 Okay, welcome to theCUBE. We're in San Francisco. This is live Silicon Angles flagship program, theCUBE. We go out to the events, extract the signal and the noise. And here in San Francisco, really ground zero for the future of the industrial internet, the industrial cloud, the internet of things, whatever you want to call it. We're living in a connected device and the consumers are all seeing it with mobile and the cloud. And that's moving really, really fast into the business, industrial world. And that's what we're here to talk about. I'm John Furrier, the founder of Silicon Angles. I'm joined with my co-host. I'm Dave Vellante at Wikibon.org. Bill Rue is here. He is the director and vice president and global technology director at GE. And really the man behind this event, one of the key hosts of this event. Bill, you can sure pick your spot. So congratulations on the activity that you guys are generating and the momentum that you have right now. That's a great topic. And it's not us. I think the market's moving here. So that's what makes it a great topic. Yeah, so, well, you guys got some news today. Why don't we start there? Yeah. Let's unpack that a little bit. Yeah, so we see this industrial internet movement being about how we can deliver outcomes and productivity games, applying big data, applying the internet, and so on. So our big news today was we really talked about this idea of delivering an industrial internet platform. And our first product there is the Enterprise Historian HD, which builds on Hadoop and allows us to manage and pull data off machines in real time and allow you to do analytics on that big data. Second thing is we announced the number of solutions or new services offerings out of our businesses under the tagline Predictivity. So good examples we announced Flexefficiency, which is really about how you can become more productive with your gas turbines. Yeah, so the Enterprise Historian, like a little time machine, you can kind of look back and then look forward with some of your services there. You talk a lot about real time, but you're also combining real time information with what people often call data lakes. You know, a huge amount of data out there. How do you see that working together in concert? Yeah, I think there's going to be two kinds of analytics. What's going to happen is that we're going to see, you know, working on the streams coming in and that's going to have to be early warning, seeing problems, starting to identify how the behaviors are occurring. I think the real opportunity in real time is going to be operationally. Can I make adjustments that I can get that one, two, three, four percent efficiency out of those big machines? I think on the data lakes side, where you're dealing with the historical aspect, I think what you're looking for is you're looking to have a crystal ball in the future. I think it's going to be like magic. We're going to predict this product part's going to break. We're going to predict that this is going to become less efficient and by predicting it, we're going to change how we maintain and operate it so we don't have those problems. So imagine I can get rid of the 40 percent of mechanical delays in the airline industry. If I can predict when something's going to break, I'm going to get rid of all that. Think about how that changes everybody's lives. Yeah, so I look at you guys, Bill's kind of like the conductor here, right? You've talked about the ecosystem and the importance of the ecosystem today. You've been doing work with Accenture for quite some time. You had Amazon here, one of Ogles was here. Obviously Pivotal is a big partner of yours. Talk about the ecosystem, how that's evolving and where you see it going. Yeah, I think that this is not a game you can do by yourself. Too big. You're too big, it really is, isn't it? And I think that when we look, we're about outcomes. We're about, we know the domain, we know what the productivity gains are. We know how to build those analytics. What we are beginning to realize is we need others like in system integration. We need others who bring the infrastructure and the platform as a service. So think about what we talked about today. Amazon infrastructure as a service. We got our customers coming on private, public cloud saying who you're going to work with. You got Pivotal because now we're thinking about how we have a platform to manage data using Hadoop as well as the cloud. And Accenture, world-class system integrator solutions, really complements what we're doing. So we're going to continue to expand those partnerships out, but this is an ecosystem play for us. Yeah, so this is just a start really here. These aren't exclusive partnerships. They're sort of beachhead partnerships, I guess. You got it. I'd call them. You got it. And so we heard some numbers today that Jeff Kelly and David Fleuer put out. I mean, this is a half a billion dollar total available market. I mean, it's just enormous, but the more impressive numbers are the ones that GE is talking about in terms of the GDP impact. Talk about that a little bit. Yeah, you know what? When we started this and said, well, we know that all our customers collecting data, we found it wasn't about the technology. They all said, look, don't come sell us technology. What they said is, figure out how we can get outcomes. So we looked at it and said, well, what's the potential for these outcomes? We were completely blown away. So when we looked at things like fuel burn on just our gas turbines, and we generate 30% of the world's electricity on those gas turbines, it's a $66 billion, $66 trillion, excuse me, $66 billion savings over 15 years. That's a 1% improvement, right? That's actually a 1%, that's a 1% improvement. And we probably can do better than that, right? I have a question on the outcomes thing, which by the way, I love that messaging. I also want to give you props for the event panel. It was fantastic. It was not only geeky in terms of technology and also futuristic with the industrial cloud, but you talked about business value and that was clear in the panel. But Jeff Kelly made a comment about an extreme example from on the one end, web advertising, serving data for a banner ad, someone clicks on it. If you miss that, then you miss-target it, no big deal. But if you miss-target, say, drug delivery to a critical patient, that's the value. So I love this buying outcomes value. And the web business, the web industry, went through this buying impressions advertising to performance-based marketing. You got it, yeah. Which is all based on measurement and data. You got it. So behavioral and contextual data drove the web. Now let's go to the business outcomes. How do you price that? How does that work? Do you change? Is it similar to the web where, hey, impressions are one thing, but let's get down to the bottom line. What business happened, predictive, value base? How do you measure outcomes? How do you price it? How do you sell it? You know, we're in the early days. So I want to say that this is, if you know the answer to that, we'd like to know. That's some ideas, Sam. I think that what we're going to see is a scope. 10% or 1%. We're going to see it kind of go through three, sort of, I think, three waves. I think the first wave, you're just trying to establish the ROI and sell them an analytic outcome that, you know, I think that's where we are today. And I think that's how they can consume it. I think the end game, the third phase, is going to be one where they're going to buy power by the hour or things like that, or you'll have the ability to. Now, will they want to? I don't know we know exactly yet, but I think we're going to go from where they buy capability to where the outcome is a guaranteed level of metrics, and you pay by what you get to where you may be buying power by the hour. So in the internet world of ads, it was sales. Give me a lead, all right? I know that's measurable, so you have a closed loop system there, and you guys mentioned the word closed loop in your press release here. So let's go to the outcome. First is measurement. You can't understand what you don't measure, right, in your case. So that measurement piece is Hadoop-based. It's real-time. What's next on the software paradigm? And it's cloud-based. What specific tech is going to be? Okay, I'm ingesting and measuring what's next. How do you, because now you're in verticals, right? You're in aerospace, you're in telematics, you could be in oil and gas, wherever it could be, they're different nuances. We first had to get our data in order. Once you got your data in order, like Hadoop and the analytics, I think that's sort of like table stakes. I think the next two technologies that we're kind of getting jazzed about, the machine to machine, because I think how you're going to virtualize your, not your data center, how you're going to virtualize your operational technology, how you're going to virtualize the machines, how you're going to make it easier to maintain those remotely, or in new ways, and utilize them the ways you never thought of before. So I think machine to machine communication, putting processing local to machines, analytics local, think of big data at the machine. I mean, this is not unlikely. I think the second technology is, I think we lose the people in this, but what jazzed us also is the people. When we look at the collaboration and technologies that are utilized in the consumer internet world, we realize we can change a field person's world by giving them those technologies overnight. And quite frankly, they're using some, it just not as organized as we can make it. So we just see the future of field force automation and machine to machine as next gen technologies. It's almost like ad tech. You got behavioral and contextual, the behaviors, the humans, and then the contextual is the machine data. Okay, so with that, let's pivot to, we had a censure on CTO Paul. And I was trying to get my arms around this notion of, okay, the consumer world has kind of set the stage for the industrial world, you guys point that out. But the consumer market's still, cloud war is going on. You've got Amazon fighting on now Pivotal, you've got HP Cloud. So you still have stacks that are developing technically in the marketplace. So how do you guys view that? Obviously you're talking about interoperability, but is it too early to make a move there? Is it just the open message going to be good enough? You know what, I think the, what we're hearing from customers, you know, which is a great source of information. The ones who want to buy outcomes. Yeah, you know what we're hearing from them is we're hearing that this, that they don't, they want a hybrid approach. They, some want to have it on their premise in a private cloud. Some want us to run in a private cloud. Some want a public cloud. And the fact is that we have to be able to do all of them simultaneously. And so what we believe is going to happen is that you can't, this is not the time to say, this is the final decision. What you have to do is you've got to be able to work with all of them, and then you've got to be able to move through them. The hard part for us is how do we make an environment that we can have our applications run in any of those, and not have to have three code baselines, because that's going to be something we can't support. Yeah, share with the folks out there the priority for GE here, and give a proof point of the investment that you've made there. Obviously this announcement is a big investment, but you know, bigger, bigger than that. It's that you're thinking big. What's the priority? And give an example of how you're investing in that. Well, the first priority for us, which we made two years ago was that we had to, we had to be able to have an organic capability, and we said, you know what, if you're going to, if you're going to build an organic capability, you're going to be somewhere where you're going to be, Silicon Valley. This is not a normal place for GE. I don't know if you noticed that. And- It's not connected. Yeah, yeah, it's not connected. So we came here, and we've done it our own way, but we made a commitment of a billion dollars over three years, Jeff Immelt made a commitment of a billion dollars over three years, that we are going to build out this capability. We're going to work on the platform. We're going to work on a strategy, and so on. You know what? This is now going into our businesses, and we have these eight businesses take healthcare. Recently, healthcare announced, they're going to invest now two billion on top of the one billion over four years to build their next generation set of applications. So when we talk about it, I think GE has the heft and the investment to be able to take this on. And those are two announcements we've made. Well, just on the Silicon Valley points, Silicon Valley's changing now. We talk about enterprise and business value. You cut the line in whether it's venture capital or partnership. So I think Silicon Valley's still got the geeky, emerging trend, but that's a good conversation. Yeah, we're bringing Silicon Valley to GE, I'll tell you that. So what's next for you guys? So starting to build out the ecosystem, made some, well, let's go back a little bit. You put it in the software center in 2011, made a big investment in Pivotal. You got these partnerships going. What should we look for? Evidence of momentum in the marketplace. Yeah, yeah, so first of all, we just look at our growth here in Silicon Valley. We thought we'd be 400 people in three years. We're 500 people in 18 months. We're gonna be 1,000 people in the next 18 months. So I think one thing is looking, can we be our momentum to get to 1,000? We have the size and the heft abilities kind of platforms and applications. I think the second thing you're gonna look for is how we establish this platform and work to get some standards into the market. We see the market moving so that others, the ecosystem develops. You're gonna see us make more investments into small startups. We'll make some announcements shortly on that. And then finally, the big thing is gonna be which services we bring out. And I think you're gonna see more services and then us showing the market momentum on the revenue side. Excellent. All right, Bill, well thank you. By the way, all my friends are connected. Spent a lot of time there, John Union College. Loves connectivity. And Bill, really appreciate you coming on theCUBE. Thanks for stopping by. Thanks guys, really appreciate it. Thanks a lot. We'll be right back with our next guest after this short break. We're live in San Francisco for the Industrial Cloud GE event. We'll be right back.