JimPinto.com - Connections for Growth & Success
No. 5 : June 15, 2000
- GE & CISCO Partner on Industrial Networks
- More on Invensys & Baan
- Agilent gives up on Industrial Ethernet
- Hot book : 11 Immutable Laws of Internet Branding
- Automation & Marketing Discussion Lists
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.
Robert Old, Siemens Building Technologies, comments :
Their objectives include "integration with existing factory
automation and control systems" - which I've always thought
was the hard part.
Jim Pinto : It will be interesting to see how GE-Cisco handles Fieldbus, Profibus, ControlNet, DeviceNet and the vast proliferation of
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) :
The deal benefits Baan, its discrete manufacturing ERP customers and
Invensys. With Baan a part of its new ISS division, Invensys takes a large step forward with its “sensor to boardroom” strategy. Baan is selling at or close to the best price it could have hoped for and gets the satisfaction of knowing that its core products will continue to be developed. Baan's manufacturing customers can breathe easier given the renewed viability of Baan's core products (ERP and manufacturing supply chain planning, or SCP). Invensys’ financial strength, discipline and previous acquisition experience bode well for a renewed, financially stable Baan to emerge.
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.
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