role of edge in enabling digital transformation within the ...€¦ · companies can be hesitant to...

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Role of edge in enabling digital transformation within the industrial sectors

Yesmean Luk

Senior Consultant, STL Partners

IoTHINGS Week 2020, Edge Forum

26 May 2020


Previously, enterprises either hosted applications in a data centre or software was integrated into the appliance


Edge computing allows enterprises to deploy applications closer to the end-user/source of data

✓ Low latency

✓ Reduce bandwidth costs

✓ Data localisation

✓ Increase flexibility & scalability

✓ Reduce vendor lock-in

✓ Reduce cost (and size) of infrastructure

✓ Improve application mobility

✓ Data security


Another way of looking at the benefits of edge is combining the capabilities of both local and cloud computing

Local compute capabilities

Cloud compute capabilities


Where is the edge? Depends on who you are or who your customer is

Enterprise Access Point Access NetworkEnd-device Transport Core Network Internet

Edge computing

Network edge/multi-access edge computing

On-premises edge

Device edge

Location of compute workloads/processing

Edge computing brings processing capabilities closer to the end user/device or the source of data


Different industries more/less suited for different types of edge

Network edge On-premises edge

Manufacturing

Agriculture

Construction

Defence

Emergency Services

Extractive Industries

Financial Services

Government

Healthcare

Logistics

Media & Entertainment

Retail

Professional Services

Tourism & Events

Transport

Utilities

Defence authorities often deal with sensitive and

confidential data and thus require private networks for data security purposes.

Private networks are very expensive and complicated to set up, which limits the

usage to large corporations and government entities

MEC to ensure minimum communication delays between

traffic controllers and ambulances, and private networks for fast, secure and reliable connection (e.g. – ESN)

Autonomous vehicles for instance require MEC for the extremely low latency to trigger real-time actions

to prevent accidents

Potential use of both MEC (for remote monitoring) and private network (for patient

data privacy purposes)

MEC for real-time 3D design collaboration, and private network for sensitive data

protection (new innovative design) and faster network deployment for

construction sites

Lack of network coverage for oil & gas industry as they often use satellite -

need for private networks to reduce downtime

MEC allows improvements in multiplayer gaming

experience and AR/VR by dramatically decreasing lag


Edge computing is a key part of enterprises’ digital transformation

Improving efficiencies New business models

Reducing waste and defects

Increasing asset lifetime

Minimising time / maintenance &

repair costs

Run operations more efficiently

(automation)Servitisation

Data-driven product

development

Our digitalisation and innovation initiatives focus on becoming more efficient, reducing downtime and reducing bottlenecks.

Major automotive group

The focus is always going to be on greater control and automation – the stuff owned by the OT guys – they’ve been doing this for forever and a day.

Edge platform provider to manufacturing & extractives

At the end of the day, it is all about how we can improve services we provide to customers, on top of the products they already have out there.

Leading aero/auto engineering group

We can now move towards a leasing model where batteries are leased for an amount of time so the customer won’t have to worry about having to replace the battery – it’s already in their contract.

Leading battery manufacturing group

In mining, customers buy every dime that you make. As soon as something stops working or stops the supply chain, you start bleeding cash.

Leading oil, gas and mining group

The focus is always going to be on control and automation – the stuff owned by the OT guys –they’ve been doing this for forever and a day.

Edge platform provider to manufacturing & extractives

We have our own role in helping our customers to reduce the cost per barrel through the services we provide, so digital transformation is a part of that

Leading oilfield services provider


The key drivers for edge computing depend on industry-specific factors: e.g. mission criticality, regulations etc.

Factor ManufacturingOil, gas &

miningConnected Car Smart cities Healthcare Retail Logistics

Low latency & reliability ✓ ✓ ✓ ✓ ✓ ✓ ✓✓

Reduced backhaul ✓✓ ✓✓ ✓✓ ✓✓

Data localisation ✓ ✓✓ ✓ ✓✓ ✓ ✓

Scalability ✓ ✓

Light device ✓✓

Mobility ✓

Resilience ✓✓ ✓


Most new use cases are still at an innovation/early adopter stage of using edge computing/cloud

Innovators Early Adopters Early Majority Late Majority Laggards

Autonomousdriving (V2X)

AR/VR

Traffic management

Customer engagement

Electric vehicle energy mgmt.

AR/VR

UAV inspection

Remote monitoring

Equipment monitoringPredictive

maintenance

Location tracking

Video analytics

Remote operations

IT/OT

Security

Warehouse mgmt. systems

OTAupdates

Asset tracking

Cloud gaming

Remote patient care

Web optimisation

Use cases such as asset tracking in vehicles and on-prem IT systems have existed for over a decade

However, we are still at an early stage of seeing new use cases and enterprises implementing distributed/edge cloud

Still some uncertainty of the future use cases – making the right infrastructure decisions is key


How is edge compute being deployed? Both brownfield and greenfield deployments

Network edgeOn-premises edgeDevice edge

Condition monitoring

Remote operations

IT/OT

Security

Equipment monitoring

Warehouse mgmt. systems

Traffic management

Customer engagement

Autonomousdriving (V2X)

Electric vehicle energy mgmt.

OTAupdates

Asset tracking

AR/VR

AR/VRPredictive

maintenance

Location tracking

Video analyticsUAV

Insurance “black box”

Server/gateway

Roadside units

MEC data centre (base station)

Brownfield

Greenfield

Key

Programmable logic controller (PLC)

Server (“edge in a box”)

Rack

On-premise data centre


Rack



Server/gateway

Rack



In order to accelerate edge computing adoption, these barriers need to be overcome

IT vs. OT decision-making responsibility

Education and industry cultureData compliance

and regulation

Making the business case: cloud vs. edge

It’s not always clear who in the organisation makes infrastructure decisions, and who the

edge solution should be sold to. Some players (e.g. hyperscalers) tend to approach edge

from an IT perspective, assuming that IT=OT.

Even in digitalised industries, ‘dinosaurs’ exist. Education is needed industry-wide, both

to change the mindset of technical people who are resistant to change, and to combat the skills gap between different generations.

Data regulation is changing all the time; companies can be hesitant to process data at the edge and only send aggregates or insights

to the cloud and risk losing valuable information required for compliance.

Edge may bring new costs e.g. on-site and/or distributed infrastructure management –

which can be hard for cash- strapped industries to justify unless there is a clear business case for using edge vs. cloud.

Fragmented partner ecosystem

There is no single leading partner within the edge partner ecosystem. The ecosystem

ranges from the more traditional hardware providers (e.g. those who sell PLCs), industry-specific start-up companies, general Sis, etc.

Edge hardware for OT/industrial/enterprise needs

Much of edge is about bringing IT into OT, however this is not a simple copy and paste. Hardware needs to evolve to meet industrial needs (e.g. ruggedised equipment; limited

capacity in branches/retail stores, etc.)


There are different roles that players can play within the wider edge ecosystem and value chain

Cloud Infrastructure

Network

Facility

Application/Software

Hardware

Integration & Systems Design & Engineering Systems Integration Professional Services

Real Estate Data Centre Power & Cooling Site Maintenance

Processor ServerEnd-device Hardware Maintenance

Cloud ConnectContent & Application

DeliveryEdge Gateway

PaaS Analytics & APIs Software Application

Operating System IaaSCloud Aggregation &

OrchestrationVirtualisation & Containers

Open Source & Forums Open Source Forums & Communities


So, what’s next? How should companies kickstart their edge computing journey?

Build a business case• Define your business drivers / KPIs for using edge (cost, performance, agility)

• Assess which applications need to use edge and which will need cloud across IT & OT

• Evaluate the investment required to implement edge computing

1

Define your guiding principles to future proof infrastructure• You won’t know what your edge applications will be from Day 1

• Avoid mistakes of the past – less proprietary, more open infrastructure

• Flexibility is an inherent benefit of cloud – bring it to the edge

2

Select the right partners• Different technologies are coming together partners will need to support – 5G, IoT, AI

• The right partners are those who are engrained in the ecosystem and can bring others too – across applications, software, hardware and services

3


Thank youPlease feel free to reach out if you have any

questions:

[email protected] Research Consulting Events

Find more of our edge insights at

www.stlpartners.com/edge-computing

@STLPartners

linkedin.com/company/stl-partners

mailto:[email protected]


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STL has built a centre of excellence around edge computing and been advising businesses on this for over 3 years

Unrivalled expertise and experience……and an industry-leading edge knowledge centre

Supported 3 major telecoms operators to develop a commercial strategy for edge computing

Interviews with over 50 enterprises and solution providers across different industries

Team of experts: leading industry analysts and consultants, IoT practitioners & cloud specialists

Advised global telco on hyperscaler partnership negotiation worth €0.5M

Database of 150+ use cases for MEC, private networks edge and

on-premises edge

Interactive model for forecasting use case revenues

Ecosystem tool mapping 80+ vendors across the edge value

chain

MEC site ROI model & hyperscaler negotiation tool

“STL brings edge expertise. They understand that

landscape across telco and other ecosystems.”

“We worked closely with STL in true

partnership to deliver high quality, actionable insights that were not available elsewhere.”

“The consulting team produced high-quality output that could be repurposed in a wide

variety of ways.”

Year

2019

2020

2021

2022

2023

Data Type

Annual revenue

Value chain segment

Application

Connectivity

Edge Cloud

Hardware

Integration & Support

Country

Germany

Italy

Spain

UK

0

100

200

300

400

500

600

700

2019 2020 2021 2022 2023 2024 2025 2026

EU

R m

illio

ns

Integration & Support

Application

Edge Cloud

Connectivity

Hardware

Industry

Energy & Utilities

Manufacturing

Natural Resources and Agriculture

Other

Retail, Media and Events

Use case

Real-time UAV a...

Immersive experi...

Drone detection

AR in tourism

Head of Cloud Edge -European MNO

Product Manager - global software company

Head of Commercial & Partnering - Global MNO

role of edge in enabling digital transformation within the ...€¦ · companies can be hesitant to...

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