and this is only the top three - you can see why security is paramount to a Data Center's business and reputation.
Lou: Magy, what would you say is the key deliverable Cat Connect Users?
Magy: Flexibility of our Cat Connect solution is key. Listening to our user's problems and then putting together a connectivity offering that meets these needs. This could mean connecting the gen set to receive real time fault codes when a state changes or this could mean pulling in a customer's monitoring system into Cat Connect to run reports, analytics and monitoring services to help with forecasting. Or flip it upside down, I have seen customers agree to Customer Value Agreements (CVAs) because of the complimentary Cat Connect offering that is behind it.
Debbie: If I can jump in - just when I hear Magy mention real time management capability - I thought it might be a great time to speak about the increasingly adoption of AI within Data Centers themselves to help cut costs, minimize management challenges and ramp up sustainability efforts. One example is the use of advanced, connected lighting systems that have sensors on each luminaire to detect motion, brightness, temperature and even power consumption per fixture. Delivering this data in real time allows the Data Center to best manage energy usage depending on space occupancy. Another example is the use of AI reporting for HIVAC systems that in some instances have realized a +30% saving - not only a great energy saving but a great way to cut down on your bills.
But you are absolutely right Lou, the world is getting connected with expectations to get rich data at the tap of a button or with a simple voice command – the complexity behind these simple actions is transforming the data center industry across service and performance levels, business and finance models. This is a very exciting and transformative time for the industry.
Lou: This has been a great discussion. Magy, any final thoughts?
Magy's closing: I challenge our listeners today to take a moment to further educate themselves on connectivity, this could be the moment that makes their lives easier. Hind sight is always 20-20, if we make the change now for our future, we won't have to look back. The best information can be found on cat.com, search for EP product support or Electric Power Product Support and you will see Remote Asset Monitoring.
Debbie closing: I couldn't agree with Magy more - this is the time to get ready. The Data Center Industry is transforming across so many different apsects. One on side you have digitalization bringing an enormous surge in demand. As 5G comes on board and decentralization takes a more unified form through Edge Data Centers and efficiency gains continue to improve across IT load and advanced processors - the change is enormous and this only scratching the surface … Keeping pace with these changes and offering the most efficient and cost effective service has to start within the walls of the Data Center themselves and this Is already well underway with much more to come.
Lou: There you have it folks. I'd like to thank both Magy Kramer and Debbie Mullaly for sharing their expertise with us today. And thank you, our listeners. I'd also like to echo Magy's challenge to visit Cat.com and search EP Product Support or if you want to read about some actual case studies search Electric Power Cat Connect. Either way, we hope you'll have a look.
If you’d like to suggest other topics for the program or have some feedback to share, please write us here at [email protected] or visit Cat Electric Power on Facebook or LinkedIn. Please remember to subscribe to our Podcast wherever you listen to your favorite podcasts. Till next time, thanks for listening to Power Bytes and have a great day!