JimPinto.com - Connections for Growth & Success™
No. 278 : 22 February 2010

Keeping an eye on technology futures.
Business commentary - no hidden agendas.
New attitudes, no platitudes.

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CONTROL Top-50 2009 - summary

Once again in December 2009 CONTROL magazine published its list of TOP-50 Automation & Control suppliers - with separate rankings for global and N. America.

Since these are all public companies, the data is about a year old - for their fiscal years 2008. There seems to be no real solution to this "old data" problem. 2009 will tell a different story.

At $87.7B the top-50 grew about 16% in 2008, compared with 17% in 2007. Growth for North America was 4.6% to $22.9B compared with 5% in 2007.

Globally, there was no significant change among the leaders and the top 6 are now: Siemens, ABB, Emerson, Rockwell, Schneider and Honeywell.

There was no change in the top-3 suppliers in the N. American market. Once again, Emerson was #1 on the list with revenues of $3.4B, up 9.6%, and extending market share slightly from 14% to 15%. In second place, Rockwell grew at nearly 11% to $2.9B with market share at 12.5%. In third place was ABB, with revenue of about $2B and minimal growth (3%), with 8.5% market-share. Clearly ABB has shifted to global focus.

In fourth place for N. America was global leader Siemens, with about 3.5% growth to $1.4B. If Siemens wants to grow they'll need to make an acquisition. Can't be Rockwell (anti-trust blockage) but perhaps Honeywell (which slipped to No. 6 (behind Danaher), or Invensys which fell out of the top-10 (now #14) with 10% Lower revenues, behind Endress & Hauser which grew 8.5% to $1.8B.

GE and Fanuc had not broken up yet in 2008, but they were ranked separately, Fanuc is No. 11 and GE No. 12, both at about $1.8B.

Globally, Siemens is still 1.5 times bigger than its nearest rival, ABB, which in turn is more than twice as big as any of the next - Mitsubishi, Emerson and Schneider, all about equal. Japanese Yokogawa is apparently faltering.

The only strategy which would enable the top few to get higher on the rankings is through merger or acquisition. 2010 will be the year of fallout.

Industrial Automation Top-10

North America
Emerson Process
Rockwell Automation
Honeywell Process
Cameron Valves

Here are a few of my favorite mid-size companies, all growing steadily in the rankings to approach the next tier:

  • National Instruments #23 at $ 800M
  • Phoenix Contact #15 at $ 1,735M - more than double its competitor Weidmuller which is #24 on the list.
  • Beckhoff is #41 at $406M, and #49 in N. America at $40M.
  • OSIsoft got just an honorable mention on the global list, but was #35 at $90M on the N. American ranking.
  • Mini-conglomerates (bag of smaller, acquired companies) - Ametek ($1.4B #17); Spectris ($1.2B #19); Roper ($680M #28).
Anyway, take a look for yourself at the CONTROL Top-50 article, which includes the basis on which the rankings were done jointly by Control and ARC. For a more detailed independent analysis, read Andrew Bond's "Automation Insider".

Click Top 50 Automation Companies 2009

Click Independent analysis in Andrew Bond's "Automation Insider":

Click Jim Pinto - Top 50 Automation Companies 2008

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Freemium - a plan for ISA resurgence

ISA Membership has been declining steadily in recent years. Today, there are about 28,500 members, including reduced-dues and non-paying lifetime members and students. The surprise is that USA membership has declined to only about 16,000.

With a plethora of high-content information sources available in the Internet "free" paradigm, paying $100 per year for ISA membership is an anachronism. The dues are simply not matched by the value that ISA purports to provide.

A bridge to the future is possible - offering "freemium" membership for anyone interested in automation, anywhere in the world. These could be non-voting members, with the offer of upgrade to full membership upon payment of regular dues. Look up the word "freemium" in Wikipedia.

There are many way to structure free membership while optimizing value. Freemium members would not be members of an ISA section and would not have any voting rights. But they would be able to contribute content to ISA magazines and blogs, and receive discounts for training and attendance at ISA conferences. This would "cost" ISA very little, and yield significant benefits. It will lead to a much higher level of engagement and greater revenue opportunities.

Regular paid membership will increase significantly as freemium members transfer to full membership through clear value offerings. The regular dialog and conversion results will provide feedback on the value of membership and allow development of new member offerings.

As more and more people recognize the value of ISA membership, the conversion rates (from free to reduced-dues and then full membership) will climb to an estimated 25,000 to 75,000 new members. This approaches the number I previously promoted as a goal and still think is a viable objective.

With a significantly higher number of constituents, ISA would not be wanting for leaders, editorial content and advertising revenue. Indeed, higher readership of online and printed content guarantees increased advertising rates. Many other current shortfalls will quickly disappear.

It's clear that ISA must re-invent itself. Before any meaningful improvements can be accomplished, governance needs to change dramatically, to avoid analysis-paralysis.

But, the conundrum must first be solved: How to get volunteers to relinquish volunteer control? And, how to get an Executive Director that operates like a CEO?

Click Automation World (Feb 2010) -Freemium-A Plan for ISA Resurgence

Click Walt Boyes - ISA: What is there to do?

Click Jim Pinto (2006) - The melting iceberg continues to melt

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Morley & Pinto together at Winnipeg Conference

Winnipeg Industrial Technology Centre, in Canada, provides technical services to Manitoba manufacturers as part of an economic development mandate from the provincial government. The Advanced Technologies group works with local companies to create awareness and the adoption of advanced technologies, to stimulate them to be competitive in the global economy.

Winnipeg has a very diverse economy - generally one of the most stable in Canada during tough economic times. The Industrial Technology Centre has helped small, medium and large companies, home-based businesses, individual entrepreneurs, and various levels of government.

The Winnipeg Industrial Technology Centre has invited me to be a keynote speaker at their Technology Acceleration, Innovation & Manufacturing Conference at the Canad Inns, Fort Garry, Winnipeg, MB, 8:30 a.m. to 12:00 p.m. on March 3, 2010.

As a Technology Futurist, my topic will be: "Manufacturing in the Global Age". I'll be joined in this program by Dick Morley, famed technology guru, inventor of the PLC, founder and investor in lots of high-tech startups. Dick Morley's talk will be "Beyond the Leading Edge: Technology in the New Millennium".

So, my old friend Dick Morley and I will be on stage together. Following our two talks, we'll have an open discussion on "High Value Manufacturing in Manitoba", and "Business Strategy & Technological Innovation: The Entrepreneur's View".

If you're in Winnipeg, Canada, or anywhere near, come to witness the Pinto/Morley fireworks. You'll be glad you did.

Contact: Betty Dearth, Winnipeg Industrial Technology Centre
Phone: 204.480.0336; Fax: 204.480.0345
Click E-mail: bdearth@itc.mb.ca

Click Winnipeg Industrial Technology Centre

Click Jim Pinto - 1 minute sales pitch (video)

Click Pinto Topics, Testimonials and recent speaking events

Click Jim Pinto - speaking engagements (video)

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Apple iPad defines new uses and markets

Hey, I predicted the name - Apple's new iPad has arrived. It's powerful, pretty and threatens to obsolete lots of other consumer devices while it builds new uses.

Instantly, the debate began: Is this a computer or a mobile device? Is it an e-reader or light laptop? Is this tablet really different? Apple clearly likes these questions, and expects to sell millions of new iPads for these already defined function, and many more. The iPad aims to remake a market touched by laptops, tablets, netbooks and iPods. It's a portable device for the creation and consumption of media.

Apple's iBooks store (with cheap best-sellers and wireless downloads) is a competitor for Kindle, and the big question is whether the iPad will build a market on top of Kindle, or dent its success. iPad's e-reading application features flick-of-the-finger page turning and variable fonts - tricks Kindle can't match. Meantime, Amazon says it has actually sold more Kindle eBooks than print books in the last quarter.

At $499, the iPad is cheaper than anyone expected. But it remains a multipurpose device with a multipurpose price - $130 extra for a 3G modem and $30 a month for unlimited wireless access. That makes the Kindle's still falling $259 price - including unlimited wireless - seem good, especially for those who want simple reading and already have computers and music on other gadgets.

Technically, iPad is clearly better than Kindle. Apart from Kindle's longer battery life with e-paper, iPad is entirely in a different class - it can display color, is fast enough to display video, holds eight times more storage, and also has the advantage of Wi-Fi. The key is that iPad builds on the vast iPhone apps library, plus full media player, e-mail, advanced games, and maps.

For most people, this is a liberating trend. You can now choose one gadget instead of three. If you carry a laptop, a phone and an MP3 player, now you can carry one device, the battery lasts most of the day, and certainly for a long airplane trip.

Hey, I like my iPhone a lot, and use it to show all my recent pictures to friends and family. Now I can show all my pictures in a dazzling, bigger display. I'll have to wait till the end of March to show off, because that's when the iPad becomes available. I've put my order in through Amazon, which will get me in line automatically.

Click Apple iPad: One heat seeking missile aimed at netbooks, e-readers

Click Apple's iPad vs. Amazon's Kindle: It's not zero sum

Click Google And The iPad - Apple's new device raises the stakes

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Pinto prognostications - global financial futures

Following the trillion-$ "stimulus", the big banks are doing well again, and the stock market appears to be inching up. But, in my opinion, the fundamentals have NOT been corrected and more financial disruption is coming.

The big financial institutions have re-balanced themselves with lots of shabby chicanery - hair-trigger late-fees on credit-cards, high interest rates on questionable loans, and yet again, trading in high-risk derivatives. New credit-card laws come into effect on Monday (22 Feb. 2010) but those are trivial barriers that are easily avoided through legal artifice.

Meanwhile Congress fiddles, while America burns.

Many astute financial analysts predict a larger than previous shock later this year (2010). There are only 2 possibilities:

  1. The world's economic problems are largely solved, except for more unemployment, which will be left dangling.
  2. A financial after-shock even greater than the first, with no hope of further "stimulus" because the world has already "been there, done that".
If you want to understand the background to all this financial mess, go to Chris Martenson's website (weblink below) and watch his "Crash Course". As Chris says, the system will continue going until it crashes - inevitably.

The big question is whether this next crash will result in much more profound change, shifting the world to a completely different status. In his book, "A Vision for 2012", John Peterson discusses the cycles of American social history which predict a major disruption of the magnitude of the Great Depression.

We are living in a time of unprecedented, exponential change - population growth, species depletion, science discoveries, natural resource usage, technological invention, and information and knowledge growth, and more.

The system in which we live is getting far larger and more complex at such extraordinary rates that it's getting beyond human ability to understand or control. There is no precedent. The "experts" do not have the history or experience to suggest solutions.

And so, world leaders put on a brave face and pretend that everything is OK, hoping for the best.

As a futurist, like a weather reporter, I'm simply highlighting the indicators that point to the coming shift. But, beyond that, you and I must find ways to deal with what is likely to happen.

I can't presume to suggest a plan to cope with what may come. I do suggest, however, that you do your own research, to build your own plan. The Internet has lots of stuff on this subject - and you know how to use Google.

Click Watch Chris Martenson's "Crash Course"

Click John Peterson Book - Vision 2012

Click The Future of Capitalism

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Rick Lamb [relamb@midtechv.com] saw the TV broadcast, "Future of Manufacturing" and sent these comments:
    "It was an interesting start, but I didn't see any clear direction or action items coming out of it. Higher Tech/Higher Value manufacturing is good, and selling your product around the world, as Immelt suggested, is a good plan, but that doesn't give those unemployed steelworkers a paycheck in the next 3 months.

    "Those initiatives take a lot of time and resources to develop. Retraining? For what? Even if you sat 100,000 steelworkers down and retrained them tomorrow, where's the job they're training for? There are unemployed people already trained that can't get a job.

    "I think we need to bring back some of the lower tech manufacturing. I just don't see there being enough high tech manufacturing jobs to keep the working population employed. We need a training ground, where people can develop their skills and move up. Assembling Tab A into Slot B is still decent work for those of us who aren't rocket scientists. It may not pay well, but it pays something and it's definitely an experience for younger workers on their way to learning more skills.

    "I've always been against outsourcing plants and production to cheaper third world labor (less strict labor laws, poor working conditions, fewer environmental regulations). Keep it here, enforce that our labor and environmental standards be applied to imported goods, and let immigrants come in and fill the low paying, grunt labor positions. That's what made America the power that it is - low-level opportunities as a starting point, with the ability to work your way up.

    "We should strive for providing high-tech, knowledge intensive, world-class manufacturing opportunities, but we also need to provide mid-range technology, somewhat labor intensive opportunities for our 'asymmetrically un-motivated' lower and middle class. There's got to be something in the middle between world class technologists and burger flippers."

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Corson Ellis [corson.ellis@kepware.com] is angry about the continued rip-off by Wall Street Banks:

    "When are you going to talk about Wall Street bonuses? Six months after paying off their bailout money, taken on because of their completely irresponsible behavior selling unsustainable financial mortgage instruments based on the idea that real estate prices will NEVER go down, Goldman Sachs and their friends, rescued by the government, paid off the money, and paid themselves $20 million bonuses. All this while people in America are hurting.

    "They are bringing on a challenge to the capitalist system, giving it credibility and momentum. Capitalism needs a moral underpinning. Leaders have to act not just out of greedy motives, but for the general good of their businesses, communities, employees, and the nation.

    "Their greed is seeding dissent and anger at Wall Street, threatening the very system that is rewarding them, while you and I struggle to grow companies, actually MAKE things and sell them, not just skimming a large piece of the capital off the backs of our workers."

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John Yolton [jyolton@pacbell.net] provides a contrarian's view of the eBook revolution:

    "As an aged technocrat who spends a lot of time on airplanes and in airports I read a lot, and prefer hardbound books, so when Kindle showed up I thought this technology is the answer, no more bulky books to further expand an already expanded carry on; no more perusing the airport or Costco book sections.

    "And then I thought about all the people depending upon me for their future second-hand reading material. Much as the e book makes sense, it's widespread use could create pockets of literature hunger for those without the technology. I am part of that chain passing along scores of books per year. Not to mention the fact that books are carbon traps/sinks.

    "Notice: It's OK to print this e-mail. Paper is a biodegradable, renewable, sustainable product made from trees. Growing and harvesting trees provides jobs for millions of men and women, and working forests are good for the environment, providing clean air, clean water, wildlife habitat, carbon neutral energy and carbon storage."

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