 Hey, welcome back everybody. Jeff Frick here with theCUBE. We're in San Francisco at Zora Subscribed 2017, about 2,000 people talking about the subscription economy. But what I liked is when Teen had some sample stories up, he went with the big iron. He went with GE, and he went with Caterpillar. Companies that you probably don't think of a subscription economy, like maybe you do Spotify or Amazon Prime. So we're really excited to have Tom Buckler. He's the director of IoT and channel solutions for Caterpillar, Tom, welcome. Yeah, I appreciate it. Thanks for having me. I love that you had a ton of industrial Internet stories. I mean, this is real. This is not like coming down the road, but it's here today. No, absolutely. You know, I mentioned during the keynote that since the mid-90s, we've been connecting equipment. Since the mid-90s, we've been on our autonomous journey. And it's just today we can talk about the largest industrial fleets of over 500,000 assets connected. All of that valuable information coming in to help our customers. And then the fully autonomous fleets in the mines. It's pretty exciting stuff. Right, and you touched on something that we talk about often in the context of GE. We've had GE on a number of times where those GE sell engines or do they sell propulsion to the airlines? And you talked about do we sell as big earth moving equipment or do we sell X number? I don't even know how you measure big giant masses of rock and gravel move, but really selling it as a service not necessarily just the truck. Yeah, I think that, you know that was an important part of our discussion because when we talk about IoT and digital, it's really a very customer-centric strategy. So we're going to get into services like IoT type or digital-based services, which is our Cat Connect portfolio. If it's going to help serve our customers that we have today in the industries we play, be more successful, increase their operations, increase their efficiency. So we're not looking to build a platform or be a software company. When we get into this space, it's focused on those customers and increasing their profitability. And that's what leads us into these areas. We're going to be a heavy equipment manufacturer. We're going to sell big iron. That's what we do. We're going to leverage digital to help our customers be more successful. You say that, but I'm telling you, I can turn the lens a little bit. I see a whole lot of software company behind that big iron, so. No, I'm not, there's a lot of software on those machines. There's a lot of software that's coming off those machines and certainly we want to take all of that information. We want to put analytics on it and we want to help our customers go from being reactive to predictive. And really that's why we're at this conference, because when you get to what we call our Cat Connect services, a lot of those are subscription-based. When we're connecting 500,000 machines or we're able to go out and enable grade, assist on a machine over the air, or we're going to have these predictive health services to make sure uptime is maximized, all of those are data-driven services through Cat Connect and they're all subscriptions. So it's a natural fit for us to migrate into that along with our product business. Yes, some interesting numbers that you shared in the keynote. 500,000 connected machines. You talked about the obvious stuff, unplanned downtime, these are huge assets that need to run as close to 24-7 as they predictably can. But then you mentioned just looking at some other data and not even really heavy lifting data, but customers are getting tremendous utilization gains by leveraging some of the software that you guys have incorporated into the machines. Yeah, it's powerful stuff. I mean, if I talk about construction, the customer we mentioned is they asked us to connect all 16,000 pieces of their equipment. 3,000 of those were cat earth-moving machines. The other 13,000 weren't. They were a variety of other types of machines, but with the customer with that information and when they can get put it on one screen and they can look at utilization, they can look at location, they can look at idle time, they can increase their utilization significantly. So basic data with a fleet that size can help customers realize 10, almost 20% utilization gains and across the fleet that size, it's big money and it's big customer value. But even all the way down to the person who's got 10 machines, they can start to look at idle time, they can look at operator abuse and where they can train their operators better to perform better, so basic information of some of these machines is very valuable. It's such an interesting concept because you keep talking about your customers doing better with the assets that you guys provide them. When you're in a subscription relationship and you have this ongoing, back and forth, repetitive connection, it's a very different relationship and when you just sell something and you ship it and you take the money and you go on to the other one. And it seems like that's really kind of the secret sauce of the subscription economy that not enough people really highlight. Yeah, you know, in some cases, that's a great point. And one of the strengths of Caterpillar is our global dealer network. And so you mentioned about selling the product. You know, when we sell the product, our dealers provide that product and sell it to our customers, they generally have a long standing relationship with that customer. Everything from helping them with uptime to machine selection to operation to operator training. So we're in the business of working with customers through the long haul, but to your point, these digital services, you know, they create a digital relationship that's ongoing along with our dealers relationship that they've had for decades. So it's a really powerful kind of combination. And then I would imagine the data that you're now getting back off these machines, which before they were all connected, you know, you kind of saw them at the maintenance cycles and you could kind of see, you know, maybe what happened or didn't happen or maybe there's some patterns that are geographic or type of job or whatever. But now, you know, I love that the quote, we used to take a sample of old data and now we take all of current data. It must be tremendous value for you guys to develop better products, have better maintenance on your own products, see how these things can do much, much better. Yeah, you're absolutely right. And you know, when we talk about the data off the products, a lot of people initially go to telematics. And certainly when we talk about, you know, 500,000 assets, I'm talking telematics, but we also do about five million fluid samples that are off different compartments. We've got visual inspections that are on electronically through CAT and SPECT that's all the data coming back. So all of that information is really rich information. And to your point, we can take that all the way back to new product design and make sure that our next products are optimized. Pretty exciting stuff, absolutely. And who doesn't love a big yellow tractor truck? Absolutely. All right, Tom, well thanks for taking a few minutes out of your busy day and congratulations. All right, thanks for having me. All right, he's Tom Buckler. I'm Jeff Frick. Thank you. We'll be back after this short break. Thanks for watching.