Growth & Success eNewsletter June 15, 2000

JimPinto.com - Connections for Growth & Success™
No. 5 : June 15, 2000

GE & CISCO form new industrial networks company

GE Industrial and CISCO have formed GE-Cisco Industrial Networks, based in Charlottesville, VA. - the HQ of GE-Fanuc N.America. The new company will "assess, design and build network infrastructures for manufacturing plant floor and industrial environments that will enable enterprise-wide communication". (from press-release)

GE Cisco Industrial Networks combines GE knowledge in industrial applications with Cisco's Technology in Networking. The two companies have the largest valuation (market-capitalization) in the world today. This is the best indication to-date that Ethernet has arrived as an industrial network, linking the factory floor to the office.

Visit the GE-Cisco website

The GE-Cisco Press-release

CNNfN new article - view from the financial world

CMP Techweb analysis

Robert Old, Siemens Building Technologies, comments :

"integration with existing factory automation and control systems"

Jim Pinto : It will be interesting to see how GE-Cisco handles Fieldbus, Profibus, ControlNet, DeviceNet and the vast proliferation of industrial networks.

INVENSYS & BAAN - second take

In the last eNews, we featured the Invensys agreement to buy Baan and form a new, $2 billion Invensys Software and Systems (ISS) division. The plans are to cut about 1,000 jobs and after $400 million in restructuring charges, Invensys expects to achieve break-even for Baan in 12 months and return it to profitability in 24 months.

Observers noted that Baan is worth more broken up (about $4.80/share), than Invensys is paying for it (about $2 less) and there has been much flack in the financial community from the institutional investors in both companies about this. The deal will most likely go through - but many feel that the depth of the crisis means that Baan's days of being in the same league as SAP, Oracle or JDE are over.

The "first take" from well-respected Gartner-Group says (extracts) :

But Invensys' core competency of addressing manufacturing operations within the enterprise is not well aligned with the demand to deliver interenterprise solutions. Thus, Baan customers should expect future e-business capabilities to be delivered later than Baan's competitors. While Invensys has said publicly that it will not sell the Baan customer relationship management (CRM) subsidiary, through 2003 Invensys will struggle to make Baan CRM competitive. Overall, Baan customers can expect fewer leading-edge technological developments and functional enhancements outside of discrete manufacturing.

Agilent gives up on industrial Ethernet

The following is a "Discontinuance Notice" from Aligent, till recently Hewlett-Packard, now a spin-off with Test & measurement focus.

"This letter is an update to users of Agilent BFOOT-66502 and BFOOT-11501 modules. I'm sorry to say that, after a careful re-assessment of the slow-to-develop distributed measurement and control market, Agilent has determined that there is insufficient demand for these devices. As a result, Agilent is discontinuing these products with immediate effect."

Bob Nickels, Honeywell Sensing and Control asks :

"Is Agilent just ahead of their time? Or, is Ethernet a great solution for linking controllers, and maybe even for remote I/O, but will never become the technology that will "put sensors, actuators, instruments, and machines onto Ethernet networks and the Internet.?"

Jim Pinto responds :

No, Agilent was NOT ahead - fairly right on. My opinion is that there is simply not enough volume in the industrial automation business - at least, not when compared with other markets. Ethernet will become a large part of industrial automation networks, but embedded with other protocols with good connections to TCP/IP and the Internet. All industrial networks already have, or will have, Ethernet options, which will become mainstream.

Dick Caro, Vice President of Automation Research and industrial networks guru, comments :

"While the work on BFOOT to implement IEEE 1451, was technically sound, it competed directly with developing international standards such as Foundation Fieldbus and Profibus. Most of 1451's benefits are offered by the function blocks and profiles of these standards, OPC, and the profiles which are also part of Ethernet-IP, recently announced by ODVA and ControlNet International."

Hot Book : 11 Immutable Laws of Internet Branding

Al Ries, the Marketing guru (classic : Positioning - the Battle for Your Mind) and his daughter and now co-author, have come up with a new book (May 2000). The 11 "immutable" laws are counterintuitive and debatable, but nevertheless make excellent marketing sense. Only history will tell us if these laws are truly immutable, but one thing is certain now: there's not a paragraph that isn't provocative in some way. Read it! Or, you might like to listen to an audio-tape in your car - good way to absorb this excellent marketing discussion.

Browse my review of this book, and other suggested reading

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