 From San Francisco, it's theCUBE, covering OSISoft, PyWorld 2018. Brought to you by OSISoft. Hey, welcome back everybody. Jeff Frick here with theCUBE. We're at the OSISoft PI World 2018, about 3,000 executives here, Downtown San Francisco, talking about operational technology. We talk a lot about IT on theCUBE and the merger of IT and OT, but these guys are really coming at it from an OT point of view first, and they've been at it for 40 years, so we're excited to be here, talk to some of the partners, practitioners, and really get insight into what's going on into this industrial IoT, because a lot of it's happening here. And our next guest is Todd Nadey, he's a global VP of energy programs for Nokia. Todd, great to see you. Thank you very much, Jeff. And we're also joined by Michael Konellius, the IoT analyst from OSISoft. Michael, great to see you. Thank you very much. Absolutely. So first off, Nokia. You all know Nokia phones, we all have the flip, it's still everybody's favorite. What are you doing in the energy business? Well, believe it or not, we have been in the energy business for many, many decades, and we work on the OT side of the house in the mission critical environment, which is why we're not often seen, but very mission critical. We work across both energy companies that are in the mining oil gas, as well as the electric utility sector, encompassing distributed energy resources, generation, transmission, distribution, and the like. Right. So I know what GE does in those spaces, they make the turbines, they make the trains. What do you guys do? Where do you play in that ecosystem? We provide the pervasive connectivity for all of the mission critical communications that allow them to run efficiently. Today, the world has changed for most of our energy companies because their business models are under attack, and so they are forced to transform. And what we do is we are allowing them the ability to have a technology platform off which they can pivot, not only to be able to respond to the threats to the market, but also the opportunities in a very quick fashion. Right. So it's a digital transformation in energy. So we think obviously of renewables, right? Is growing like crazy, and the wind turbines are all over the place. What are some of the other ways that they're really kind of under fire? Is it, you know, mission standards that are getting tougher? What are some of the things that they're telling you they need help with? Yeah. Well, you mentioned regulation, so obviously regulation has gone up. You have changing of regulation that takes place so they need to accommodate that in very short notice, but you also have a very interactive environment where it used to be one way, we're now two way, and now you have communication coming from all of its participants in the market. So these participants are not only their customers, these participants are also third parties that are now come to play in their market, which used to be a captive market. Right. So for them, it is an environment that is two way and a large volume of data and information transacting and they need to be able to make sense of that data and be able to act on that data. And what we do is we provide that pervasive connectivity so that they can have that communication. And they're also looking for new revenue and business models. I mean, if you think of utility, everyone's getting more efficient. So actually the sale of electrons actually going down in a lot of areas, but they just can't go to the next city over. Right. So they're doing things like doing consulting services or doing like even selling their own software to just new ways to develop, you know, take that know-how they have and see if they can get revenue that way. Right. So we talk, we had a lot of IT shows, not as many OT shows and obviously cloud data centers is a big topic. And if we've all seen pictures of the beautiful colored pipes inside of a Google data center or an Amazon data center that they share every now and then, it's not quite the same in the industrial IoT space, right? These machines, you talk about environment, it's like literally environment. It's rain and storms and hail, bad weather, no connectivity. So I imagine you guys, I think you said before we turn on the cameras, you guys are offering private LTE and all sorts of solutions to help get that connectivity out of the data center and really out to the edge and these big devices on the edge like locomotives and turbines. Yeah, absolutely. Yeah, yeah. So what we've found is there's been a confluence of many things in the market. We've seen the price of technology has gone down significantly. You have a scenario where the cost of technology and the feature functionality. So the cost of technology has gone down but the feature functionality has gone up and we see a disruption in the market with regard to how their business models for our customers are coming to play. So they're adding and subtracting assets. The key right now for our customers is they got to get a volume of data. They got to get the volume of data in so they can process it. We are involved not only in the cores of the network but on the edge with machine edge computing. We have the visualization of data that has become very much important to our customers so they can make decisions. This is not only with regard to current assets but then you also have your DER assets that can take many forms. Those DER assets can be around from. What's a DER asset? A DER asset, wind, PV, solar. Okay. Distributed. It can be a micro nuclear facility. It can be a combined heat and cycle plant for example, a gas plant. So these are more distributed and they're more voluminous and they need to be able to communicate with those entities and those assets not only for their health but also to be able to manage the grid for which they're responsible. Right. It's really interesting things. We've heard a number of times, we always hear and more today about preventative bayonets. It's still unplanned downtime. It's still a big giant issue and still costs more, probably costs more than it ever has because of the efficiency you lose something don't quite have as much backup and redundancy as used to have back in the day. So it's amazing that that's still such a big business use case to get out ahead of the curve on these assets. Wind is like the poster child for that and you think of a big wind turbine. There's like thousands of moving parts inside there, right? Any of those could break. Right. And if they do break, you have to sometimes take the entire turbine down, take it back to the shop and bring it back up. So if you can do it in advance without doing major heart surgery on it, that's fantastic. The other thing is just adding more sophistication into the generation and into the consumption based on the broader demand so that you can take advantage of cheaper rates at night or pump back into the grid when the rates are high. So it's the amount of technology out to the edge to start to control these devices to pump that energy back into the grid. It's got to have changed significantly over the last couple of years. Yeah, absolutely. And it's disrupting, it's not only disrupting the energy companies themselves, it's disrupting the client because you got to remember the energy companies, they don't want to be caught without enough power. So they have to buy that power. They have to manage many more varied assets. Again, it's two way. And then you also have the customer experience where customers are demanding specific types of energy. So you may have customers that want clean energy, they may want the cheapest, they may want hydro. So that interaction real time is the world that we are in right now. It's not a future world, it's the world that we're in right now. So the retention of my customers as an energy company is very, very important because they're the ones that pay the bill. That environment is where we are living today, highly interactive environment, highly autonomous environment and providing that connectivity, the pervasive connectivity to enable that, whether it's machine to machine, whether it is client to customer and vice versa, it's really an any to any environment and that's what we set up. Right. It's costing too, just to add on that, like the energy storage battery system, if you have a lot of data that can actually install a smaller battery system and then take a little tinier sip so it actually lasts longer, so actually your return on investment can still massively weigh up if you're actually using the data correctly. Well, the funny thing when you said clean energy, I thought you meant clean, like clean for the machines to be able to execute their operation well, like they get in a data center, right? Which is very different than out on the edge in a field, in an energy field or on the edge of a turbine where you don't have all that control like you have in a beautiful pristine data center. So it's a very different world out on the edge. So Todd, last question, what are you doing here at PyWorld? What's kind of the vibe? What do you hope to accomplish? What have you seen and heard in the hallways that has Nokia here at PyWorld? Yeah, PyWorld's very interesting for us and the reason it is is because the conversation here is different. When we're dealing with clients here at PyWorld, it is about solving something, right? It is about the use cases, it is about their business, it's about their balance sheet and less about what you manufacture or sell. And so these conversations are driving what it is we do. We are very much engaged with OSIsoft when it comes to the visualization of data and in the enablement of our customers to be able to access their data, share their data anywhere, any time to any asset, whether it's human or physical asset in order for them to not only thrive in this market but be able to adapt their business models. So for us, it's very exciting and much, much appreciated. No, it's great. Thank you. All right, well, Michael, thanks for spending a few minutes with us, sharing the story. Thank you, Jeff. All right, I'm Jeff Frick. We are at OSIsoft, PyWorld 2018, downtown San Francisco. Thanks for watching.