Skynet is Rising: the Industrial Internet

This week I had the pleasure of attending the Israel Deal Makers Summit in New York.  The keynote address was from Jeff Immelt, CEO of G.E.  Mr. Immelt’s focus was that there mission is to be at the center of the new “industrial internet” or the “internet of things”.  The initial billion dollar investment is ramping up into full swing with a hiring binge in the hundreds. The goal is to connect every sensor of every machine G.E. ships.  These connected parts would be wired into a sophisticated analytics database that monitors usage and controls inefficiencies.

The example, Mr. Immelt described was impressive. He said if one can reduce jet turbines inefficiencies by just 1% it would save the airline industry over $3 billion.  This is a transformative idea, that has ramifications on everything we (humans) touch.  Imagine a washer and dryer that can automatically alert service calls with the exact problem, or a fridge that calls its owner up with a shopping list.  This requires artificial intelligence, machine-learning software, vast streams of data, and Fort Knox tight security to protect our plains, grids and infrastructure.

“These technologies are really there now, in a way that is practical and economic,” said Mark M. Little, G.E.’s senior vice president for global research. According to the New York Times, G.E.’s embrace of the industrial Internet is a long-term strategy. But if its optimism proves justified, the impact could be felt across the economy. Today, G.E. is putting sensors on everything, be it a gas turbine or a hospital bed. The mission of the engineers in San Ramon is to design the software for gathering data, and the clever algorithms for sifting through it for cost savings and productivity gains. Across the industries it covers, G.E. estimates such efficiency opportunities at as much as $150 billion.

Some industrial Internet projects are already under way. First Wind, an owner and operator of 16 wind farms in America, is a G.E. customer for wind turbines. It has been experimenting with upgrades that add more sensors, controls and optimization software.  The new sensors measure temperature, wind speeds, location and pitch of the blades. They collect three to five times as much data as the sensors on turbines of a few years ago, said Paul Gaynor, chief executive of First Wind. The data is collected and analyzed by G.E. software, and the operation of each turbine can be tweaked for efficiency. For example, in very high winds, turbines across an entire farm are routinely shut down to prevent damage from rotating too fast. But more refined measurement of wind speeds might mean only a portion of the turbines need to be shut down. In wintry conditions, turbines can detect when they are icing up, and speed up or change pitch to knock off the ice Upgrades on 123 turbines on two wind farms have so far delivered a 3 percent increase in energy output, about 120 megawatt hours per turbine a year. That translates to $1.2 million in additional revenue a year from those two farms, Mr. Gaynor said “It’s not earthshaking, but it is meaningful,” he said. “These are real commercial investments for us that make economic sense now.”

G.E. is gearing up to be the google for machines, but what happens when the become aware?

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